As one of the most prolific sectors in the UAE, tourism provides foreign entrepreneurs countless investment opportunities to put money into it. There are many business possibilities in the accommodation industry in Dubai, from restaurants to hotels.
The Dubai government has allowed a number of legislation and regulations, clarifying requirements to establish hotels in the Emirate.
Classification of Hotels in Dubai
Before we dig deeper, let us first understand the basics. The hotels in Dubai are divided under various parts. If you want to start a hotel business in Dubai, it should be under one of the following categories:
- Hotel Apartments
- Youth Hostels
- Guest Houses
- Holiday Houses
Regulations for opening a hotel in Dubai
The first step in establishing a hotel in Dubai is to register a business with the Department of Economic Development. A local partner or sponsor will be required to register an onshore business, whereas a free zone business is not subject to these conditions.
Once the company is registered, the following regulations related to the hotel industry in Dubai must be complied with:
– The owner and the manager of the hotel must have good conduct which will be proved through a certificate;
– A hotel room may not have less than 30 square meters;
– Submitting a bank guarantee in order to obtain the license issued by the Dubai Department of Tourism and Commerce Marketing (DTCM);
– Using specific programs where the data of the clients is introduced;
– Making sure the touristic packages are correctly displayed.
Benefits of Starting a Hotel Business in Dubai
Hotel business will be a sure shot way to crack into this multi-billion dollar sector in the UAE. Here are a few benefits of setting a hotel company in Dubai.
- Global Events
Dubai Expo 2020 is said to have 25 million outside visitors which is a once in a lifetime opportunity to make this business profitable than it already is.
- Talented Staff
Dubai being a multicultural city is also a treasure chest for talented manpower. The investor will be able to find all the personnel right from the senior managers to service and floor staff easily with profile that fits his business model and target crowd.
- Everyone Needs a Place to Stay
There are thousands of visitors flying in and out of Dubai everyday with every person belonging to different income class. They will, therefore require a boarding that fits their income bracket.
- Easy Set Up Process
The process to set up a hotel business is simple and straightforward with less hassle. Investors can follow the rules and regulations to get their job done without any knots in the process.
How to Open a Hotel Business in Dubai
First thing you need to know is, unlike other businesses in Dubai which require you to have a trade license, a hotel business formation shall have a tourism license. Other than that, for the most part, the procedure is the same as any other business in Dubai. The next thing is, where do you want to set up a business- Mainland or Freezone. Because rules and process varies for every free zone while mainland process is same. Let us now understand the procedure to be followed to register your hotel business.
- Appoint a Manager
You need to appoint a manager for your hotel business with relevant qualification and approved certification through which he/she can be given a position. The manager plays an important role in terms of ascertaining the requirements of the hotel as well as aid through the process of initial approval and licensing
- Get the Initial Approval
Initial approval must be taken from the Department of Economic Development (DED). It includes sending them the following documents attached with the application form.
Filled application form from the DEDID and Passport copies of the applicantsBlueprint, plot map, location, and building completion certificate for the hotel propertyClassification card for the hotel businessManagers passport copy and educational qualification with experience letter (if any) Certificate of Good Conduct approval from DTCMApproval from Dubai general police headquarters
Once you submit this form and documents, DED will go through it and make a definite decision in a week.
- Obtain the License
Hotel business in Dubai requires you to have a tourism license. To get the same, you need to have the following documents:
- Fee receipt of initial approval
- Trade name certificate and related payment receipts
- NOC in case of international group or brand of hotel
- Ejari Certification for the property
- Initial approval documents and pertinent certification
- Consent from Dubai Municipality and related judicial bodies for sanitation, waste management, public health etc