Saudi Arabia’s bid to create a new level of tourism in its country is well under way, and the country is expected to see 362,000 new hotel rooms delivered by 2030.
Transformation of the sector will see around USD110 billion invested in new infrastructure, property across several segments, and new tourism destinations and offers. All of this is covered within a grand masterplan, Vision 2030, which will put the Kingdom firmly on the international tourist map.
International arrival numbers on the rise
Research ahead of the 2025 Future Hospitality Summit, held in Saudi Arabia in May, points to the scale of investment opportunities in Saudi Arabia, for both local and international investors. Visitor numbers are already rising strongly. In 2024, the Kingdom welcomed 30 million international visitors, a number up from 27.4 million the previous year. Consultant Oussama El Kadiri, head of hospitality at Knight Frank, commented:“Saudi Arabia’s tourism sector presents a compelling investment landscape, evidenced by its record-breaking SAR 444.3bn GDP contribution in 2023, accounting for 11.5% of the national economy.”
Analysis by STR suggests that hotel revenues in Saudi Arabia continue to improve. In the first three quarters of 2024, the figure was up 3.5% on 2023, and 26.5% ahead of pre-pandemic levels in 2019. Riyadh hotels saw room rates up 16% year on year, while for Medina, the increase was 5%.
Helping to provide confidence in the future growth in visitor numbers is a strong roster of international events, already secured by the Kingdom. These include the 2029 Asian Winter Games, the World Expo 2030, and global soccer showcase, the FIFA World Cup in 2034. As well as driving footfall, such events help to show off Saudi Arabia to a global audience.
“Saudi Arabia is undoubtedly one of the most exciting destinations in the world, undergoing a remarkable transformation into a world-class tourism hub,” said Philip Wooller, senior director, Middle East & Africa at STR. “The key to sustaining this momentum lies in balancing the influx of new hotel developments with a competitive market edge.
A substantial construction programme
The Top Hotel Projects database lists well over 300 live hotel development projects across Saudi Arabia. As well as growth in established conurbations, a number of new destinations are in development, supported by international hotel brands. AlUla, for example, an ancient city with stunning landscapes, is seeing development that includes Aman and Janu luxury resorts, plus a Six Senses from IHG, and a Marriott Autograph Collection hotel.
One key destination that is growing its tourism offer is the reglious pilgrimage destination of Makkah. There, substantial hotels are being constructed to support the increasing numbers of religious tourists. A Fairfield by Marriott, for example, has 1,376 rooms, while the Crowne Plaza Makkah Bevan, currently under construction, has 1,200 rooms. Also represented in the destination is Grand Hyatt, Novotel, Ibis, Taj and Kempinski, among other international brands.
