Significant Growth in Middle East Hotel Projects as of Third Quarter 2024
Ahmed Bin Abdulqader ـ nabd–alhadath
The Q3 2024 Middle East Hotel Construction Pipeline Trend Report from Lodging Econometrics (LE) reveals an upward trend in the hotel construction pipeline, with a 4% increase in projects and a 7% increase in rooms compared to the previous year. The pipeline currently stands at 610 projects with 149,686 rooms.
As of the third quarter, 296 projects with 79,978 rooms are currently under construction, making up 49% of the total pipeline projects. Projects set to begin construction within the next year have seen significant growth, with a 36% increase in projects and a 51% increase in rooms compared to the previous year, totaling 140 projects and 36,260 rooms. Early planning projects have also increased, with a 7% increase in projects and a 5% increase in rooms compared to the previous year, totaling 174 projects and 33,448 rooms.
The report also shows a continued trend of brand conversions, reaching a record high of 47 projects and 10,390 rooms. This is an increase of 31% and 37% in rooms compared to the previous year. The luxury, upper upscale, and upscale chain scales dominate new hotel construction in the Middle East, accounting for 78% of the total pipeline with 477 projects and 119,063 rooms.
Saudi Arabia leads in the number of pipeline projects with an impressive 15% increase in projects and 18% in rooms, closing the quarter with 317 projects and 79,984 rooms. Egypt follows with 109 projects and 26,286 rooms, representing a 20% increase in projects and a 21% increase in rooms. The United Arab Emirates ranks third with 86 projects and 23,743 rooms, despite a decrease of 20% in projects and 13% in rooms.
The cities with the most construction projects are Riyadh with 90 projects and 18,067 rooms, Jeddah with 53 projects and 11,336 rooms, and Cairo with 40 projects and 8,905 rooms.
The Middle East opened 51 new hotels with 9,356 rooms in the third quarter of 2024. LE forecasts an additional 35 new hotels with 6,916 rooms to open by the end of the year. Projections for 2025 and 2026 suggest openings of 107 new hotels with 27,485 rooms and 121 new hotels with 25,030 rooms, respectively.
