Premier Inn plans 50 Mid-East hotels in 10 years

Premier Inn, the UK budget hotel chain, will open a minimum of 25 hotels in Saudi Arabia over the next ten years in connection with a local partner, its managing director has said.

Britain’s biggest hotel brand plans to open 50 hotels in the GCC and Levant countries over the next decade. The chain’s initial schedule – to open 50 outlets within six years - was pushed back by four years due to the onset of the financial crisis, said Darroch Crawford.

“The dates keep moving because things have slowed down a little but certainly within the next ten years we’ll look to have at least 50 hotels and be represented in all major cities in the Middle East,” Crawford, managing director of Premier Inn Hotels, told Arabian Business.

Premier Inn, which is owned by UK conglomerate Whitbread, has four existing hotels in the UAE and has identified Saudi Arabia, the Gulf’s wealthiest state, as a potentially lucrative market for its mid-price hotels.

“After the UAE and Qatar, [Saudi Arabia] is our next development target…we have a joint venture partner lined up,” Crawford said.

“We believe [we’ll open] at least 25 hotels in Saudi Arabia. It’s got the biggest potential of all of the countries in the region because of the size and the population. It could be more; we have 592 hotels in the UK alone. If we can do 592 in the UK then surely you can do 25-plus in a country the size of Saudi Arabia.”

Land prices in Saudi Arabia have increased by more than 30 percent during the first six months of 2009, hiking up the cost of prime, inner-city real estate. As a result, the no-frills chain will concentrate on secondary cities in the kingdom.

“Land is not cheap in the cities and it may well be that the biggest opportunity for us is actually in secondary towns and cities where there is actually no supply at all,” said Crawford.

Other planned Premier Inn hotels in the region include Doha – scheduled to open in the first half of 2012 – and Abu Dhabi National Exhibition Centre, which is expected to begin operations in September, 2011.

“If you look at the region as a whole, internationally-branded budget hotels are almost unknown so there’s fantastic potential [for us],” said Crawford.

“Dubai is getting to a point where it has a reasonable coverage but Abu Dhabi has only one, until we get there. In most major cities in the region there isn’t any supply at all in that sector.”