UAE cinema operators outline Saudi investment plans
Majid Al Futtaim will spend $545m on 600 screens in the kingdom, with Novo also eyeing Saudi
Cinema operators in the Gulf are targeting the Saudi Arabian cinema market that has seen heightened activity in 2018 as part of the socio-economic ambitions of the kingdom’s Vision 2030 programme. The UAE’s Majid Al Futtaim has revealed plans to invest $544.5m (AED2bn) towards the development of 600 cinema screens in Saudi Arabia.
The UAE company, which operates 355 screens at present, will invest the amount as it seeks to open the new Saudi screens “in the next three to five years”, according to Cameron Mitchell, chief executive officer of Majid Al Futtaim Cinemas.
Speaking at the MENA Cinema Forum currently under way in Dubai’s Grand Hyatt hotel, Mitchell added: “Overall, we will operate around 1,200 cinema screens across the region in five years’ time – that’s how fast we are going to expand. With the Saudi market opening, we see a lot of opportunities in the region’s cinema and entertainment industry.”
Mitchell added that Majid Al Futtaim Cinemas was also “employing a large local talent pool” to manage its entertainment assets in the kingdom, with 98% Saudisation achieved within its operations.
Novo Cinemas, meanwhile, said it may manage1,000 cinema screens within five years. The company currently operates 124 screens in 10 locations with 19,000 seats. Debbie Standord-Kristiansen, chief executive officer of Novo, added: “Saudi Arabia is obviously the market that will drive the growth and we are talking to our partners to open as many screens as the market demands.
“Although I do not have a budget in my mind, [we] could potentially operate 1,000 cinema screens five years down the line, depending on how the market evolves.”
At the event, it was revealed that the Gulf has 1,300 cinema screens in operation, with the majority of new screens due to open in Saudi Arabia in the years to come. Leila Masinaei, managing partner of Great Minds Events, said the GCC’s cinema industry “is coming of age with Saudi Arabia, the largest Arab economy, opening the market”.
Entertainment is rapidly gaining traction as a development segment in the region, with Saudi Arabia emerging as a major investment hub for leisure spend. According to JLL’s Q2 2018 Jeddah Real Estate Market report, the expansion of Jeddah’s entertainment sector and cultural offerings bodes well for several sectors in the kingdom in the long-term, bringing long-term growth to the city’s hotel, residential, and retail industries.
Among the entertainment schemes under way in the kingdom is the Qiddiya city – which is already creating “digital transformation” jobs for Saudis. Phase 1 of the development will open in 2022, and upon full completion, Qiddiya will be double the size of Disney World in Florida, US.