World’s largest hotel operator sees growth in Saudi market

World’s largest hotel operator sees growth in Saudi market
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Wyndham Hotels and Resorts (WHR) has 43 hotels across the Kingdom, UAE, Qatar, Oman, Bahrain and Kuwait, with another 11 hotels and approximately 2,500 rooms in the development pipeline. (Photo/Supplied)
World’s largest hotel operator sees growth in Saudi market
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Wyndham Hotels and Resorts (WHR) has 43 hotels across the Kingdom, UAE, Qatar, Oman, Bahrain and Kuwait, with another 11 hotels and approximately 2,500 rooms in the development pipeline. (Photo/Supplied)
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Updated 01 May 2021

World’s largest hotel operator sees growth in Saudi market

World’s largest hotel operator sees growth in Saudi market
  • Saudi Arabia has the world’s biggest hotel room pipeline, set to grow 67% over the next 3 years

JEDDAH: The hospitality sector has been hit hard by the pandemic. In Saudi Arabia, international flights have been suspended since March 2020. Hajj and Umrah seasons, which are essential drivers of the market, were canceled, meaning that the industry has lost millions of domestic and international pilgrims over the past year.

However, with the region getting ready to return to traveling, a vigorous recovery is expected within the coming 12 months. 

“I believe that it’s going to be a good year, 12 months at least, before we start seeing things to come back into full force,” Dimitris Manikis, president and managing director Europe for the Middle East, and Africa (EMEA) at Wyndham Hotels and Resorts (WHR), told Arab News.

The EMEA president of the largest hotel franchisor in the world stressed that the desire to travel has only intensified during the pandemic, especially with the vaccines becoming more widely distributed and governments increasing interest in health passports to facilitate safe travel.

However, the extent to which those policies will have an immediate positive impact in boosting the sector’s recovery will only be revealed in the next few months, according to Manikis.

But Manikis said: “We are seeing the recovery in certain markets already. For example, in the UAE, we see hotels with 65 to 85 percent occupancy, and rave parties are coming back.”

WHR has 43 hotels across the Kingdom, UAE, Qatar, Oman, Bahrain and Kuwait, with another 11 hotels and approximately 2,500 rooms in the development pipeline.

In Saudi Arabia, WHR currently boasts 13 hotels hosting over 1,800 rooms, with the biggest representation being their most popular brand, the Ramada by Wyndham. 

Moreover, WHR is expected to open one new Ramada hotel in Riyadh and two in Alkhobar city in 2021 and 2022.

“Saudi Arabia is such an important market for not just Wyndham but the whole region and for every single brand that has a presence in the country,” said Manikis.

FASTFACTS

• In Saudi Arabia, Wyndham Hotels and Resorts currently boasts 13 hotels hosting over 1,800 rooms.

• It is expected to open one new Ramada hotel in Riyadh and two in Alkhobar city in 2021 and 2022.

• About 25 percent of WHR’s pipeline is within Saudi Arabia.

The most vibrant area for the Saudi hotel market has been the holy cities — Makkah and Madinah — with religious travel acting as the main promoter for investments in the hospitality industry in the Kingdom for many decades. But Manikis is looking ahead to future opportunities that the newly introduced tourism projects may offer to the sector.

“There are some amazing projects coming up. I think that gives an enormous opportunity for us and other brands to showcase our ability to be part of the new hospitality plan that the Kingdom has,” he said.

In recent years, Saudi Arabia had been focusing on improving investment opportunities in the hospitality sector through the introduction of several projects, such as Qiddiya, the Red Sea Project, Amaala, NEOM, AlUla and the Wadi Al-Disah Development. These major projects were launched by the Public Investment Fund to fulfill the tourism target in the Vision 2030 reform plans.

Manikis described Saudi society as vibrant with a growing middle class, making the country’s market a seedbed for a balanced, diverse mix from luxury to budget hotels. 

According to Manikis, Saudi consumers travel in big families, stay longer, and like to have certain amenities and facilities when they travel. However, in light of the changing scene of tourism in the Kingdom, he said: “It will be interesting to watch” the changes in market performance and consumer behaviors.

Regionally, about 25 percent of WHR’s pipeline is within Saudi Arabia. The chain’s Ramada has been a strong brand in the Kingdom since the company entered the Saudi market in 2004.

Manikis anticipates a potential increase in demand for economy brands, but insists that the ranges will fluctuate in the Saudi market.

Earlier this month, a report found that Saudi Arabia has the world’s biggest hotel pipeline, anticipating a 67.1 percent increase in room supply over the next three years, the highest among the 50 most populated countries. The data showed 73,057 rooms in the Saudi hotel pipeline, with 16,965 scheduled to come online in 2021. 

As the industry is looking forward to a successful recovery, the pandemic has pushed market players to rethink how services and experiences are provided to their guests.

Manikis highlighted that consumers now expect to experience a digital transformation in hotels. At the same time, a new segment of products such as extended stays and serviced apartments will start to grow. 

Moreover, how people interact with each other and public spaces will also be discovered in the coming months, he said. 

Manikis said that we may see bigger lobbies and rooms, less furniture and fewer accessories in hotel rooms, and new alternatives to food buffets.

But more changes will be discovered in the third and fourth quarter of this year when people return to traveling.


