Middle East and Africa Witness Increase in Hotel Pipeline Activity
SUMMARY – MIDDLE EAST AND AFRICA LEAD INCREASED HOTEL PIPELINE ACTIVITY WITH GROWING CONTRACTED ROOMS. SAUDI ARABIA AND UAE TAKE THE LEAD IN HOSPITALITY DEVELOPMENTS.
According to hospitality industry analytics provider STR, the Middle East and Africa region experienced a surge in hotel pipeline activity, distinguishing itself as the only region globally to do so. In December, the total number of hotel rooms under contract in the region increased by 1.1%, reaching 238,635 rooms compared to the same month in 2021. A report released by STR on Thursday highlighted Saudi Arabia and the UAE as the leaders in hotel construction activity, with 40,742 and 27,456 rooms respectively.
Ambitious Plans for Middle East And Africa Hotel Pipeline Development
Saudi Arabia, with its ambitious vision for domestic and international tourism, aims to deliver 310,000 hotel rooms by 2030. A recent report by global property consultancy Knight Frank outlined the kingdom’s plans to develop its hospitality market. It would involves an estimated cost of $110 billion for the delivery of the rooms under construction.
The UAE’s hospitality market is ready for substantial growth. According to Knight Frank’s September report, the market is expected to expand by 25% by 2030, adding an additional 48,000 rooms to its existing portfolio of 200,000 keys. The forecasted cost for delivering the planned hotel rooms is approximately $32 billion.
In December, STR data revealed that the Middle East and Africa demonstrated an upswing in hotel pipeline activity, with an increase in hotel rooms under contract during the fourth quarter. It also reveals the 6% annual increase in hotel rooms under final planning, totaling 41,086 rooms in the Middle East and Africa. However, construction activity in the region experienced a 5.8% decline, resulting in 122,686 rooms. Similarly, projects under final planning decreased by 6% to 38,147 rooms during the month. On a positive note, hotel rooms under planning witnessed an 11.5% increase, reaching a total of 74,863.
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