Saudi Arabia’s Dur Hospitality has signed a franchise agreement with Marriott International to operate its hotels in the kingdom.

Dur Hospitality is in the design phase of developing a 150-room and serviced apartment hotel in Yanbu for Marriott. The hotel will be Courtyard branded and the apartments Residence Inn; they will be built on a 7,467 square metre plot of land.

The hotel will cost SR87m ($23m) to develop and operation is expected to begin in late 2018 or early 2019. Speaking to MEED on the sidelines of the Arabian Hotel Investment Conference (AHIC), Dur Hospitality’s CEO Badr al-Badr said the main contract award will be tendered in five months.

“We have started the design and are half way through,” said Al-Badr. Design for the seafront hotel, which will be three or four stars, is being carried out by Henning Larsen Architects.

In terms of the type of company being sought for the main contract, Al-Badr said: “We don’t focus on only price, but look at their track record in building hotels, the quality and their track record in bringing in good people.”

The hotel will focus on attracting business travellers and local tourism. “Yanbu is seeing a lot of growth in visitors due to the projects there,” he said.

Dur Hospitality is also developing the Jubail Holiday Inn, and Al-Badr said the winning bid for the main contract award will be announced in May.

Two years ago, Dur Hospitality announced SR1.5bn plans to develop 14 new hotels around the kingdom. Marriott Yanbu is the fourth in those plans, joining developments in cities including Jubail and Jeddah.

Al-Badr said the company is also looking at secondary cities, including Taif and Hail. Taif is considered the second gateway to Mecca, and the government is planning to develop the kingdom’s fifth international airport in the city.

Al-Badr said he is not considering an expansion outside of Saudi Arabia. “It is our competitive strength,” he said. “We understand the Saudi market and it provides many investment opportunities.”

The Marriott will have five hotels in Saudi Arabia once the planned Yanbu development is complete, all of which will be operated by Dur Hospitality.