According to a recent report by Knight Frank, a renowned property consultancy, Saudi Arabia plans to significantly boost its hospitality sector by adding a whopping 320,000 new hotel rooms by 2030.
Presently, a substantial 66 percent of the kingdom's existing hotel offerings belong to the upscale and luxury categories, a figure poised to rise to 72 percent, equating to around 251,500 rooms.
Driven by an ambitious goal of welcoming 150 million visitors by 2030, a 50 percent increase from previous targets, the Saudi government is actively strategizing to allure international travelers. Turab Saleem, Partner and Head of Hospitality, Tourism, and Leisure Advisory at Knight Frank, emphasized the implementation of diverse cultural and entertainment initiatives across the nation to complement existing attractions like the Jeddah F1 Grand Prix and theme parks.
The surge in tourism is evident, with spending during the first half of 2023 rising to SAR87 billion, a remarkable 132 percent increase compared to 2022. Additionally, international arrivals spiked to 14.6 million, marking a 142 percent upsurge, with significant contributions from neighboring Muslim-majority nations such as Bahrain, Kuwait, and Egypt.
The hosting of the 2030 World Expo is anticipated to inject over $94 billion into Saudi Arabia's economy, attracting an estimated 40 million visitors during the six-month event. This monumental expansion underscores the imperative of providing adequate accommodation for hotel staff, ensuring the sector's sustained success. Faisal Durrani, Partner and Head of Research for the region at Knight Frank, emphasized the importance of investing in key worker accommodations to address staffing challenges and create lucrative assets.
Looking ahead, Knight Frank's research indicates that upscale and luxury accommodations will dominate the kingdom's hospitality landscape, with around two-thirds of planned hotel rooms falling into the 4-star and 5-star categories. As such, an estimated 232,000 to 387,000 key workers may be required to cater to the upscale segment alone.
Furthermore, projections suggest shifts in the landscape of international hotel operators, with Accor poised to claim the second spot and Marriott International expected to emerge as the largest hotelier presence in Saudi Arabia by 2030.
Religious tourism is also set to play a significant role, with expectations of attracting 30 million visitors by 2025, projected to soar to 50 million by 2030.
