Saudi Arabia targets massive growth in hotel capacity
A total of 450,000 rooms by 2030 will give the Kingdom the highest accommodation levels in the GCC
Saudi Arabia is gearing up for a major expansion in its hospitality sector by developing 315,000 new hotel keys by 2030, according to a new report on the future of hospitality in the region by Knight Frank.
This growth, according to the firm, will see Saudi Arabia’s hotel room inventory swell to become larger than Dubai’s current 140,000 keys. The development of the hospitality sector is said to be a cornerstone of the Kingdom’s economic diversification plans, and a vast variety of initiatives for attracting global brands – throughout the Kingdom – are already well under way.
Faisal Durrani, Partner – Head of Middle East Research, Knight Frank, explained: “The volume of hotel room keys planned to be delivered in the Kingdom by 2030 is nothing short of incredible, with a total likely stock of close to 450,000 hotel rooms. For context, the UAE today has a combined total of around 200,000 rooms, including Dubai’s 140,000 keys, so Saudi is gearing up to see close to 58% more than this figure.
In mid March 2023, Marriott joined forces with Neom to open three new properties and, in earl April 2023, PKF Hospitality Group said that Saudi Arabia is the ‘single biggest hospitality opportunity’.
“A major part of the success of the Kingdom’s future tourism and hospitality market will be its domestic tourism sector. The sector is already alive and thriving, with 65% of Saudis already travelling within the Kingdom between one- and three- times a month. What’s fascinating however is the fact that 58% of Saudis we spoke to as part of our 2023 Saudi Report don’t stay in hotels.”
Addressing the need for diversity in accommodation options, Durrani noted, “The prevalence of large families traveling together may clearly be a factor, but so is cost, quality and location, with these three reasons being cited by our 2023 Saudi Report respondents. Notably, just 17% of the planned hotel supply falls in the three star or below category, and with 56% of the Kingdom’s population aged below 35, the demand for various accommodation types will likely continue to emerge as a significant consideration and a major driver in terms of capacity for the industry.”
In late April 2023, Wynn Resorts revealed the name and design vision of its $3.9bn RAK hospitality project.
