Future plans
With five hotels already open in Riyadh, InterContinental Hotel Group manages one of the largest property portfolios in the city, and with five more hotels on the way IHG's India, Middle East & Africa chief operating officer Pascal Gauvin is optimistic that the “continued growth of the corporate traveller market will be one of the biggest opportunities in Riyadh.”
“Riyadh is a commercial hub and that is reflected by the number of corporate travellers staying with us. There has been strong economic growth in the city over the last few years, partly due to government investment.
When the King Abdullah Financial District is complete it will make Riyadh one of the Middle East’s main financial hubs and we will be opening two new hotels in the district to service the business travellers it will attract.
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This is in part why we chose Riyadh as our first Middle Eastern city to debut Hotel Indigo, our boutique offering” says Gauvin.
Representing another brand trying to benefit from the growing number of business travellers to the city, Golden Tulip MENA president Amine Moukarzel knows that they will have to work hard to ensure they can distinguish themselves from the ever increasing levels of competition.
“We will focus on making sure that we cater to the growing market segment who wishes to have their accommodation at hotel apartments. The Golden Tulip and Tulip Inn brands appeal to a middle and upper middle market, which makes us well positioned to appeal to such customers.
One of the biggest challenges we face is ensuring that we continue maintaining our standards to the required levels,” says Moukarzel.
STR Global’s Philip Wooller concludes that “while Riyadh is still a very young market, with the full weight of the Saudi government behind it, it has the potential to become a real force in the Middle Eastern market and real competition to other Middle Eastern cities”.
“You only have to look at the total hotel supply across Saudi Arabia and realise that it’s still tiny in comparison to other markets in the area. So with the continued investment from hotels this has the potential to become a great story in time,” Wooller asserts.
Top three trends
- Market diversification: emergence of branded quality serviced apartments and economy hotels, which at the moment are undersupplied in the market, will bring new travellers but put pressure on rates.
- Corporate travellers: hoteliers will need to tap into the continued growth of the corporate traveller market, but be careful not to become over-reliant on narrow customer bases.
- The labour force: job opportunities will be plentiful, but hoteliers aired concerns over Saudisation quotas and the availability of visas for other nationalities.
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