Rotana announces plans to support Saudi Vision 2030 and boost the Kingdom’s diversification push

Rotana, one of the leading hotel management companies in the Middle East, Africa, South Asia and Eastern Europe, will open four new hotels in the Kingdom of Saudi Arabia (KSA) in 2017 as it continues to look to markets in the GCC to drive business growth and expansion, the company’s Chief Operating Officer Guy Hutchinson said in Jeddah on the sidelines of the Rotana Hotels 2017 GCC Roadshow.

All four of the upcoming Rotana properties in the Kingdom will be under the company’s lifestyle affordable hotel brand “Centro by Rotana”. Firstly Centro Waha, Riyadh – will open in the second quarter of this year and Centro Salama, Jeddah – will open in the third quarter of this year, while the remaining two properties – Centro Olaya, Riyadh and Centro Corniche, Al Khobar – are set for a Q4 2017 opening. The projects represent a total investment of USD 130 million.

The new openings will add 888 keys to Rotana’s existing supply of 969 rooms in KSA, taking its total inventory in the country to more than 1,850 rooms.

“Saudi Arabia is pivotal to Rotana’s expansion strategy for the region,” Guy Hutchinson said. “Despite the knock-on effects of the oil price slide and the prevailing tough global economic environment on tourism spending, Saudi Arabia’s tourism and hospitality sector has shown remarkable resilience, thanks to the nation’s determined push towards economic diversification. The Saudi government recognises the crucial role that tourism can play in driving the country’s economy away from oil dependency and achieving sustainable and inclusive growth, and is doing everything in its capacity to support the creation of a world-class tourism infrastructure to set the ground for future growth.”

He added, “Widening the accommodation choices for visitors by bringing more mid-market offerings to the market is vital to keeping Saudi Arabia on the fast track towards achieving its tourism goals. There is today an urgent need for more budget-friendly hotels in the Kingdom as travellers look for affordable accommodation that doesn’t compromise on comfort and convenience. Rotana is responding to these demands by bringing to KSA an impressive collection of properties under our ‘Centro’ brand, which has redefined the rules of the mid-market game by combining world-class service and comfort in an affordable package.”

In addition to being one of the Middle East’s fastest-growing inbound tourism markets, Saudi Arabia is also a key driver of travel demand for Rotana hotels across the region. In 2016, the company registered a phenomenal 22 percent increase year-on-year in Saudi room nights while revenue from Saudi guests witnessed an 8.7% jump.

“Saudi Arabia is the second largest feeder market for Rotana hotels in the region after Great Britain. We remain very optimistic on the Kingdom’s tourism sector and we expect occupancy rates at our hotels in 2017 to be in line with last year’s numbers,” Hutchinson said. “Rotana recognises the catalytic potential of hospitality and tourism in helping Saudi Arabia usher in an era of diversified economic growth, and we are committed to supporting and contributing to the goals outlined in the Saudi Vision 2030 roadmap.”

Commenting on the trends that will drive tourism and hospitality growth in KSA and the region in 2017, Hutchinson said, “Intra-regional travellers from the GCC – and in particular Saudi Arabia – remain the dominant source market for Rotana and the industry as a whole, and this trend will likely gather more pace in the coming months. Technology advances will continue to transform the way the hospitality industry functions, with the use of mobile apps becoming more ubiquitous, and dynamic pricing strategies will keep gaining in popularity. Although we expect some of the economic and geopolitical challenges of last year to spill over into 2017, overall, we feel the increase in supply will make the market more competitive in 2017, leading hospitality players to focus on innovation and resource optimisation while creating enhanced value for guests.”

According to STR’s Middle East/Africa November 2016 hotel pipeline, Saudi Arabia accounts for the most number of hotel rooms currently under construction in the region – with 37,864 rooms taking shape and form across 83 hotels in the Kingdom – ahead of the UAE.