With more Islamic finance flowing into the UAE, there has seen a steady growth in the number of dry hotels (that do not serve alcohol) coming up in the country, especially in Dubai in recent years, said a report.

The dry-hotel trend started in the early 2000s, when Islamic finance became more available in the country, prompting investors to build such hotels, reported the Gulf News, citing experts.

“Sharia funds are growing rapidly,” remarked Rupprecht Queitsch, the chief executive and senior partner at Inhoco Group, a hospitality consultancy in Dubai.

Total Islamic banking assets in the UAE grew to around $95 billion in 2013 compared to $83 billion in 2012, according to a report by the Dubai Chamber of Commerce and Industry.

The government had announced last year its aim to make the city the global capital of Islamic economy, the report added.
 
“An increasing number of Gulf investors are keen to develop dry hotels because of their religious conviction. So you’ll see more and more dry hotels,” stated Guy Wilkinson, the managing partner of Viability Management Consultants, a hospitality consulting firm in Dubai.

According to analysts, the emirate currently has about 100 dry hotels including Coral Dubai Deira Hotel, EWA Dubai Deira Hotel, Al Jawhara Gardens Hotel, Al Jawhara Hotel Apartments, and Coral Al Khoory Hotel Apartments.

Wilkinson pointed out that hotel apartments in the Gulf, including the UAE, are all dry, except for those that are linked to hotels with an alcohol licence.

Queitsch said this trend of dry hotels is expected to grow in Dubai over the next three to five years.

“If the funding continues to be available and the market grows in that direction, I don’t see any reason why [dry hotels] wouldn’t continue to expand,” he added.