For real estate experts, the World Cup is about positioning Qatar on the world stage and learning from the mistakes of past host countries when it comes to infrastructure and inventory development. This was the central theme of the panel: Exploring the world of hospitality real estate at the Cityscape Qatar Conference.
Moderated by Edd Brooks, General Manager at DTZ Qatar, the panel explored the impact of the upcoming FIFA World Cup on the hospitality sector in the country, looking at South Africa and Brazil – past FIFA host countries – as case studies.
The aim of Qatar in preparing for the World Cup will be to avert an overflow aftermath and prevent its stadiums and hotels from turning into white elephants.
It’s not an impossible feat.
Grant Salter, member of the panel and Director & Head of Travel for Deloitte, believes that Qatar will need to change the way they operate to rescue the market and avoid an infrastructure hangover, like its other FIFA host-nation predecessors. He told conference attendees: “When building, we need to look beyond 2022 and have flexibility in the design so it can adapt after the World Cup.”
While Qatar is preparing for the upcoming 2022 FIFA World Cup, its tourism strategy embraces a far larger approach by looking beyond the World Cup to create a stable and diversified market post 2022, with the added objective of creating over 100,000 jobs.
According to DTZ, Qatar has obligations to provide more than 60,000 hotel rooms for the FIFA World Cup, however the quantity of stock in the pipeline has led to concerns of an oversupply within the sector, particularly in the 5-star category.
Qatar’s hospitality sector now has around 22,500 hotel keys available in Qatar, 88% out of which are 4-star or 5-star category properties.
The silver lining and a unique opportunity for real estate investors, say experts, can be found in mid-range hotels, specifically 2-star and 3-star hotels. Property consultant, DTZ notes that currently there is a lack of these mid-range hotels in the country and for investors looking at the hospitality industry, there is a demand for this kind of product.
It is also estimated that at least 15 hotels and serviced apartment buildings are scheduled to open in the next 12 months, which will potentially add up 4,000 keys to existing supply. Moreover, there are currently around 25,000 hotel keys in 64 developments at various stages of planning and construction in Qatar leading up to the FIFA World Cup in 2022.