Saudi Arabia: A leader in hotel development

Saudi Arabia

Saudi Arabia’s Holy City of Makkah is paving the way for hotel development in the country with 24,133 rooms currently in the construction pipeline, according to a new report by TOPHOTELPROJECTS – commissioned by The Hotel Show Saudi Arabia 2016.

Riyadh follows Makkah with 10,053 rooms, while Jeddah has 6,980 rooms under development, with the majority of rooms expected to inaugurate over the coming five years.

Makkah therefore represents the Middle East and Africa’s second top city for the number of hotel rooms set to enter the market, behind Dubai, which has 43,714 rooms currently in the pipeline.

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Group event director, dmg events hospitality portfolio (organiser of The Hotel Show Saudi Arabia 2016), Christine Davidson noted: “With the holy cities of Makkah and Madinah forecast to exceed 17 million visitors by 2025, the number of local and international hoteliers looking to invest continues to grow. With the Abraj Kudai forecast to open in Makkah in 2019, adding 10,000 new rooms to the market, it is not surprising that Saudi Arabia leads the way in hotel construction.”

Within the newly published report, Carlson Rezidor Hotel Group is pin pointed as one of the top 10 international brands with the most pipeline projects in the KSA. These include two new hotels set to open in Makkah: Park Inn by Radisson Al Naseem Makkah (2016) and Park Inn by Radisson Aziziyah Makkah (2017).

District director, Rezidor Hotel Group Saudi Arabia, Basel Talal, who is also the general manager of the Radisson Blu Hotel in Riyadh, noted: “Both of these hotels offer privacy in highly accessible locations for pilgrims and Umrah travellers. The evolution of religious tourism has been a priority for Saudi Arabia’s Government over the past years and has resulted in considerable investment and interest from developers and operators alike.

“In addition, Umrah is now available the whole year and the Government has recently announced its intention to increase the number of visas over the coming ten years parallel to the completion of the ongoing infrastructure and transportation projects. A result this will, of course, mean an increase in the number of pilgrims able to make the journey, as well as smoothing out seasonality for the tourism industry in Makkah,” added Talal.

At the second annual Vision Conference at The Hotel Show Saudi Arabia 2016 in Jeddah, taking place in May, head of travel, hospitality and leisure advisory, Deloitte, Grant Salter will discuss ‘Market performance, trends and projects in Jeddah and Makkah’.

Salter noted: “The substantial rise in supply expected over the next few years in both Jeddah and Makkah will be interesting to observe as the supply and demand dynamics currently show a market in balance with occupancy and ADR relatively unchanged over the last 12 months. Makkah should be able to cope with the rise in supply expected but Jeddah could face headwinds.”

Meanwhile, projects and trends that are shaping the hospitality industry in the KSA will be discussed in more detail The Hotel Show Saudi Arabia’s Vision Conference, taking place from May 17-19, 2016, at the Jeddah Centre for Forums and Events.