Dubai’s five-star hotels drive strong sector growth

Dubai’s luxury hotels are leading the city’s robust hospitality performance in 2025, with five-star properties driving gains in both occupancy and revenue, according to new data from real estate advisory firm Cavendish Maxwell.

 

Between January and August, the emirate’s total hotel inventory rose to almost 152,300 rooms across 818 properties, with premium segments accounting for the majority of supply. 

 

Five-star hotels led with 54,100 rooms, followed by 43,400 in the four-star category, together representing nearly two thirds of Dubai’s total stock.

 

Average occupancy across all categories reached 78.5%, up three percentage points year-on-year. 

 

The five-star segment saw the largest growth at 4.1%, followed by deluxe and superior hotel apartments at 3.8% and standard apartments at 2.5%.

 

The citywide average daily rate (ADR) also climbed 4.6% to AED526.

 

RELATED:

Dubai Tourism introduces hotel investment incentives

UAE hotel revenues jump 12% as sector posts record growth

Dubai set to join world’s top 3 travel hotspots in Q4 2025

 

Released to coincide with the Future Hospitality Summit World, the report highlights continued momentum for Dubai’s tourism sector, which attracted 12.54 million international visitors during the first eight months of 2025, up more than 5% over the same period last year.

 

Western Europe remained the top source market, contributing 21% of arrivals and recording 12% year-on-year growth. The GCC followed with 17% of visitors, up nearly 16%, while CIS and Eastern Europe accounted for 14.5%.

 

Arrivals from the Americas (7%) and Australasia (2%) also rose, by 11.1% and 12.4%, respectively.

 

Dubai is on track to rank among the world’s top three travel destinations in the fourth quarter of 2025, joining Tokyo and London, according to data from ForwardKeys.

 

The travel analytics firm reports a 6% year-on-year increase in forward bookings for international arrivals to Dubai, positioning the city to capture 2.2% of all global tourist arrivals between October and December 2025. 

 

Upcoming hotel openings include the 259-key Mandarin Oriental Downtown Dubai, set to open in October, followed by the world’s tallest hotel, Ciel Dubai Marina, in November, bringing more than 1,000 rooms to the city.

 

For more information, visit cavendishmaxwell.com