Ocean liner Queen Elizabeth 2 becomes hotel

(Queen Elizabeth 2)

Dubai said Monday it has decided the fate of the Queen Elizabeth 2, the 45-year-old ocean liner it bought at the height of the economic boom five years ago and which has been lying idle in the emirate's Port Rashid ever since.

The ship's owner Istithmar World, which reportedly considered selling the QE2 on several occasions to raise money during the financial crisis, announced plans to renovate and convert the ship into a 300-room hotel. The state-owned company said work will take 18 months, after which the QE2 floating hotel will be permanently docked in Dubai.

"The ship is in immaculate condition," Istithmar World chairman Sultan bin Sulayem said at a news conference to announce the plans for the ship. "It's going to enhance the tourism sector in Dubai."

The plan follows years of speculation about the future of the QE2, which Istithmar bought in 2007 for $100 million from Cunard, a subsidiary of cruise giant Carnival Corp.

The QE2 has been docked at Port Rashid since it arrived in Dubai. The 70,000-ton behemoth first floated in 1967 and was a cruise ship and ocean liner operated by former owner Cunard until its sale to Istithmar in 2007.