Saudi Arabias Ambitious Tourism Drive

Saudi Arabia's ambitious tourism drive

KSA is currently promoting a variety of efforts to allow tourist growth, including the liberalization of immigration regulations and the development of tourism infrastructure.

Author

Report Highlights

The key projects announced by the Public Investment Fund of Saudi Arabia in 2018 include Qiddiya, The Red Sea Development, Amaala, NEOM, Al Ula, and Wadi Al Disah Development.

KSA is currently promoting a variety of efforts to allow tourist growth, including the liberalization of immigration regulations and the development of tourism infrastructure.

With business tourism still to kick off, a higher demand for flexibility in the hotel industry is foreseen.

Imagine a country with the financial muscle to transform its natural wonders into well-designed, cutting-edge tourism attractions. Saudi Arabia is that country, a Kingdom with a high and increasing demand for domestic and international tourism that is undergoing one of the world’s most significant transitions. Saudi Vision 2030 is a strategy framework for reducing Saudi Arabia’s reliance on oil, diversifying the Saudi economy, and developing public service sectors such as health, education, infrastructure, recreation, and tourism. Right before the epidemic, the kingdom was launching in a new era of targeted historical tourism. The hospitality industry was one of the most hit by the COVID-19 outbreak. Regional and global travel restrictions suddenly interrupted hotel client inflows, forcing several facilities to close temporarily. A new era has come; it is not what anyone expected. However, where there is a will there is a way, Covid-19 did slow the development progress but the spirits remained unbroken.

KSA is currently promoting a variety of efforts to allow tourist growth, including the liberalization of immigration regulations and the development of tourism infrastructure. The developments of unique mega-tourism projects as well as the recent streamlining of visa procedures will enhance tourist visits to Saudi Arabia, therefore benefiting the country’s hospitality sector.
The key projects announced by the Public Investment Fund of Saudi Arabia in 2018 include Qiddiya, The Red Sea Development, Amaala, NEOM, Al Ula, and Wadi Al Disah Development. To capitalize on the rise of domestic tourism, approximately 90 distinct hotel and resort ideas are now in the works outside of the four main cities of Riyadh, Jeddah, Makkah, and Dammam / Al Khobar. Aside from the Red Sea shoreline and Al Ula, Tabuk, Abha, and Jazan will also witness substantial changes in their hospitality and tourism offerings. The long-term future for the KSA hospitality sector appears promising, as the development of government-led tourist initiatives will definitely contribute to the creation and evolution of a distinct tourism industry in the Kingdom, in keeping with Vision 2030’s economic diversification goal. It also intends to expand the number of tourists through Hajj and Umrah, which are now a substantial contributor to the Kingdom’s total number of visitors, from around 19 million to approximately 30 million by 2030.

The hospitality business in Saudi Arabia has a mix of international brands and chain hotels as well as domestically developed chain hotels. Many well-known global brands have entered into numerous strategic collaboration programs with major Middle Eastern hospitality businesses operating under management contracts with respected organizations. Despite the Kingdom’s lockdown measures, residential construction activity remained strong, with over 60,000 units completed by 2020. Riyadh and Jeddah have total residential supply of 1.3 million and 835,000, respectively. The objective continues to strike a balance between growth and stability, as well as to strive toward long-term economic sustainability through diversification and to provide a good quality of life for people and residents. This is reflected in the 2021 budget of SAR 990 billion (USD 264 billion), which prioritizes investment in health, social development, and education. When under construction projects and those scheduled to finish by the end of 2022 are included, the supply of quality hotel rooms in Riyadh, Jeddah, and Dammam is expected to increase by 29 percent, 55 percent, and 47 percent, respectively.

With business tourism still to kick off, a higher demand for flexibility in the hotel industry is foreseen. Many hotels were also tasked with managing the kingdom’s mandatory quarantine. One scenario is the remodeling of underutilized areas, such as transforming meeting and event facilities into co-working spaces or business offices. Another scenario has hotels turning to branded permanent residences and some are being used as quarters for the first responders and also as quarantine centers.

Saudi Arabia is also promoting private investment, with plans to significantly increase the country’s current and prospective attractions, as well as its transportation infrastructure. Saudi Arabia aspires to become a significant tourist destination by 2030, with tourism capital expenditure estimated to exceed SAR 200 billion (USD $ 54 billion) during the next ten years.

How does Land Sterling brighten up this scenario? We offer a variety of advisory services throughout the stages of development cycles. Be it market research, strategic studies, technical reports or construction engineering evaluations, we are here to make a mark. Land Sterling extends an incredible team of strategic consulting firms that provide real estate, infrastructure, and urban economic consulting services to Middle Eastern and African developers, owners, occupiers, institutional investors, and government agencies. We e, services, and expertise to deliver innovative, personalized, high-quality, and cost-effective solutions. Land Sterling strives to provide cutting-edge services, and hospitality relies heavily on quality service. We can all agree that quality is the product of due diligence which leads to excellence and Land Sterling delivers nothing short of just that.

Recent
Publications