Following months of delays, Dubai's first low-cost 200-room easyHotel is expected to open in Jebel Ali Free Zone by the end of the year, according to the group's founder Stelios Haji-Ioannou. "The hotel in Dubai will undercut everyone in the market. I think Dubai needs budget hotels. This is a real city with real people. A city has to function at all levels," Haji-Ioannou said.
"I think Jebel Ali is the right location for this hotel, because it is a free zone; it has a lot of small businesses in the area. It's a budget hotel in a city that needs budget hotels and allows you to stay for less than $100," he added, speaking at Cass Business School's Dubai Symposium, being held at the Dubai International Financial Centre.
In 2007 Haji-Ioannou entered into an exclusive agreement with Nakheel Hotels - previously Istithmar Hotels - to construct the first of a series of budget hotels in the country. The site initially proposed for the first easyHotel was in Al Karama but later Jebel Ali was identified as a more appropriate location.
"I probably announced two years ago we'd be open in a year and a half and we're still not open & we now have the design approved. But we simply couldn't get them [the regulators] to approve what we had in London. They wanted their version of a budget hotel," Haji-Ioannou said, alluding to delays in gaining regulatory approval for the property.
He added that after the first easyHotel was up and running, he hoped authorities would be more open to letting the budget hotel business model develop unhindered.
Haji-Ioannou also said that he will be discussing other location opportunities with Nakheel on his current trip.
easyHotels form part of the low-cost easyGroup of companies that began when the entrepreneurial Haji-Ioannou launched the "no-frills" easyJet airline in 1995, aged 28.
The exclusive partnership deal with Dubai Inc stalwart Nakheel means that the developer has sole right to develop easyHotels in the Middle East and North Africa. Yet the impact of the economic slowdown has hit real estate developers in Dubai particularly hard.