The UAE’s hospitality sector remains positioned for sustained growth, supported by long-term tourism demand, continued destination investment and a diversified mix of international, regional and domestic visitors, according to JLL’s UAE Hotels Market Dynamics Q2 2026 report.
The report noted that traditional summer seasonality and ongoing regional tensions affected international arrivals during the second quarter. Government measures helped reduce some of the impact, including Dubai’s AED 2.5 billion ($681 million) relief package introduced in two phases. The measures included exemptions from the Tourism Dirham, as well as hotel and restaurant fees, helping ease operating costs and support liquidity across the hospitality and tourism sectors.
Hotel operators responded to softer demand by offering discounted room rates, staycation packages and promotions targeting domestic and GCC travellers. Properties also introduced incentives such as dining credits, spa access and extended-stay offers to support occupancy and revenue during the period.
Temporary hotel closures for renovations also remained a cost-management measure, with some properties bringing forward refurbishment programmes during the period of lower tourism activity. The approach allows hotels to undertake upgrades and improve service standards ahead of reopening.
In Abu Dhabi, hotel inventory remained stable at 33,650 rooms during Q2 2026, with around 120 additional rooms expected to be delivered by the end of the year. Dubai recorded 159,300 hotel rooms, with approximately 4,900 more rooms anticipated by the end of 2026.
JLL noted that developers have taken a more measured approach to new projects, adjusting development timelines while prioritising upgrades to existing properties and waiting for demand conditions to strengthen.
According to the report, this cautious approach reflects near-term execution considerations rather than a decline in investor confidence. The UAE hospitality sector is expected to continue its recovery as market conditions stabilise, supported by the country’s established tourism infrastructure and ongoing investment in the sector.
