Dubai’s hospitality sector expanded further in 2025 with the addition of around 2,000 new five-star hotel rooms, according to data released by the Dubai Department of Economy and Tourism. The increase underscores the continued growth of the emirate’s luxury accommodation segment.
Figures show that the number of five-star hotel rooms rose from approximately 54,000 at the end of 2024 to about 56,000 by December 2025. As a result, the share of five-star properties increased from 35% to 37% of Dubai’s total hotel inventory, which reached 154,000 rooms by year-end.
Strong Occupancy Performance
Performance indicators also reflected solid growth. Five-star hotels recorded an average occupancy rate of 79% between January and December 2025, up from 76% in the previous year. Luxury properties accounted for the majority of new hotel rooms that entered the market during the year, highlighting continued investor focus on the high-end segment.
The Department of Economy and Tourism noted that 2025 witnessed the opening of several new hotel projects across key locations, reinforcing Dubai’s global appeal. Among the notable additions were Ciel Dubai Marina, Jumeirah Marsa Al Arab, Mandarin Oriental Downtown Dubai, Cheval Maison at Expo City, and Vida Dubai Mall.
In its annual tourism performance report, the department stated that the strong results of the hotel and hospitality sector positioned Dubai ahead of major global cities such as Bangkok, New York, Paris, and Singapore, and brought it closer to London in terms of overall hotel capacity.
Investment Incentives to Support Expansion
To sustain growth momentum, the department launched a new initiative offering investment incentives aimed at encouraging hotel development in high-growth areas. The initiative provides a 100% refund of Dubai Municipality fees on room sales and the Tourism Dirham for a period of two years from the date of opening and commencement of operations.
The move is designed to meet rising demand in emerging districts including Dubai South, Palm Jebel Ali, Dubai Parks, and Dubai Islands, in line with the objectives of the Dubai Economic Agenda D33.
Growth in International Visitors
Hotel expansion was supported by a steady rise in international arrivals. Dubai welcomed 19.5 million international visitors in 2025, marking a 6% year-on-year increase. In December alone, the city received more than two million international visitors for the first time in a single month, setting a new milestone for the tourism sector.
The combined growth in hotel capacity and visitor numbers highlights Dubai’s continued ambition to strengthen its position as one of the world’s leading tourism and hospitality destinations.
