Market Size of Hospitality Industry In The Kingdom Of Saudi Arabia
Study Period | 2020 - 2029 |
Base Year For Estimation | 2023 |
Market Size (2024) | USD 13.23 Billion |
Market Size (2029) | USD 16.91 Billion |
CAGR (2024 - 2029) | 5.03 % |
Market Concentration | Medium |
Major Players*Disclaimer: Major Players sorted in no particular order |
Need a report that reflects how COVID-19 has impacted this market and its growth?
Hospitality in Saudi Arabia Market Analysis
The Hospitality Industry In The Kingdom Of Saudi Arabia Market size is estimated at USD 13.23 billion in 2024, and is expected to reach USD 16.91 billion by 2029, growing at a CAGR of 5.03% during the forecast period (2024-2029).
The hospitality industry in Saudi Arabia expanded dramatically in the past few years due to several noteworthy government initiatives to develop the hotel industry and increase the nation's total tourism targets. Saudi Arabia is the travel destination with the fastest growth rate in the world, according to the G20. The UNWTO reports that foreign visitor visits in the Kingdom rose by 125% to pre-pandemic levels last year, attracting around 94 million tourists and outpacing the global tourism industry's rebound.
Saudi Arabia plans to invest over USD 550 billion in new travel destinations in the coming six years, making it the world's largest investor in tourism. It is due to its efforts to grow its tourist and hospitality sectors. Saudi Arabia led the Arab ranks for inbound tourism in the first three quarters of the previous year, with about 20 million tourists visiting the Kingdom. With the recent approval of the legislation, the industry hopes to contribute 10% of GDP in the coming six years and reach the goal of 100 million annual tourist visits. Travel restrictions are lifted, and the door is opened for a flood of tourists into the Kingdom. It is due to the new visa regulations like e-visas and visas-on-arrival for visitors from 49 countries, further fueling the growth of the hospitality industry.
The hospitality sector is set up for faster expansion, and the area is currently at the top of the travel and hospitality world. In Saudi Arabia, Rotana is developing seven hotels, including five brand-new establishments in Riyadh that are now under negotiation. Over the next four years, these buildings will nearly quadruple the number of rooms the company operates in the Kingdom to 6,000.
Hospitality in Saudi Arabia Industry Segmentation
Hospitality falls under the broad umbrella of the service industry, a tertiary sector of the economy. It includes food & beverages, stay, travel, theme parks, hotels, and event planning, amongst others. The Saudi Arabian hospitality industry is segmented by type and segment. By type, the market is segmented into chain hotels & independent hotels. By segment, the market is segmented into service apartments, budget and economy hotels, and mid-scale and upper-mid-scale luxury hotels. The report offers market size and forecasts for the Saudi Arabian Hospitality Market in value (USD) for all the above segments.
By Type | |
Chain Hotels | |
Independent Hotels |
By Segment | |
Service Apartments | |
Budget and Economy Hotels | |
Mid and Upper-Mid Scale Hotels | |
Luxury Hotels |
Hospitality Industry In The Kingdom Of Saudi Arabia Size Summary
The hospitality industry in Saudi Arabia is experiencing significant growth, driven by ambitious government initiatives aimed at boosting the hotel sector and increasing tourism. The Kingdom has emerged as one of the fastest-growing travel destinations globally, with substantial investments planned in new travel destinations. This growth is further supported by the introduction of new visa regulations, such as e-visas and visas-on-arrival, which have opened the doors to a larger influx of tourists. The sector is poised for rapid expansion, with numerous hotel projects underway, including developments by major players like Rotana and Accor. These efforts are part of Saudi Arabia's Vision 2030 strategy, which aims to diversify the economy and increase the contribution of tourism to the national GDP.
The market is characterized by a mix of international and domestically grown hotel chains, with strategic partnerships enhancing the presence of well-established brands. The rise of online travel reservations, driven by tech-savvy travelers and advanced customer-facing technologies, is transforming the booking landscape in the region. High-end and mid-scale hotels are playing a crucial role in this digital shift, particularly in key cities such as Makkah, Medina, and Riyadh. The hospitality industry in Saudi Arabia presents substantial growth opportunities, attracting new investors and fostering collaborations among major players like Al Hokair Group, Dur Hospitality Company, and Marriott International Inc. These developments underscore the Kingdom's commitment to enhancing its tourism infrastructure and achieving its ambitious tourism targets.
Hospitality Industry In The Kingdom Of Saudi Arabia Market Size - Table of Contents
-
1. MARKET DYNAMICS
-
1.1 Market Drivers
-
1.1.1 Increase in the Number of Restaurants and Bars in the Industry
-
1.1.2 Increase in the Number of Tourist Attractions and Activities
-
-
1.2 Market Restraints
-
1.2.1 Inadequate Research and Development, Unpredictability of the Market
-
-
1.3 Market Opportunities
-
1.3.1 Increased Interest in Serviced Apartments and Mid-scale Brands
-
-
1.4 Porter's Five Forces Analysis
-
1.4.1 Bargaining Power of Suppliers
-
1.4.2 Bargaining Power of Buyers/Consumers
-
1.4.3 Threat of New Entrants
-
1.4.4 Threat of Substitute Products
-
1.4.5 Intensity of Competitive Rivalry
-
-
1.5 Impact of COVID-19 on the market
-
1.6 Insights on Revenue Flows from Accommodation and Food and Beverage Sectors
-
1.7 Insights into Leading Cities in Saudi Arabia with Respect to Number of Visitors
-
-
2. MARKET SEGMENTATION
-
2.1 By Type
-
2.1.1 Chain Hotels
-
2.1.2 Independent Hotels
-
-
2.2 By Segment
-
2.2.1 Service Apartments
-
2.2.2 Budget and Economy Hotels
-
2.2.3 Mid and Upper-Mid Scale Hotels
-
2.2.4 Luxury Hotels
-
-
Hospitality Industry In The Kingdom Of Saudi Arabia Market Size FAQs
How big is the Hospitality Industry In The Kingdom Of Saudi Arabia Market?
The Hospitality Industry In The Kingdom Of Saudi Arabia Market size is expected to reach USD 13.23 billion in 2024 and grow at a CAGR of 5.03% to reach USD 16.91 billion by 2029.
What is the current Hospitality Industry In The Kingdom Of Saudi Arabia Market size?
In 2024, the Hospitality Industry In The Kingdom Of Saudi Arabia Market size is expected to reach USD 13.23 billion.