The MENA region is witnessing a surge in the combined value of hospitality and residential projects, totaling over $1.9 trillion, with Saudi Arabia, the UAE, and Egypt contributing 90% ($1.7 trillion) of these investments, according to a report by real estate consultancy firm Knight Frank.
Saudi Arabia leads with $1.2 trillion worth of hospitality projects in development, followed by the UAE with $300 billion and Egypt with $200 billion.
This significant investment underscores the region’s commitment to attract 160 million tourists annually by 2030.
Turab Saleem, partner and head of Hospitality, Tourism, and Leisure – MENA at Knight Frank, highlighted the Middle East’s remarkable growth in the travel and tourism sector, with a 46.9% increase in its contribution to GDP in 2023, the highest of any region globally.
The region’s tourism growth is driven by a 14.5% increase in jobs supported by the sector and over a $107 billion increase in its overall GDP contribution.
The introduction of simplified visa processes, robust marketing efforts, green initiatives, innovation and technology, improved airline connectivity, and personalized guest experiences are all contributing to the Middle East’s booming tourism industry.
In support of this growth, global real estate consultancy Colliers reported that a significant volume of hospitality-related transactions is in advanced negotiation stages, with high-profile properties expected to change hands soon.
James Wrenn, executive director and head of Capital Markets, MENA at Colliers, noted a strong appetite for the hospitality asset class, particularly in Dubai and Ras Al Khaimah, among both regional and international investors.
Meanwhile, Knight Frank’s Saudi Giga Projects Report revealed that Saudi Arabia’s real estate and infrastructure projects have surpassed $1.25 trillion, with commissioned projects valued at $250 billion.
The report highlighted Western Saudi as a central piece in the kingdom’s transformative vision, with $687 billion worth of real estate projects expected to be delivered by the end of the decade.
NEOM, the $500 billion megacity project, is progressing rapidly, with $70 billion of projects already awarded, 45% of which have been completed.
Riyadh remains a focal point for Saudi Arabia’s transformation, accounting for 18% of all real estate and development projects, with a combined value of $229 billion.