Ras Al Khaimah on its way to becoming UAE's adventure tourism hub
As the northern emirate unveils a number of tourism products and initiatives to meet its target of 1.5 million visitors by 2021 and a total of 3 million visitors by 2025, Hotelier Middle East takes a look at the challenges and opportunities ahead
Since it opened in February 2018, more than 25,000 people have zipped through the 2.83-km long Jebel Jais Flight, located 1,680m above sea level on Jebel Jais, the UAE’s highest mountain.
Jebel Jais Flight is just one example of the kind of differentiated attractions Ras Al Khaimah seeks to develop, in its race to become the region’s adventure tourism hub.
Ras Al Khaimah Tourism Development Authority (RAKTDA) has invested heavily in a range of adventure and wellness products to leverage the emirate’s natural assets, such as a 64-km long coastline, mountains and all-year sunshine, with a key focus on Jebel Jais and the surrounding area. Three new eco-friendly adventure-based projects on Jebel Jais have been launched – the Arabian Gulf’s first commercial Via Ferrata (iron path) featuring hiking and zipline challenges, the viewing deck park and Jebel Jais Flight. A shuttle service has made access to the mountain easier for visitors and residents.
RAKTDA’s strategy is paying dividends, declare the experts. Speaking to Hotelier, Colliers International MENA head of hospitality, Christopher Lund says, “RAK’s ability to attract the domestic market is very strong, as it positions itself as a primary weekend getaway destination for other emirates.
“With 18% of total guest nights comprising stays from domestic travellers, the current hospitality environment and tourism offerings are tailored to attract this key segment. Weekend packages, all-inclusive resorts and adventure tourism attractions differentiate RAK’s hospitality environment from the other emirates.”
The emirate’s first three-year destination strategy was launched in 2016, targeting one million visitors by 2018. That target was exceeded, with a reported 1,072,066 visitors from domestic and key international markets staying in RAK during 2018, a 10% growth in visitors compared to 2017, led by the UAE domestic market, which continues to generate 38% of overall visitors.
Germany continues to be the leading international source market with 83,605 visitors, followed by Russia, with 83,531 visitors, up by 17% on 2017. The third-largest source market was the UK, with 63,054 visitors, up 11.5%; India was fourth with 62,325 visitors, up 22%; rounding out the top five was Kazakhstan with 27,168 visitors, a growth of 28%.
Bucking the downward trend of the rest of the country, Ras Al Khaimah’s hotel sector had a strong year. Christopher Hewett, director of TRI Consulting supplies the numbers: “RAK saw a 9.9% growth in visitor arrivals to 1.07 million. The destination also generated a 3.8% growth in room nights to 3.45 million. Despite a 4.5% decline in occupancy levels to 70.2%, average rooms rates increased 4.9% to AED 640.8, resulting in RevPAR growing 0.2% to AED 449.7.
“The decline in occupancy levels was primarily driven by a lower length of stay which fell 5.5% from 3.41 days to 3.22 days. Despite this decline, RAK achieved the highest ADR growth and second-highest RevPAR growth in the UAE. With the exception of Ajman which also grew ADR and RevPAR, all other emirates experienced a decline in all performance indicators.”
Ras Al Khaimah’s favourable climate, relaxed atmosphere, culture and nature were big draws. Hewett elaborates, “Whilst occupancy levels were impacted by a shorter length of stay, the growth in room rates was driven by a greater number of higher spending tourists from Europe.”
Lund adds: “RAK’s hotel performance has remained consistent over the past two years. With the increase in hotel supply in 2018, it was not surprising that overall occupancy rates decreased by 4.5%. However, the ADR increased by 4.9%, which signifies the ability of the market to absorb the increase in hospitality supply resulting in a 0.2% increase in RevPAR.”
So what are the challenges and opportunities ahead? “In the short term, the strong dollar will continue to present challenges for hoteliers in attracting European visitors as the weaker euro and pound reduces the purchasing power of tourists,” Hewett stated. “However, opportunities for increasing domestic demand remain not only from a weekend leisure perspective but also for corporate getaways and incentive trips.”
Hewett believes that though the competition is heating up, RAK hoteliers will achieve more by collaborating rather than competing with each other, in order to increase the overall attractiveness of the destination, over other regional draws.
“RAK is still a relatively small market, when compared to Dubai, for instance. It does not have the international recognition of Dubai and Abu Dhabi. This is expected to change as government campaigns and strategies are set to increase the emirate’s visibility as tourism destination,” Lund opines. “Furthermore, the upcoming hospitality pipeline in the emirate is set to diversify its current offerings, thus further solidifying the emirate as a growing tourism destination.”