Saudi financial liquidity rises to record at end of April

Saudi financial liquidity rises to record at end of April
Updated 07 May 2021

Saudi financial liquidity rises to record at end of April

Saudi financial liquidity rises to record at end of April
  • Money supply increased 1 percent in the week to SR2.199 trillion

RIYADH: Saudi liquidity reached its highest level ever at the end of last week, April 29th, at SR2.199 trillion ($586.2 billion), compared with SR2.177 trillion a week earlier.

Money supply increased by 1 percent during the week, and 2.3 percent since the end of last year, Al Eqtisadiah reported, citing Saudi Arabian Monetary Authority data.

Money supply has been above SR2 trillion since May 7, 2020.


Saudi insurance sector grew 2.3 percent in 2020 amid pandemic

Saudi insurance sector grew 2.3 percent in 2020 amid pandemic
Updated 07 May 2021

Saudi insurance sector grew 2.3 percent in 2020 amid pandemic

Saudi insurance sector grew 2.3 percent in 2020 amid pandemic
  • Written premiums rose to SR38.78 billion
  • Net profit increased 61.1 percent

RIYADH: The Saudi insurance sector grew 2.3 percent in terms of written premiums in 2020, to SR38.78 billion ($10.3 billion), according to the Saudi Arabian Monetary Authority’s (SAMA) 14th annual report on the Saudi insurance market, issued on Thursday.

Energy and accident & liability insurance classes showed notable increases in written premiums with penetration of the sector increasing from 1.3 percent in 2019 to 1.5 percent in 2020.

In terms of underwriting performance, the overall loss ratio improved to 77.5 percent.

Insurance net profit (after zakat and tax) increased by 61.1 percent compared to the previous year’s corresponding figure, thereby improving the return-on-assets and return-on-equity ratios.

The SAMA report also noted that the overall Saudization ratio increased from 74 percent in 2019 to 75 percent in 2020.


Qatar Minister of Finance replaced after arrest

Qatar Minister of Finance replaced after arrest
Updated 07 May 2021

Qatar Minister of Finance replaced after arrest

Qatar Minister of Finance replaced after arrest
  • Al-Emadi replaced by Minister of Trade and Industry
  • Al-Emadi accused of embezzlement, abuse of power

RIYADH: Qatar’s Emir has replaced the Minister of Finance following his arrest, according to a Royal statement on Thursday.

“Ali Sharif Al-Emadi, Minister of Finance, is relieved of his position, and Ali bin Ahmed Al Kuwari, Minister of Trade and Industry, in addition to his duties, is to be entrusted with the duties of the Minister of Finance,” Qatar News Agency (QNA) reported citing the Amiri order.

The public prosecutor said earlier Emadi was being questioned over allegations of embezzlement, abuse of power and crimes related to the public sector, according to a statement carried by the official state news agency. An investigation is underway.


Saudi cement companies post $237.9m net profit in Q1 2021

Saudi cement companies post $237.9m net profit in Q1 2021
Updated 07 May 2021

Saudi cement companies post $237.9m net profit in Q1 2021

Saudi cement companies post $237.9m net profit in Q1 2021
  • Net profits were 15 percent lower than a year ago
  • Four companies saw record profit growth while 10 experienced a decline

RIYADH: Saudi cement companies listed in the main market during the first quarter of this year 2021 achieved net profits of SR892.5 million ($237.9 million), compared to about SR1.05 billion for the same period last year, recording about 15 percent decline.

Four companies recorded record growth, while the remaining 10 saw a decline, Al Eqtisadiah reported citing Saudi financial market data.

Najran Cement recorded the highest growth in net profit with 51.4 percent, while Arabian Cement Co. achieved 48.6 percent growth, followed by Al Jouf Cement, up 15.4 percent.

Tabuk Cement posted the biggest decline in net profit, decreasing by 75.6 percent to SR7.1 million.

Cement companies’ revenues decreased 1.5 percent during the first quarter of this year to SR2.94 billion, compared to about SR2.98 billion for the same period in 2020. Revenues grew by 2 percent compared with the previous quarter.


King Fahd Causeway reopening to give Bahrain $2.9bn tourism boost

King Fahd Causeway reopening to give Bahrain $2.9bn tourism boost
Updated 07 May 2021

King Fahd Causeway reopening to give Bahrain $2.9bn tourism boost

King Fahd Causeway reopening to give Bahrain $2.9bn tourism boost
  • Saudis make up 88 percent of Bahrain's visitors
  • Bahrain attracted 9 million tourists in 2019

RIYADH: The reopening of the King Fahd Causeway, which connects Bahrain to Saudi Arabia, will add up to $2.9 billion to Bahrain’s economy this year, based on average tourism spending in 2019, according to the Bahrain Chamber of Commerce and Industry.

Saudi Arabia has said it will reopen land, sea and air border crossings on May 17th.

Bahrain attracted nearly 11 million visitors in 2019, of which 9 million were tourists. Saudis account for 88 percent of Bahrain’s visitors, the majority of whom come via the causeway.

Although trade between Bahrain and Saudi Arabia has continued throughout the Covid-19 pandemic, tourism has been severely affected, Asharrq reported citing Ali Al-Midfa, executive director of investments at the Economic Development Board.

“Bahrain offers promising opportunities in multiple tourism sectors that can benefit from the Kingdom’s proximity to Saudi Arabia, as well as opportunities in the real estate and investment sectors, which are expected to recover with the opening of the bridge,” he said.

Bahrain Customs installed artificial intelligence scanners on the bridge, and worked to automate the data collection process and allow cargo inspections before reaching the ports, said the First Vice President of the Bahrain Chamber of Commerce and Industry Khaled Mohamed Najibi.