Tourism: Qatar's new source of energy

4 min reading time

Published on 09/06/15 - Updated on 29/06/23

Katara Tower, Doha

Owned by Qatar Investment Authority, the Emirate sovereign wealth fund Katara Hospitality contributes to the diversification process of the country's economy, by creating long-term value through its investments in the international hotel industry and by playing a structuring role in the development of tourism in Qatar.

For a few years, Qatar has been stepping on the gas to diversify its economy to prepare for life after petrol. As in 2013 the Emirate owned the third largest conventional natural gas reserves, or 13% of global reserves, its economy relies strongly on the oil & gas sector. The industry, whose resources are not eternal, represents more than half of the country's GDP, more than 94% of its exports and around 80% of its budgetary revenues. Thus it is extremely important for Qatar to become less dependent on the oil & gas industry by investing its revenues in other sectors and perpetuating its sources of revenues for future generations. The phenomenon affects all the major oil producing countries, all the more so now that the drop in the price of oil threatens their economic growth. Similar diversification strategies have thus also been adopted by the sovereign wealth funds of other oil producing countries, such as Abu Dhabi and Norway.

Qatar authorities have adopted policies to reduce the share of oil & gas in the country's economy, particularly by implementing a vast public investment program. Defined in the plan "Qatar National Vision 2013", it bears on a total of some 200 billion dollars over the decade. Qatar Investment Authority (QIA), Qatar's sovereign wealth fund, plays a fundamental role in this program by perpetuating the Emirate's sources of revenues in order to prepare for the post-petrol economy.

The diversification strategy for the Emirate's economy requires increased investment of Qatari funds in the global tourism and hospitality industry. Created in 1993, the national Emirate airline Qatar Airways, like others in the Gulf, rapidly took off and achieved global reach in the international airline industry through the acquisition of other transporters and the development of its own offer which competes with European hubs. Owned by QIA, another mission for Katara Hospitality is to develop and manage investments for the sovereign fund in the hospitality sector under the direction of Hamad Abdulla Al-Mulla, a former hotelier and now CEO of the company.

One of the primary vocations of Katara Hospitality consists of creating real estate value through the acquisition of trophy assets worldwide. The organization acts as an asset management firm dedicated to hotels, the operations of which it entrusts to international hotel groups. This is precisely what it did in 2011 when it took over ten properties in Europe, Asia and Africa, including the Royal Monceau and the Peninsula in Paris or Excelsior Gallia in Milan, and then in 2014 by taking over five other properties under the InterContinental brand located in several major European cities. Katara Hospitality also joined the resorts segment, where it intervenes as property owner. The Sharm el Sheikh Golden View Beach Resorts, in Egypt, was indeed the first international acquisition realized by the fund.

But Katara Hospitality also plays a structuring role in the development of Qatar's hotel supply, particularly with a goal to organizing the World Cup in 2022. For the event, which should attract some 3.7 million visitors throughout the year (versus 2.8 million in 2014), the FIFA asked Emirati authorities to build 60,000 hotel rooms. Katara Hospitality, which has a portfolio of seven hotels operating in Qatar, plans to contribute with a pipeline of eight other properties that are under development. The company should thus be able to add 1,800 rooms to the market, a supply that will be rapidly absorbed by growth in demand produced by the Soccer World Cup. Close to 600 of its new units will be opened in the Katara Towers, which are currently under construction to reveal their outstanding architecture by 2018. Katara Hospitality should operate three of these new addresses under its own brand Murwab (Grand Murwab City, The Avenue, a Murwab Hotel, the Simaisma, a Murwab Resort), which will also be rolled out in two others properties (the Saraya Corniche and City Gate Hotel). With close ties to the country's history, the Murwab Hotel concept melds the tradition of Qatari hospitality with the latest technological innovations, for an upper upscale hotel experience. Finally, to accompany the development of the hotel supply, the strategy of Katara Hospitality consists in convincing other investors to strengthen the Qatari supply. The company thus makes a considerable contribution to the tourism development of the Emirate, which nonetheless does not wish to strategically compete with Dubai as it concentrates more on sports, cultural and medical tourism.






In just a few years, Katara Hospitality developed a portfolio of 34 properties (7,218 keys) worldwide, 21 of which were operational and 13 under development, meaning more than the goal that it had set for itself to manage or own 30 hotels by 2013. "The year 2014 was marked by a series of successes for Katara Hospitality with the addition of new properties, the realization of new investments and our entry onto new markets. At this beginning of 2015, Katara Hospitality is well positioned for a new year of success, with several openings and developments of hotels scheduled for the months to come," declared Hamad Abdulla Al-Mulla, CEO Katara Hospitality. The organization is now targeting the addition of 30 new hotels in its portfolio by 2026 to support the arrival of 7 million tourists in Qatar by 2030, as forecast by Emirate Authorities. In the end, the goal is to grow the sector so it accounts for 3% of Qatar's GDP, versus about 1% today. 

Also read:



  • Katara Hospitality seeks acquisition of five European hotels
  • The Peninsula Paris prepares its grand opening




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