The hotel construction sector in the Middle East is experiencing robust growth, as evidenced by Lodging Econometrics’ Middle East Hotel Construction Pipeline Trend Report Q3 2024.
The region ended the third quarter with 610 projects totaling 149,686 rooms, reflecting a year-on-year (YOY) increase of 4% in projects and 7% in rooms. “These figures demonstrate the continued momentum in the region’s hospitality sector,” the report highlights.
Of these, projects in active construction represent almost half of the total, with 296 projects and 79,978 rooms currently in progress. Notable growth was observed in projects scheduled to begin construction in the next twelve months. This growth increased by 36% in the number of projects and by 51% in the number of rooms, to a total of 140 projects and 36,260 rooms.
Meanwhile, the early planning stages saw an incremental year-over-year increase of 7% in the number of projects and 5% in the number of rooms, reaching 174 projects and 33,448 rooms.
Brand conversions in the Middle East are at a record high, with 47 projects and 10,390 rooms. “Conversions in the Middle East increased by 31% year-on-year in number of projects and 37% in number of rooms, indicating strong investor confidence,” the report found.
The luxury, upper and luxury segments continue to dominate, accounting for 78% of the region’s total pipeline.
The luxury segment in particular has seen a sharp increase, with a record number of 173 projects and 40,113 rooms – an increase of 7% based on the number of projects and 21% based on the number of rooms year-on-year.
This trend underlines the region’s focus on attracting luxury travelers. “The emphasis on luxury is in line with the Middle East’s vision to position itself as a premier global destination for affluent tourists,” the report said.
Among countries, Saudi Arabia leads with a remarkable 15% year-on-year growth in projects and an 18% increase in rooms. The Kingdom’s pipeline now stands at 317 projects and a record 79,984 rooms.
Egypt follows with 109 projects and 26,286 rooms and achieves a remarkable year-on-year increase of 20% in projects and 21% in rooms. The UAE, with 86 projects and 23,743 rooms, ranks third despite a 20% decline in the number of projects and 13% in the number of rooms year-on-year.
Major cities such as Riyadh, Jeddah and Cairo are leading in construction activities. Riyadh has 90 projects and 18,067 rooms, while Jeddah and Cairo follow with 53 projects/11,336 rooms and 40 projects/8,905 rooms, respectively. Cairo’s growth is particularly significant, with a 21% year-on-year increase in projects and 16% in rooms.
