GRIF and Juniper Strategy Launch Barometer for the UAE Hospitality Sector | News

The report is based on real-time input from 30 senior hospitality leaders who collectively operate more than 400 venues in the UAE, in addition to analysis of tourist recovery patterns during previous global crises. While not fully representative of the market, this provides a robust directional snapshot of current trading conditions and sentiment, alongside a broader view of potential recovery scenarios. Its purpose is simple: to replace noise with an informed, quantified view of current conditions, and provide operators, investors and decision makers with a clearer framework with which to interpret events, assess risks and understand the likely path of recovery.

The Barometer shows that the market is under pressure in the short term, but remains confident in the medium-term prospects of the sector. Average like-for-like performance among the sample is down 27%, but that figure masks a wide spread of outcomes. Much of this variation is location-driven. Nearly half (48%) say their residential locations are performing better than the rest of their estate, while tourist and office-heavy locations are under greater pressure.

In addition to weaker demand, the report finds continued cost pressures across the sector, with supplier costs rising by an average of 13% among the sample of operators. In response, many operators are acting defensively: freezing hiring, cutting labor costs, simplifying menus, renegotiating rents and supplier terms, and protecting cash flow.

Despite these pressures, the report emphasizes strong confidence in the recovery path ahead. Net confidence in the hospitality sector’s outlook for the next six months is +3 and rises sharply to +73 in the trailing twelve months, indicating that the sector views the current disruption as severe, but not structural.

This confidence is underpinned by the resilience of the UAE market and the recent track record of rapid and coordinated recovery post-Covid. The UAE’s foodservice market – estimated to be worth roughly $19 billion by 2025 – is built on a diversified demand base of residents, tourists and business travel, a structural advantage that positions the sector well for rapid recovery once conditions stabilize.

Historical precedents also help map out the likely range of recovery scenarios. The analysis of 24 major global crises shows that tourist demand recovers quickly once perceived risk decreases, with average visitor numbers returning to baseline levels within a year and exceeding pre-crisis levels in the second year.

Looking further ahead, the long-term drivers of the UAE’s hospitality sector remain firmly in place: a young, fast-growing and increasingly affluent population; a highly diversified demand base that includes residents, tourists and business travel; exceptional global connectivity as a major international aviation hub; and continued investment in tourism infrastructure, including developments such as the Wynn Resort in Ras Al Khaimah, the expansion of the Dubai Islands and the transformation of Expo City Dubai. Together, these factors have historically enabled the market to recover quickly from disruptions and continue to support its long-term growth trajectory.

Flo Graham-Dixon, founder of Juniper Strategy, said: “Our research shows that there is no one-size-fits-all experience in today’s market. Operators in residential locations are acting very differently to those exposed to tourism or business demand, and that gap matters when planning recovery. Confidence over the next 12 months is well-founded – history shows that these disruptions tend to dissipate faster than they currently feel – but the operators who best navigate this will be those who build their own position within that understand the picture, rather than waiting for a market-wide recovery to In that context, the most valuable role the industry can play is sharing insights, supporting each other and applying those lessons in ways that reflect individual circumstances.”

Jennifer Pettinger, Founder of GRIF, said: “We created the Barometer to support the GRIF community and the broader industry with a clearer, more informed view of the current environment. There is no doubt that this is a challenging moment, but it is also a nuanced moment, and the experience is not the same for everyone. The hope is that this report will help operators, investors and decision makers better understand what is market-wide, what is more location-specific and what history tells us about how recovery can unfold. We see this as an ongoing resource for the industry, and we would like to see more operators contribute over time to broaden its representation and strengthen its value.”

The UAE Hospitality Industry Barometer, developed in collaboration between GRIF and Juniper Strategy, is published under GRIF With Heart, an initiative focused on supporting the hospitality sector and providing insight, resources and community support to industry leaders. This report is the first release from the initiative, and further resources will follow.

The report is now available at grif.com/heart.