Investment in the Dubai serviced apartment segment has grown in recent years, capitalising on the growing strength of Dubai’s tourism sector.
The industry is experiencing strong demand for hotels and serviced apartments, which had a market-wide occupancy of 78% last year, expected to continue in the lead-up to the World Expo 2020. Currently deluxe hotel apartments stand at 9,519, not enough for the anticipated 20 million visitors per year by 2020.
For investors, serviced apartments are attractive assets because of the hassle-free structure, up to 8% returns, hassle-free ownership, and the advantage that investors can themselves stay in the property for a period of usually one to two weeks each year.
Some limited serviced apartment projects are available on a sale and leaseback model and growing in popularity.