Destination KSA

Saudi Arabia’s aim to create a powerful tourism legacy is precise, ambitious and now, within reach. Natalie Hami reports on how the Kingdom is making stellar progress.

Unprecedented growth and a significant opportunity for investment come to mind as a most fitting description for the powerhouse that is the Kingdom of Saudi Arabia. In order to further bolster its standing within the travel and tourism world and marking a significant industry milestone, the Saudi Commission for Tourism and Antiquities (SCTA), along with delegates from Saudi Airlines and flynas, debuted at this year’s WTM London, following the Saudi government’s plans to invest heavily in its tourism industry over the next 10 years.

In a MENA tourism and hospitality report by research consultancy, Aranc, the Saudi government expressed plans to invest over $30 billion in tourism from 2013 to 2023, with the main aims being to provide employment opportunities for Saudi graduates and cope with the increasing number of visitors, estimated to rise at a compound annual growth rate (CAGR) of two per cent to 21.3 million over the next decade.

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Vice president for marketing and programmes, SCTA, Hamad Alsheikh said: “Saudi aims to highlight the historic potentials of KSA as a crossroad of civilisations through displaying part of its history, heritage, achievements and tourism potentials by way of print material and direct communication.”

The SCTA’s director general of licensing, Omar Al Mubarak also recently revealed that having already witnessed rapid growth in investment, the Kingdom’s hospitality sector is further forecasted to grow, revealing that there are 149 hotels in the pipeline in different parts of Saudi Arabia. Al Mubarak explained that over 77 per cent of hospitality investment within the country is localised in Makkah and Al Madina, with more investment in these cities expected, in addition to increased hotel investment in other major cities of the Kingdom in the future, particularly in the three-star category, resorts and upscale furnished apartments.

Managing director, Narcissus Hotel and Residence Riyadh, Khaled Al Khlewi expressed to TTG how the Kingdom is ripe for investment: “There are lots of opportunities for investment in the Kingdom, as it has all the necessary requirements to share with businessmen who would like to invest in the country. This environment opened the door for a number of luxury brands from the hospitality industry to introduce branches in the country, since there are new projects of five-star hotels to open in Riyadh, besides the existing ones.

“This is aside from our new pure Saudi five-star brand Narcissus Hotels, which will have a sister hotel in Jeddah within the next two years.”

These rapid and long-term investment plans by SCTA are also reflected in the regional and international interest of hospitality giants including Rotana, Mövenpick, Carlson Rezidor and more. These companies are seeking to fulfil the imminent demands of the market, with many realising the need to gratify the needs of the mid-market.

Those already established are ever eager to expand into the more traditionally well-known cities as well as foray into cities in the Eastern province. Meanwhile, those who have not yet made their presence known in KSA, are flocking with evident enthusiasm to make their mark.

TTG sought to discover how industry heavyweights are preparing to step in and gratify KSA’s travel and tourism requirements – all the while, keeping the Kingdom’s deep-rooted culture in mind.

TIMELY PLANS

With visitor numbers set to soar, according to general manager, Radisson Blu Hotel, Riyadh, district director – Kingdom of Saudi Arabia, Basel Talal, there is a steady increase in supply as well as a similar or even greater rise in demand in many cities for quality accommodation. This is due to the government’s investments, thus allowing Carlson Rezidor to expand in line with these demands.

General manager, The Ritz-Carlton, Riyadh, Adel Al Mahboob agreed, noting that Saudi Arabia, and Riyadh in particular, has been traditionally known as a power hub for regional affairs as well as development, and therefore, quite naturally, the city receives a large frequency of visitors, all of whom have to be accommodated.

This was further reiterated by vice president sales and marketing – Middle East and South Asia, Mövenpick Hotels and Resorts, Toufic Tamim who told TTG: “The growth of the public and private sectors fuelled by mega-investments is subsequently generating more business travellers.”

Tamim added that the hospitality industry in Saudi Arabia is expanding significantly across the entire country, which creates the perfect scenario for the company to further increase its portfolio within the Kingdom.

Regionally homegrown brand Rotana also noted that its own expansion plans coincide with the expected growth of the destination’s tourism industry.

