The significant increase in the number of domestic and foreign tourists and visitors to the Kingdom of Saudi Arabia has highlighted the need to develop a larger range of hospitality projects to meet the growing demand for hotel rooms.
The tourism sector in Saudi Arabia set a record in 2022, after opening 12,000 hotel rooms, which is the highest rate in the world in the world of hotels and hospitality.
According to Knight Frank estimates, the strong growth rates are expected to continue until 2030, when the number of hotel rooms is expected to increase from about 128 thousand rooms currently to about 403 thousand rooms by 2030, which constitutes a jump of about 215%.
By 2030, the total number of new rooms will be distributed by 37% for 5-star hotels, 36% for 4-star hotels, 17% for 3-star and less, and 10% for hotel apartments.
The total cost of constructing these hotel rooms is $21.2 billion, but excluding the cost related to “giga projects” hotels such as the Red Sea, Qiddiya, and Neum, which alone will be responsible for 225,000 hotel rooms by 2030.
For comparison; The number of hotel rooms in the Emirates is currently estimated at 200 thousand rooms, while in Egypt it is 211 thousand rooms, and in Turkey it is about 455 thousand rooms.
This increase in the capacity of Saudi hotels comes in line with expectations to attract 100 million visits by 2030, amid the gradual improvement in numbers since the Corona pandemic.
The development of tourist destinations and the increase in entertainment events, such as the Riyadh season and the Saudi winter, and the work of the Saudi Tourism Authority, contribute to promoting them extensively locally and globally, which constitutes an incentive to increase the capacity of hotels, with the improvement of occupancy numbers.
The average occupancy rate for the period from January to August of this year increased by 10% compared to the same period last year, to record 58%, and the average cost of a hotel night during the period increased to 515 riyals.
RevPAR also increased by 36% compared to its level a year ago.