What Saudi Arabia's $27bn tourism push means for construction
Hotels, malls, and the region's the largest indoor ski slope and snow park projects are to be built in the years to come
Saudi Arabia General Investment Authority (Sagia) and Saudi Commission for Tourism and National Heritage (SCTH) have announced $27bn agreements with local and international investors, such as Triple 5 – which through a $9.9bn (SAR37.5bn) agreement will develop mixed-use destinations across Saudi Arabia – and the UAE’s Majid Al Futtaim, which will develop a shopping mall with the region’s largest indoor ski slope and snow park, with the $5.3bn (SAR20bn) agreement to see the creation of 12,000 jobs in Saudi Arabia – all in addition to various hospitality schemes in Qididya and Neom.
Signed at the Ritz-Carlton hotel in Riyadh, the agreements also include local companies and cover a range of associated services required for the tourism industry in Saudi Arabia, such as real estate, food and beverage, and facilities management (FM).
Two MoUs were signed with Al Khozama Company by SCTH on the Mayasem Project and Harbour Project in Jeddah, in addition to investment projects in the real estate, F&B, and FM and service delivery sectors.
Diriyah Gate Development Authority also signed two MoUs involving SCTH – one each with Aman Resorts & Hotels and Greg Norman Golf Design to respectively develop a 40-room hotel in Al Bujairi and a 27-hole golf course in Wadi Safar.
Four MoUs were signed by SCTH with Saudi Arabian Airlines (Saudia), the national carrier of Saudi Arabia, to launch commercial flights to the $500bn (SAR1.9tn) Neom gigaproject, create Saudi Arabia’s first destination management company, launch a joint initiative to promote The Red Sea Project, and work with Royal Commission for Al-Ula.
Other MoUs worth $9.6bn (SAR36.25bn) were also signed by SCTH for investment projects with Alshaya Group, Shomoul, Radisson, Alrajhi Investment, and Seera Group.
Sagia also signed numerous MoUs and agreements during the ceremony, the most notable of which were the Triple 5 and Majid Al Futtaim deals.
India-founded Oyo Rooms entered a $1bn (SAR4bn) agreement that will see the start-up buy at least 10 high-end and luxury hotel properties in Saudi Arabia.
Nenking Group and Ajlan Brothers formed a $399.5m (SAR1.5bn) joint venture to build a lifestyle project in Riyadh, whilst FTG Development signed an MoU to build a hotel, a waterpark, and a retail development within the 334km2 Qiddiya entertainment city, in addition to a 1,500-room hotel in Neom and another hotel between Jeddah and Makkah.
Ireland’s Kerten Hospitality was granted an investment licence worth $71.9m (SAR270m) by Sagia to develop mixed-use projects in Saudi Arabia, whilst British outfit Tetrapylon was approved for a $665,887 (SAR2.5m) investment licence to coordinate with tour operators in North America, Europe, and Asia to promote Saudi Arabia as a tourist destination.
Commenting on the agreements, Sagia’s governor, Ibrahim Al-Omar, said the private sector would play a key role in unlocking the potential of Saudi Arabia’s tourism market, which he said had the elements and fundamentals required to succeed.
SCTH’s chairman, Ahmad Al Khateeb, said the agreements would encourage more businesses from the world to invest in Saudi Arabia’s tourism sector.