Area vice president – Saudi Arabia, Iraq, Egypt, Bahrain and Sudan, Rotana, Mohamad Haj Hassan commented exclusively to TTG: “The Saudi hospitality sector continues to enjoy robust growth based on religious tourism, which currently constitutes 75 per cent of all passenger traffic in the Kingdom; increasing domestic tourism; and an increasing number of business travellers as a result of the surge of commercial and construction activities.

“Thus, Rotana’s expansion plans coincide with the significant growth of the sector in the Kingdom and the company’s vision to be an essential part of this growth and contribute effectively to meet the growing demand for products and hotel projects in the Saudi market.”

Consequently, the company plans on adding over 2,000 new hotel rooms and suites in the coming years.
This sharp increase in demand has also created the need for a more varied hospitality landscape that runs alongside the already well established luxury propositions; enter the mid-market segment. This of course has
provided a much sought after opportunity for the hospitality industry.

Haj Hassan stated that Rotana will be working the concept of economy hotels, offering guests a great stay at convenient prices.

“We know that there is a huge untapped potential for leisure tourism in Saudi Arabia and the mid-range and budget accommodation offers attractive options as Saudi Arabia is looking to target mass tourism. The emergence of mid-range and low-cost hotels has become one of the hottest trends within travel accommodation.”

The company will be managing hotels in Riyadh, Jeddah, Al-Khobar and Dammam, with four of them falling under the Centro Hotels by Rotana brand. Rosh Rayhaan by Rotana is also due to open in Riyadh in Q1 of 2015.

Talal echoed a similar sentiment elucidating on the significance of tapping into such a lucrative segment: “Understanding what the customer wants as well as understanding the market on its own merits, form the very foundation of our business strategy and we are keen to expand our mid-market brand in key locations across Saudi Arabia.”

Apart from taking advantage of lucrative new segments within the hospitality industry, these noteworthy hotel companies are also looking away from the more conventional cities such as Jeddah and Riyadh, and seeking opportunities in the cities of the Eastern province.

This was aptly expressed by Talal, who commented on the untapped opportunities of Saudi Arabia’s secondary cities, whilst also outlining Carlson Rezidor’s commitment to expand in them.

“The Eastern province is one of the crucial areas with many demand generators, with plenty of opportunities in its smaller cities. Business segments range from corporate and MICE business to leisure and religious tourism, however, this does vary depending on the location.” He also noted that these opportunities are created by the government in a bid to spread wealth.

HISTORICAL POINTS

As the major hotel brands seek to most adeptly satisfy the boom in visitor arrivals set to grace KSA, SCTA has clarified one of the ways in which it plans to boost visitor numbers; through highlighting the destination’s rich history and heritage.

As such, existing properties in the Kingdom have fallen in line with this, enabling guests to experience true Saudi Arabian culture during their stay.

General manager, Four Seasons Hotel Riyadh at Kingdom Centre, Anthony Tyler told TTG: “More and more of our guests, who visit the city primarily for business, are looking for elements of authenticity and individualisation; looking for ways to immerse themselves in the local culture while conducting business. Riyadh is a treasure trove of exciting things to do, a destination where tradition blends seamlessly with modern-day excitement, promising unique cultural experiences for our guests.”

Tyler added that in response to the rise in demand for authentic experiences, the hotel’s concierge team has developed tailormade cultural packages that will deftly work around a guest’s business commitments and schedule to allow them to experience a historical site, visit an art gallery or discover an unknown side of this fascinating city.

Meanwhile, executive assistant manager, Burj Rafal Hotel Kempinski Riyadh, Hussam Al Huzaimi expressed to TTG the significance of witnessing and experiencing a destination’s culture as a part of its hospitality landscape.

“When visiting any new country, I would like to see the reflection of the country at the hotel that I’m staying at; in the design of the hotel, or in the local food in the menus. Burj Rafal Hotel Kempinski’s design is inspired by the old Najdi house and presented in a contemporary way throughout the hotel. Our concierge team has all the best tourist attractions in Riyadh and is associated with the best tour operators in Riyadh.”
Park Hyatt Jeddah – Marina, Club and Spa has also bolstered its own cultural features by introducing a special package called ‘Culture at the Park’. Room accommodation including transportation to and from the historical area, Balad, and entrance to Abdalraouf Khalil Museum is provided.

With a Kingdom-wide eagerness to create a tourism legacy, spurred by region-wide engagement, KSA is swiftly, thoughtfully and powerfully charting its travel industry path.