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The Saudi hospitality sector is witnessing significant growth on a 69% hike in hotel occupancy rates in 2023, from 59% in 2022, Knight Frank’s Partner and Head of Hospitality, Tourism & Leisure Advisory for MENA region, Turab Saleem, told Argaam.
On the sidelines of the Future Hospitality Summit (FSH) in Riyadh, Saleem expected the local hotel occupancy rates to exceed 70% in 2024 to keep pace with increasing demand.
A total of 320,000 hotel rooms are planned to be built in Saudi Arabia, enabling the Kingdom to reach major regional achievements by possibly adding 500,000 rooms.
He pointed out that the Kingdom is exceeding its tourism objectives faster than expected. The target of reaching 100 million tourists was achieved in 2023 instead of 2030, hence the new goal was raised to 150 million tourists, reflecting the great progress in achieving these ambitious goals.
The Saudi Tourism Authority (STA) and the Ministry of Tourism are making strides to promote Saudi tourism at the global level. This is besides stimulating investments in mega tourism projects such as Diriyah, Qiddiya, NEOM, and Rua Al Madinah.
Supply and demand play a key role in hotel room prices, as demand surpasses supply, translating into higher prices and hotels running at full capacity in certain periods, Saleem stressed.
The Saudi hospitality sector is moving towards a bright future with a systematic strategy, focusing on developing all the cities in the Kingdom, not just the main ones.
The tourism infrastructure is also being upgraded, through the development of 13 airports, starting with the mega airport in Riyadh, and the announcement of Riyadh Air, all contributing to boosting the local tourism sector, Saleem concluded.
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