The InterContinental Hotels Group will launch 22 'limited service' or budget hotels across the Middle East by 2010, aimed at leisure and business travelers.

The hospitality group made the announcement yesterday as it opened its first 'limited service' hotel - Express by Holiday Inn - at Dubai Knowledge Village. The $30 million project marks the brand's entry into the Middle East.

"Express by Holiday Inn is the first of 22 hotels planned across the GCC countries and Jordan by the end of 2010,"said Haitham Mattar, director of sales and marketing for the Middle East and Africa, the InterContinental Group, Dubai itself will see the launch of another three Express hotels - in Jumeirah 1, Safa Park and near Dubai Airport's upcoming Terminal 3 - by the end of the first quarter of 2008, said Mattar, "We also plan to open another six hotels in the UAE, which will primarily be in Abu Dhabi and Sharjah," he added.

Express hotels are also set to open in Oman, Kuwait, Bahrain and Jordan. The group has teamed up with Dubai-based Ishraq Gulf Real Estate to develop the properties, which will have between 200 and 250 rooms each. "We will invest around $300 million in all these properties," said Mattar.

The four-storey, 244 room Express by Holiday Inn hotel in Knowledge Village will offer rooms for around Dhs.370 a night. The four-floor hotel boasts a mini-gym, a business communications centre, a lounge and restaurant.

Mattar hesitates to call it a 'budget' hotel because of the negative connotations attached to the word. "People think budget is low-quality. We are not low-quality; we like to call it limited service, which means that we cater to the basic requirements of business travelers. We don't have the extra facilities like the spa or swimming pool or a string of restaurants."

Asked about the growth potential for hotels in Dubai, Mattar responded: "The potential is enormous. We are building our hotels in response to consumer demand. We've had many conversations with businessmen who make short trips to Dubai, and they've told us that they find room rates in this city to be quite high. We believe that in this market, demand exceeds supply.