Dubai Launches New Incentive Program to Boost Hotel Development

The Dubai Department of Economy and Tourism (DET) has introduced an incentive program to boost hotel development in high-growth areas like Dubai South, Palm Jebel Ali, Dubai Parks, and the Dubai Islands.

Approved by His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum via Executive Council Resolution No. (68) of 2025, the initiative reimburses 100% of Dubai Municipality fees on room sales and the Tourism Dirham for two years post-opening for new hotels, resorts, and hotel apartments.

The program aims to strengthen Dubai’s hospitality sector and support its tourism growth, which saw 12.54 million international visitors in the first eight months of 2025, a 5% year-on-year increase, with hotel occupancy at 78.5% and 29.03 million room nights. Issam Kazim, CEO of Dubai Corporation for Tourism and Commerce Marketing, highlighted the initiative’s role in expanding Dubai’s tourism footprint through public-private partnerships, aligning with the goal of making Dubai a top destination for living, working, and investing.

Khalifa Al Zaffin, Executive Chairman of Dubai Aviation City Corporation and Dubai South, noted the program’s potential to attract investment, particularly in rapidly developing areas like Dubai South. Khalid Al Malik, Managing Director of Dubai Holding, emphasized its contribution to sustainable growth and Dubai’s appeal to global investors.

Applicable to hotels registered after the Resolution, the initiative supports the Dubai Economic Agenda, D33, to meet rising tourism demand. Eligible establishments must be licensed under Decree No. (17) of 2013, start operations within three years of application, and comply with DET regulations. Investors can apply through DET, which will oversee compliance.

The incentive applies exclusively to hotel establishments registered after the Resolution’s introduction and licensed under Decree No. (17) of 2013, which governs the licensing and classification of hotel establishments in Dubai. Eligible projects must begin operations within three years of application and maintain compliance with DET regulations throughout the benefit period.

Investors can apply through the Dubai Department of Economy and Tourism, which will review submissions and ensure ongoing compliance. The program aligns with the Dubai Economic Agenda, D33, which aims to position Dubai as a leading global hub for business and tourism.

This strategic move reinforces Dubai’s position as a global tourism and investment hub by fostering development in emerging areas and enhancing its hospitality infrastructure.