More than 30,000 Hotel Rooms Under Development in Saudi Arabia, as Kingdom Prepares to Cater to Pent-up Demand from Returning Pilgrims

• KSA’s overall RevPAR stands at 52% due to pandemic’s impact on holy cities

• Al Khobar outperforms other markets as hotel demand passes pre-2020 levels

• ATM Saudi Forum key focus at ATM 2022, amid ongoing market recovery

A total of 32,621 hotel rooms are currently under construction in Saudi Arabia, as the kingdom prepares to meet pent-up demand from pilgrims returning to its holy cities. That’s according to the latest research from STR, commissioned by Arabian Travel Market (ATM) 2022, which will take place at Dubai World Trade Centre (DWTC) from Monday 9 to Thursday 12 May.

ATM Saudi Pavilion

The analysts found that the country’s revenue per available room (RevPAR) recovery index stands at 52 percent, noting that the absence of millions of Muslim pilgrims has significantly impacted hotel performance in Saudi Arabia. Medina and Makkah witnessed RevPAR rates of just 33 percent and 24 percent, respectively, in 2021.

Although significantly lower than pre-pandemic levels, KSA’s hotel performance registered year-on-year gains in 2021 and the sector’s recovery is expected to persist throughout the coming year, with pent-up demand driving further improvements as Covid-related restrictions continue to ease.

Danielle Curtis, Exhibition Director ME - Arabian Travel Market, said, “As was the case for markets the world over, the global pandemic had a major impact on Saudi Arabia’s hospitality sector. Even so, STR’s findings clearly point to an ongoing and sustained recovery, and we are looking forward to exploring the vast untapped potential of the kingdom’s burgeoning tourism sector at ATM 2022.”

Hotels in Al Khobar are currently outperforming those in Saudi Arabia’s other major cities, with RevPAR surpassing pre-pandemic levels in 2021. Riyadh, Dammam and Jeddah, meanwhile, recorded recovery index rates of 88 percent, 85 percent and 56 percent, respectively, last year.

In terms of outbound travel, research conducted by Colliers International shows that overseas journeys from the kingdom are set to grow to 6,075,000 in 2022, compared to an estimated 3,793,000 in 2021 and 4,839,000 in 2020. In the longer term, outbound tourist trips are expected to rise to 9,262,000 in 2025, although this figure would still be significantly lower than the peak of 19,751,000 recorded in 2019.

Outbound tourist expenditure is set to grow to SAR32.656 billion (USD8.7 billion) this year, compared to an estimated SAR19.734 billion (USD5.26 billion) in 2021 and SAR21.969 billion (USD5.86 billion) in 2020. Total expenditure is expected to increase to SAR54.624 billion (USD14.56 billion) in 2025.

Other takeaways from Colliers International’s analysis include the growth of travel related to ‘visiting friends and relatives’ (VFR) during the pandemic, which accounted for more than half of outbound trips (55 percent) in 2020, compared to 39 percent in 2019; and an increase in the average trip length, rising from 15.4 days in 2019 to 19.2 days in 2020.

With two sessions dedicated exclusively to the kingdom, attendees, exhibitors and delegates will have ample opportunity to take a deep dive into Saudi Arabia’s tourism, travel and hospitality industry at ATM 2022.

The first, ‘From strategy to reality, Saudi Arabia’s tourism vision comes of age’, part of the ATM Saudi Forum, will focus on infrastructure progress, niche markets and fresh opportunities, as the country works to attract 100 million annual visitors by 2030. The second, ‘Saudi Arabia’s blueprint for responsible tourism development’, will explore how sustainability, community inclusion, education and training, and the legacy impact of KSA’s broad-ranging tourism vision can offer a best-practice model for other global destinations.

The ATM Saudi Forum will feature high-level experts including Mahmoud Abdulhadi, Deputy Minister for Investment Attraction at the Saudi Arabian Ministry of Tourism, Captain Ibrahim Koshy, CEO, SAUDIA, Amr AlMadani, CEO, the Royal Commission for AlUla, Majed bin Ayed Al-Nefaie, CEO, Seera Group Holding, Fawaz Farooqui, Managing Director, Cruise Saudi, John Pagano, CEO, Red Sea Development Company & AMAALA and Jerry Inzerillo, CEO, Diriyah Gate Development Authority.

ATM 2022 will welcome a range of high-profile exhibitors from the kingdom, including the Saudi Tourism Authority, which has expanded its exhibition area by 40 percent compared to 2021 - as well as Saudia Airlines, Flynas, Seera, RED Sea Project, NEOM, Dur Hospitality, and first-time participant Al Hokair Group.

“While religious tourism will no doubt remain a mainstay for Saudi Arabia, the global travel community is also understandably excited about new prospects that are opening up thanks to the country’s growing investment in other segments,” added Curtis.

“As its post-pandemic recovery continues to gather pace, ATM 2022 represents the ideal forum in which to discuss the countless opportunities offered by the kingdom’s ever-expanding tourism market.”

Now in its 29th year and working in collaboration with the Dubai World Trade Centre (DWTC) and Dubai’s Department of Economy and Tourism (DET) - formerly the Department of Tourism and Commerce Marketing (DTCM) - ATM show highlights in 2022 will include, among others, a destination summit focused on the key source market of India, as well as Saudi Arabia.

Previously called Travel Forward, the revamped and rebranded ATM Travel Tech event will take place on the ATM Travel Tech Stage, hosting seminars, debates and presentations as well as the inaugural ATM Draper-Aladdin Start-up Competition.

The dedicated ARIVALDubai@ATM forum, meanwhile, will cover current and future trends for tour operators and attractions, focusing on growing business through marketing, technology, distribution, thought leadership and executive-level connections.

ATM will once again play an integral role in Arabian Travel Week, a festival of events dedicated to enabling travel professionals from all over the world to collaborate and shape the recovery of the Middle East travel industry through exhibitions, conferences, breakfast briefings, awards, product launches and networking events.

The UAE remains one of the most Covid-secure countries on the planet, with consistently low case rates and robust measures to ensure tourists' safety at every stage of their visit. Like its neighbouring emirates, Dubai is committed to maintaining the highest hygiene and safety standards. The World Travel and Tourism Council (WTTC) has endorsed its pandemic management, awarding the city a 'Safe Travels' stamp.

In line with the UAE government’s forward-thinking transition to a four-and-a-half-day, Monday-to-Friday workweek, this year’s edition of ATM will commence on Monday 9 May.

For more news about ATM, please visit, www.wtm.com.