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Al Khobar third in Saudi hotel development

by Jumana Abdel-Razzaq on Mar 20, 2017

Filippo Sona, Head of Hotels – MENA at Colliers International.
Filippo Sona, Head of Hotels – MENA at Colliers International.

Al Khobar has come in third as the top area for hotel development in Saudi Arabia with 20 hotel projects currently underway, a new report reveals.

According to the 2017 Saudi Arabia Hotel Construction Overview report by TOPHOTELPROJECTS, Al Khobar has overtaken long-term hub for religious tourism Makkah (19 projects) and now follows closely behind Jeddah (44 projects) and Riyadh (48 projects).

Hospitality experts in the region are attributing the surge in hotel development in Al Khobar, part of the third largest metropolitan area in the kingdom, to the industry recognised potential of ‘secondary’ cities outside of Saudi Arabia’s key visitor destinations.

Filippo Sona, Head of Hotels – MENA at Colliers International, said: “Outside the Kingdom’s major cities including Riyadh, Jeddah, Makkah and Madinah, there are around 22 smaller cities with huge potential for hospitality development of any kind.

“Al Khobar benefits from its location, with a steady stream of business travellers due to its port. A seaside location with beach resorts and directly on the border to Bahrain, it also welcomes savvy Bahraini tourists looking to explore what Saudi Arabia has to offer.”

Emerging destinations in kingdom also include the industrial city of Jubail and Al-Hasa, a green area well connected with Qatar and popular with domestic tourists, Sona added.

“Major hotel brands including Novotel, Park Inn and Intercontinental are already placing these destinations on the global map. Occupancy rates are historically high across the country, tourism figures are on the increase and its some 27 million residents are travelling more than ever before,” he said.

“With 175,000 rooms in the market at present and several more hotels under construction, there is the potential to more than double the number of rooms in the Kingdom through the opportunities presented through these secondary cities.”

Saudi Arabia is expected to see a record 68 new hotels and 29,033 hotel rooms open across its major cities in 2017.

Along with the opening of Abraj Kudai, which will be the world’s largest hotel located in Makkah, Nobu Hospitality and Rocco Forte Hotels are international brands that will also enter the Saudi Arabian market for the first time this year.

Business travellers are forecast to descend on Jeddah next month for the 5th edition of The Hotel Show Saudi Arabia, which sees 1000s of hospitality industry professionals each year.