Saudi Arabia's hotel industry continues on its trajectory to a full recovery with Jeddah's room occupancy and tariffs in November surpassing pre-pandemic levels, Arab News writes.
A report released by global hospitality data provider STR showed the key performance indicators — occupancy level, average daily rates and revenue per available room — in November to be higher than pandemic levels by 16.2 percent, 13 percent and 31.3 percent respectively. Despite the rebound from pandemic numbers, the market’s occupancy level was its lowest since April 2022, while ADR and RevPAR were the lowest since February 2022.
STR’s preliminary data for November showed the occupancy level of Jeddah's hotels reached 54.5 percent last month, with Jeddah hoteliers quoting ADRs of SR586.71 ($156) and earning RevPAR of SAR319.50. According to the daily data from the report, the highest occupancy level of 75.2 percent was recorded on Nov. 30 – the only day of the month that the metric came in above 70 percent.
Of all the industries impacted by the pandemic, the hospitality sector was the worst hit in Saudi Arabia and the Gulf, as in all other territories.
In 2020, hotel occupancy rates declined to 49 percent in Riyadh from 60 percent in 2019. Likewise, Makkah witnessed a decline from 61 percent to 25 percent, and Jeddah from 58 percent to 37 percent, according to professional services firm Deloitte.
When working on their post-recovery plan, Saudi Arabia factored in tourism as a major sector to focus on. The pace of growth is gathering steam as Saudi Arabia works to honor its Vision 2030 pledge to attract 100 million annual visitors within eight years.
Speaking at the World Travel and Tourism Council Global Summit in Riyadh last month, Saudi Minister of Tourism Ahmed Al-Khateeb announced the Kingdom is offering investment opportunities worth $6 trillion in the travel and tourism sector through to 2030. “We built our tourism industry against the backdrop of a global disaster (COVID-19 pandemic). And we now have $6 trillion of investment opportunities through 2030,” said Al-Khateeb. He added: “We value collaboration, we have proved that it will work. Our shared commitment to partnerships will drive the global industry forward. Saudi Arabia is reimagining tourism, making use of the power of partnership and ensuring that no one is left behind.”
Saudi Arabia’s massive investment in mega projects, including the $500 billion NEOM City and AlUla, will contribute to positioning the Kingdom as a major travel and tourism destination, Julia Simpson, president and CEO of the World Travel and Tourism Council, told Arab News earlier this year. The travel industry, which was worth $9.6 trillion before the COVID-19 pandemic, was cut in half during the pandemic.
By next year, however, it is expected to climb to $10 trillion, she said. Simpson added that the Kingdom’s travel industry will witness significant growth and is projected to add $100 billion to the economy by 2032, as it continues to boost tourism investments. “All the investment that the Saudi government is making in developing what is a really beautiful country and opening up for travel and tourism is bearing fruit,” said Simpson on the sidelines of the Future Investment Initiative in Riyadh.
