Riyadh, Jeddah to have 16,000 new hotel rooms by 2018

Over half of rooms will be part of new 5-star hotel developments with ambition expansion plans in place

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Major Saudi cities such as Riyadh and Jeddah are forecast to see an increase of 16,000 new hotel rooms by 2018, according to a new report published on Wednesday by Jones Lang LaSalle (JLL) for the Hotel Show Saudi Arabia 2015.

Of these, over 50% will be part of new 5-star hotel developments, as international hotel brands put in place ambitious expansion plans. The number of rooms in Jeddah is expected to increase by 2,700 in 2015 alone.

AccorGroup has plans to open nearly 10 hotels by 2018, while current market leader, InterContinental Hotels Group, which has 24 hotels throughout the Kingdom, has announced the opening of a further nine outlets including the world’s largest Holiday Inn in Makkah.

“Saudi Arabia has been one of our strongest markets and a key focus for us within the region since we entered 40 years ago,” said Pascal Gauvin, Chief Operating Office, India, Middle East & Africa at InterContinental Hotels Group (IHG).

“Our largest presence in the Middle East is in Saudi Arabia where we have 24 hotels open across our InterContinental, Crowne Plaza and Holiday Inn brands, and a further nine in the pipeline due to open in the next three to five years,” he said.

According to another report published by Euromonitor International for the Hotel Show Saudi Arabia 2015, the Saudi travel market is currently booming owing to the launch of the “Umra plus” visa introduced in 2014 that enables pilgrims to visit any city of the country freely after performing their religious duties.

In recent years an ambitious plan to bring in more foreign investment has led to various industrial areas including the King Abdullah Economic City (KAEC), alongside large-scale expansion projects currently being carried out at the Holy Mosques, especially in Makkah.

It is no surprise that most of the private sector development in Makkah is focused on hospitality with more than 22,000 keys expected to enter operation by the end of 2016, said Ismail AlAkamal, Director at AlKamal International Saudi Arabia.

“This opens numerous opportunities for all verticals catering for this unique market and at the same time presents a few challenges,” he added.

This article was first published in the Saudi Gazette on April 22, 2015.

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