"In a very short span, we have been able to capture a significant segment of the market," said General Manager Magdy El Badry.

"A large part of our attraction is the brand name. People associate Sofitel with luxury, and that is what we provide to our guests at our hotel," he said. "The other significant reason for our growing popularity is our prime beachfront location."

The 229-room, five-star hotel overlooks the Arabian Gulf from the city's corniche, making it attractive both for beach going tourists from Riyadh and local businesses looking for conference facilities.

"It is not just leisure travelers who are patronizing us. In the months since we have opened up, we have big corporate houses that have been holding meetings and events in our grand banquet halls," said Mohamed Zahran, assistant director of sales and distribution. "In the months to come, we plan to come up with more guest friendly packages."

Nine quality hotels now serve Alkhobar and must vie for hostel and banquet business.

"Competition is good for both the market and the people," El Badry said. "We have a distinct advantage because of the international popularity of the Sofitel brand."

The new hotel meets European standards with a distinctly French ambience. The Alkhobar property is part of the group's expansion into the Middle East and Asia. After eliminating 50 properties in 2008 because of consistency problems, the chain now operates more than 150 hotels worldwide.

Business is booming throughout the region. At the time of the hotel's launch in October, Eastern Province Gov. Prince Mohammad bin Fahd described it a positive indicator for the Saudi economy.

"By the grace of God and thanks to the generous support of our government, we are witnessing phenomenal growth, and now is the time to come up with many such projects," the prince said. "It goes without saying the importance that the Eastern Province holds as the Kingdom's economic, commercial and industrial center."

The governor has repeatedly underlined the need for more such hotels and furnished apartments in the region because more and more people from other parts of Saudi Arabia are visiting the Eastern Province.