RIYADH: The Red Sea Development Co., the developer of one of the world’s largest sustainable tourism sites, has secured all necessary funds for the first phase of the project and it’s now accelerating work on the project, its chief financial officer said.
The company, known as TRSDC, which until now was focusing on execution and delivery of three hotels, has shifted gears and turned its attention toward operations. It has already hired the first general manager of one of the three hotels and is identifying top executives for the other two hotels, Jay Rosen told Arab News.
“We are at the starting point of the pre-opening process as we ramp up our operations over the next 12 months,” said the executive while adding that they remain on schedule to welcome first guests by next year.
It has secured all the needed equity from the Public Investment Fund to partner with nine international hospitality brands that will operate resorts in the first phase of development at the Red Sea project.
“We made some additional signings. We haven’t announced those yet. And there are others we’re completing as well,” said Rosen. The company last year roped in marquee brands such as Marriott International, Fairmont Hotel & Resorts, Accor group, Hyatt Hotels, IHG Hotels & Resorts, and Jumeirah Hotels & Resorts.
The project is a 28,000-square-kilometer sustainable tourism resort featuring more than 90 unspoiled islands along Saudi Arabia’s west coast. By completion in 2030, it will consist of 50 hotels with 8,000 rooms and 1,300 residential properties.
Using equity and green finance
TRSDC have seen a lot of interest from Saudi banks to provide green financing for its development. Rosen said the company is considering to rely on both equity and debt as well for its other development AMAALA, an ultra-luxury site north of TRSDC's main project.
True to its commitment to creating opportunities for the locals in the transformative Vision 2030 blueprint, the company is exploring avenues for Saudi citizens and investors to invest in the advanced stages of the project execution.
"At some point in time, we will make opportunities available for the retail investors", he said, adding that they are keeping all options open. They can come in many forms, either through REITs, a fund or through a public offering of some business units, said the executive.
The company early last year received a $3.76 billion loan to fund phase one of the project from Saudi National Bank, Riyad Bank, Banque Saudi Fransi, and Saudi British Bank.
Last month, A consortium led by ACWA Power closed the financing for a $1.59-billion power project to generate clean energy for the destination.
ACWA Power-led consortium secured financing to design, build, & operate #TheRedSea's utilities infrastructure. This confirms our development as the largest tourism project powered solely by 100% renewable energy & shows the world that tourism development can be done sustainably. https://t.co/WidHalSrsy
— The Red Sea Development Company (@TheRedSeaGlobal) March 2, 2022
World's largest battery storage system
As the world gets serious about fighting climate change, Saudi Arabia's TRSDC is leading the pack with increasing emphasis on renewable energy and inclusive growth.
The energy requirements for the development will be generated on a sustainable, fully dispatchable basis by a 340MW solar photovoltaic plant with an associated storage system utilising a battery energy storage system plant for captive use, which at a design capacity of around 1.200 GWh will, upon deployment, be one of the world’s largest utility-scale BESS systems.
Acwa Power and its partners will design, build, operate and transfer a 100 percent renewable energy infrastructure to ensure sustainable power generation, water production, wastewater treatment, and district cooling.
Fresh from its recent ISO14001:2015 accreditation, the company is partnering with the best minds in business and finance to build the world's largest sustainable tourism project and encourage the ethos of responsible tourism.
"While there may be a cost associated with sustainability, we believe it is a great value add because it preserves and protects our environment. We think that's what luxury guests and travelers want these days. They want to travel to responsible and sustainable destinations," said TRSDC's Rosen.
"When people generally talk about sustainability, they mean using renewable energy during the day and switching to fossil fuel at night. When we talk about 100 percent renewable energy, we truly mean it's 24 hours a day and 365 days a year," said the executive.
TRSDC is going to be one of the main projects supporting Saudi Green Initiative, which aims at planting billions of trees to fight climate change.
The developer of the world's largest sustainable tourism sites is planning to create artificial wetlands to further improve the environment as the company is advancing construction work.
It will create 38 hectares of artificial wetlands which are expected to attract birds and bats to feed on the many insects and invertebrates that colonize the wetlands, Damian Smith, a senior manager in the project's environmental team told Arab News in February.