Makkah hotels bounce back with price cuts

Known to have the highest prices through the year, hotel rooms near the Grand Mosque currently cost between SR250 and SR700. (AFP)
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Updated 07 October 2020

Makkah hotels bounce back with price cuts

  • Competitiveness in the sector ‘likely to return by 2023’

MAKKAH: Makkah hotel prices have been slashed to unprecedented levels in the Umrah season, with the price of rooms dropping as low as SR38 ($10) in some areas.

Five-star hotels with a full view of the Grand Mosque in Makkah are getting ready to resume their activity and restore normality to the hotel industry by offering great discounts.

The holy city contains more than 1,400 hotels, which make up more than two third of the accommodation sector in the whole of Saudi Arabia.

Known to have the highest prices through the year, which peak about three times during busy seasons, hotel rooms near the Grand Mosque currently cost between SR250 and SR700 ($77-$187).

A tweet by Hajj and Umrah Minister Dr. Mohammed Saleh Benten, brought attention to central Makkah hotels that have endured through the testing times of the pandemic.

Benten expressed his gratitude and happiness for the striking offers made by Makkah hotels, and described them as safe environments that take health requirements into account.

Abdullah Filali, chairman of the hotel committee at the Makkah Chamber of Commerce and Industry, told Arab News that the promotions announced by some hotels are a gradual means to revitalize the sector. He said the pricing is just the beginning of a gradual, progressive return to health for the troubled industry.

Filali noted that prices do not reflect employment volume, which fell to the low levels after the pandemic hit. “All hotels had to resort to the state aid ‘SANED,’ to keep their employees and fix their documents,” he said.

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The price of rooms has dropped as low as SR38 in some areas.

He added that only four central hotels had started to come back to life and that the recovery of the accommodation sector will be well underway by October 2021. Competitiveness will return by the end of 2023, Filali said.

The manager of one hotel overlooking central Makkah, Fadel Munqal, said that state efforts to serve Muslims are clear and evident through the protection of pilgrim safety. Steps to resume Umrah were compliant with health and precautionary plans and ensure the protection of health and safety, he added.

“The Kingdom seeks to reach the highest levels of reassurance and readiness for all pilgrims of different nationalities, which will be achieved with the beginning of the third phase of the plan. It will indicate the actual comeback of the accommodation sector and enable pilgrims to experience an integrated spiritual and tourism experience,” Munqal said.

He added that the Kingdom sacrificed economic welfare in a noble move to protect pilgrim safety during Hajj and Umrah.

Munqal said that Saudi Arabia possesses the capabilities to help hotels compete — in compliance with precautionary measures — with the arrival of pilgrims from across the world. He added that Makkah provides Islamic sites, in addition to important historical museums.

Grand Mosque library

The library of Makkah’s Grand Mosque has launched more than 16 initiatives to start welcoming visitors. The library will receive 30 visitors per hour amid strict social distancing measures.

It is considered a beacon of knowledge, covering an area of 1,000 square meters and containing 30,000 books and 5,600 titles.


Saudi investors share expertise on Saudi corporate VC opportunities

Updated 27 November 2020

Saudi investors share expertise on Saudi corporate VC opportunities

JEDDAH: The two-day Step Saudi 2020 event featured two prominent Saudi figures in the field of investment on the second day.
Hashim Al-Awadi, CEO of Tech Invest, and Salman Jaffery, chief investment officer at Saudi Aramco Entrepreneurship Ventures, both shared their expertise, with the latter saying it is more beneficial for corporations to start a venture capital (VC) arm than invest from their current mergers and acquisitions arm (M&A).
Managing partner at Class 5 Global, Zach Finkelstein, who moderated the session on the second day of the event, said the San Francisco-based venture fund invested in a number of companies in the Middle East.
“The Middle East is particularly interesting to us, and in the past, our partners have invested in such regional companies as Careem. We’re excited to explore the development of the corporate VC space and how it can impact places like Saudi Arabia,” he added.
When asked why a corporation should start a VC arm instead of investing from an M&A team, and why have a separate corporate Venture Capital arm in the first place, Jaffery answered that “it brings faster results.”
“I think the easiest answer to that is just speed and agility,” he said. “Getting that response quickly to the market. VC deals can take weeks or months whereas an M&A transaction can take up to a year or longer, and also similarly, if you’re trying to then come out of it, it’s harder to come out of a joint venture agreement or an M&A as opposed to a VC.”
Al-Awadi explained his opinion a traditional VC perspective, and said: “We like the fact that corporations can invest from both their M&A arms and their VC arms if they have them.”
He highlighted that VC arms can invest in a greater variety of companies. “You have the intelligence, you know the market and if you’re looking at specific technology where we don’t have a lot of expertise we trust that you (other venture capitalists) know the market and you can evaluate that technology better to see if it has the capability and potential for growth or not.
“Eventually, you do have an M&A arm that will provide an exit for us, for an incentive for this company to work hard to grasp the intention after having been invested in by the VC arm of this big corporate to maybe look into making a partial agreement or complete acquisition, which really adds an incentive for the company to grow and attracts other investors and also attracts talent to join the company and help it grow even more.”
He said both the VC and M&A arm are important for company growth. “We tend to look at corporate investors through both arms as complementary to what we do when we have both of them around.”
The Kingdom has obtained a high reputation among investors internationally through the years, especially after the economic and social reforms of Saudi Vision 2030.
Step Saudi is home to the Kingdom’s best entrepreneurs, investors, creatives and digital enthusiasts. The last edition of Step Saudi featured four content tracks, more than 100 startups and over 1,500 attendees.