The emirate is still heavily reliant on their top three source markets: Germany, Russia and the UK, which account for 34.5% of total market share. “A significant decrease or increase in any one of these source markets will affect RAK hotel performances,” Lund believes.
Signings and openings
Ras Al Khaimah has 6,500 rooms currently available with the introduction of a number of major brands including Marriott, Movenpick, Sheraton, Anantara, Rezidor, Intercontinental and Conrad over the next three years. According to STR’s pipeline report there are a total of 21 hotels with 7,233 rooms planned for the emirate. “RAK is expected to see an increase in supply of approximately 7,600 rooms by 2025,” informs Lund. “Most of the development in the pipeline are expected to be situated on Marjan Island. Also, most of the future developments fall under the four- and five-star categories and are projected to be operated by well-recognised international hospitality brands.”
Hilton has had a presence in Ras Al Khaimah for more than 15 years. The emirate’s first international hotel – Hilton Ras Al Khaimah – opened in 2001. Today, Ras Al Khaimah has six Hilton properties across four brands.
Hilton area vice president of operations, Arabian Peninsula and Turkey, William Costley says, “We recently announced that we will be introducing the Conrad Hotels & Resort brand to the emirate with the signing of Conrad Marjan Island Resort.
“We will be introducing the Hampton by Hilton brand with a new Hampton by Hilton in Al Marjan island too. Our properties continue to perform well and are popular with domestic and international guests alike. We look forward to welcoming DoubleTree by Hilton Ras Al Khaimah Corniche Residences to our portfolio later this year – and with a total of three properties in the pipeline in the emirate, we are pleased to be contributing to Ras Al Khaimah’s long-term tourism target to attract 3 million visitors annually by 2025.”
Outlook for the future
Ras Al Khaimah recently unveiled its Destination Strategy 2019-2021 – a raft of initiatives designed to attract higher yield visitors, accelerating foreign and local investments in the tourism sector. The strategy also aims to nurture home-grown small- and medium-sized enterprises to create employment and business opportunities, and to prioritise sustainable nature-based adventure and cultural experiences.
By 2021, the strategy calls for 10,000 more people to be employed in the tourism and hospitality sector. The emirate hopes to attract close to 1.5 million visitors by 2021 and 3 million by 2025. What can hotels look forward to from Ras Al Khaimah’s recently unveiled Destination Strategy 2019-2021? Hewett believes the clearly set out goals will help hoteliers .“This clarity is important as it will provide hoteliers with a framework for their sales and marketing strategies over the next three years and work with the RAKTDA during global industry events.”
RAKTDA CEO, Haitham Mattar says, “As our tourism offering evolves in Ras Al Khaimah, we must ensure our destination is attractive to travellers who wish to explore beyond the resorts and hotels. We’re delighted with the success our offering has had in our target markets to date, but with the new destination strategy we aim to diversify and enhance visitors’ experiences through differentiated product development.
“Over the next three years, RAKTDA will continue to create compelling offerings to attract close to 1.5 million visitors by 2021, and 3 million visitors by 2025. In response to growing visitor numbers, further development is planned, including a 47-room luxury mountain camp, a survival training academy, 64.72 km of hiking trails and the Jebel Jais Adventure Park, in partnership with Toroverde UAE, featuring several new adventure products expected to launch this year, such as a ‘zipline tour‘, the Bull maze and climbing tower’at the Viewing Deck Park.
RAKTDA is also further strengthening its MICE, sports and events offer in the next few years. Global sporting events to be hosted in the emirate include The Road to Ras Al Khaimah (final of the European Tour Challenge Tour), the Ras Al Khaimah Half Marathon, Tough Mudder, Hajar Ultra, and the UAE Tour. Tourism will be bolstered by this calendar of world-class events, and increased international partnerships with the travel trade through new overseas offices and a series of trade roadshows throughout the year.
The good news is expected to continue throughout 2019. Lund predicts the existing attractions will grow in popularity over time. “Future developments in Jebel Jais are also expected to attract an increasing demand in weekend getaways, especially during the cooler months,” he says.
Among the external factors that can potentially have a positive impact on the Ras Al Khaimah market is the increased outbound travel by Russia, one of the emirate’s key source markets.
Approximately 82% of RAK’s visitors are from international markets, generally arriving via Dubai. RAK’s dependency on Dubai’s International Airport will slowly decrease as it eyes an increase up to 30 routes by 2020.