ARABIAN HOTEL INVESTMENT REPORT:
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There was much to discuss at the Arabian Hotel Investment Conference (AHIC) 2019. Hot topics included rising competition in the food and beverage (F&B) space; making the most of new digital technologies; mitigating oversupply in the GCC’s luxury hotel segment; developing local talent; and the rise of Chinese visitors to the region.
But the biggest issue of all from a regional point of view, is the opening up of Saudi Arabia’s tourism sector to luxury lifestyle travel and to the entertainment industry.
Riyadh’s Vision 2030-inspired programme to develop Saudi tourism in order to create jobs and drive diversification is one of the most exciting developments ever to happen for the Gulf’s hotel investors, operators and suppliers. It is genuinely transformational at a regional level and could not come at a more important time for the region’s tourism industry.
It has been a challenging few years for Gulf hoteliers. The slowdown in business travel coupled with the opening up of new hotels and restaurants has hit occupancy rates and yields. And while cost efficiencies might top the agenda today, new revenue opportunities are essential for the long term.
Saudi Arabia has long been the region’s biggest tourist destination in terms of international visitors. But a sizeable share of these visitors, more than 8 million out of a total of about 18 million, have been Hajj or Umrah pilgrims travelling on restrictive pilgrim visas.
Saudi’s lifestyle and entertainment sectors are untapped. And in a country of 33 million people with thousands of miles of pristine coastline, incredible natural assets and major cultural landmarks, there is a vast opportunity across all segments of the industry.
But nothing ever comes easy in the kingdom, and it will take time for reforms and investments to take root.
Hospitality report in features
- Overview: Gulf hotel operators revisit growth plans
- Saudi Arabia: Riyadh sharpens its tourism vision
- Red Sea project: Investors line up for luxury opportunity in Saudi Arabia
- Amaala: Red Sea Riviera plans gather momentum
- Bahrain: Manama moves to the next phase of its tourism plan
- Technology: Guest expectations drive technology adoption in the hotel sector
- Infographic: Hotel headwinds persist