[Update] Saudi Arabia, the new Eldorado for hotel groups

3 min reading time

Published on 25 May 2023

Arabie saoudite

Saudi Arabia has been making a point of developing its tourist activity in recent years, attracting more and more visitors each year. But the country is now also attracting the attention of hotel groups who are determined to establish themselves on a long-term basis in this booming destination. Accor, IHG and Minor Hotels are all unveiling ambitious plans to expand in the country in the coming years.

With 42 hotels (16,334 rooms) already in Saudi Arabia, Accor intends to continue its momentum and double its presence in the country by 2027. In support of the Kingdom's Saudi Vision 2030 plan, the French group has also recently announced the signing of 3 contracts with major strategic owner partners, namely the Rua Al Madinah project in Medina, an urban development project in Riyadh, and an urban project agreement covering several cities with Amsa Hospitality.

Accor currently has 56 projects under development in the country in a variety of forms, mixing hotels and residences near major landmarks in the Kingdom. Thus, the Rua Al Madinah project in Medina will include a 142-room Fairmont hotel, 120 Fairmont residences, a 466-room Swissôtel and a 328-room Novotel, while the Riyadh project will include a 230-room Raffles hotel, a Sofitel residence with hotel services, and a resort of 60 MGallery villas.

The future of Saudi Arabia is extremely bright, and Accor is accelerating its development plans in response to growing demand from guests, locals, acquirers and investor partners for contemporary, multi-faceted hospitality experiences.

Sébastien Bazin, CEO, Accor

Meanwhile, Ennismore, the lifestyle arm of Accor, has signed a partnership worth 1.5 billion Saudi riyals ($400 million) with two Saudi entities: the Tourism Development Fund and Al Rajhi Capital investment fund. "We are seeing a major transformation with Ennismore's expansion programme for 35 hotels across Saudi Arabia and exposure to secondary cities in one investment," said Assem Raqaban, head of real estate at Al Rajhi Capital and former senior vice president of the Public Investment Fund.

Wahdan Al Kadi, commercial director of the Tourism Development Fund and chairman of the board of the Ennismore fund, said Ennismore's strategy is in line with the national tourism strategy under Vision2030, with, in Ennismore's case, over 2,000 hotel rooms in the initial phase. It is about creating destinations, not just hotels.

For its part, IHG currently operates 39 hotels in Saudi Arabia and is also looking to expand its presence, notably through the signing of a framework development agreement with Tashyid for Hotel Operations to develop 12 hotels under the Holiday Inn Express brand. The first property under this agreement will be built in Jeddah by June 2025.

Saudi Vision 2030 has created tremendous opportunities for the tourism and hospitality industry, and we are seeing growing demand for our brands across all segments.

Haitham Mattar, Managing Director India, Middle East and Africa, IHG Hotels & Resorts

Finally, Minor Hotels announces the signing of a memorandum of understanding with the Saudi Arabian Tourism Development Fund to jointly develop and operate high quality hotel and lifestyle projects focused on mountain resorts, wellness and urban hotels in the Kingdom. The first project under this partnership is expected to be announced in the second half of this year.

The signing of this MoU with the Saudi Tourism Development Fund represents a significant milestone for Minor Hotels, enabling the group to offer a wide variety of products ranging from experiential luxury to serviced flats, each creating a customised product for a niche consumer.

Dillip Rajakarier, CEO of Minor International Group and CEO of Minor Hotels

Accor

Accor

Hotel Group

  • Accor France
  • Offres d'emplois 34 currents job offers
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InterContinental Hotels Group

InterContinental Hotels Group

Hotel Group

  • InterContinental Hotels Group United Kingdom
  • Offres d'emplois 63 currents job offers
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Minor International

Minor International

Investor / Finance

  • Minor International Thailand
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Ennismore

Ennismore

Opérateur

  • Ennismore Europe
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