Dubai’s economy is mainly dependent on its tourism industry not on oil resources. Hotel industry and modern trends are geared up in this sector. Since this region is hit by financial crisis, tourism industry has also been going through some tough times. That is why most of the hotels observed the sharpest drop in revenues for 2009, according to a survey.

Occupancy and average daily room rates have declined in the whole region. According to data compiled and provided for the hotel industry, the overall region’s occupancy in 2009 is dropped by 10.9 to 62.0 percent and average daily rate decreased by 2.7 percent, revenue per available room decreased 13.3 percent and the largest drop in revenue per available room is falling to 31.4 percent.

Dubai has faced the recession slump badly but it is most probably just a time lag; it will follow the other regions that came out of this cycle on the recovery path. Before the slumped situation, when emirates’ construction boom began, luxury hotels, resorts, beach hotels and holiday villas mushroomed and attracted tourists in a great numbers. After the economy crisis people are also bewildered and have tighten their budget, they are not ready to invest but to save. Prices have become unsustainable and to cope up with this situation, owners have started offering tenants rent-free period and flexible payment terms, along other perquisites.

Funding issues and nervousness about the hotel market has also delayed the opening of several hotels that have been completed on the neighboring Jumeirah Beach. That is why serious buyers are not in more numbers as compared to shoppers and tourists.

Economic Downturn has caused troubles in almost all fields of life but its effects are especially visible in tourism and hotel industry. Dubai is no exception either, tourism has declined and consequently, Dubai hotels’ rates have also decreased. However there are always two sides of the pictures, being optimistic, we can derive some positive hope out of this gloomy situation. Positive side is that declining hotels room rates are attracting more tourists and it is a healthy sign for both Dubai tourism and its overall economy.

This decline means that Dubai Hotels are becoming more affordable. Mostly tourists around the world are looking for affordable holiday destinations and Dubai is quite popular for its luxurious destinations and marvelous hotels. High profile classic destinations can cast the image of lavish and deluxe spots in tourists’ minds. In addition to its high-rise hotels, their advertisements and lack of public transport contributed to Dubai Economic issue in 2009.

Tourism Consultancies boom explained that Dubai appeared as an exemplary city out of no where and its image grew too rapidly. Even when there were not enough hotels, people still wanted to visit. This image was shattered when Dubai faced economic crunch and every sector felt its after affects, hotels prices were declined and luxury rooms remained vacant. It is because every hotel is advertising itself at highly competitive rates and average daily room rates were decreased.

The occupancy level is moving up but only slightly. At the end of 2009; it rose to 71.9% as compared to last year’s occupancy level that was 64.3%.