The Q3 2024 Middle East Hotel Construction Pipeline Trend Report by Lodging Econometrics (LE) reveals a positive trend in hotel construction in the region, with the pipeline comprising 610 projects and 149,686 rooms—an increase of 4% in projects and 7% in rooms compared to the previous year.
As of the end of the third quarter, there are 296 projects under construction, representing 79,978 rooms or 49% of the total pipeline. The number of projects expected to commence construction within the next year has surged significantly, rising by 36% in projects and 51% in rooms year-over-year, totaling 140 projects and 36,260 rooms. Additionally, early planning projects reached 174, corresponding to 33,448 rooms, reflecting a 7% increase in projects and a 5% increase in rooms compared to last year. Brand conversions are also thriving, marking a new high with 47 projects and 10,390 rooms, which is up 31% and 37% by rooms, respectively, year-over-year.
Luxury, upper-upscale, and upscale hotel chains dominate the region’s pipeline, comprising 78% of the total with 477 projects and 119,063 rooms. The luxury sector, in particular, experienced significant growth in Q3, achieving a record high of 173 projects and 40,113 rooms—up 7% in projects and 21% in rooms compared to the prior year.
Saudi Arabia leads the region in the number of projects in the construction pipeline, with a 15% increase in projects and an 18% uptick in rooms year-over-year, totaling 317 projects and a record 79,984 rooms. Egypt follows with 109 projects and 26,286 rooms, also reaching record levels, reflecting a 20% growth in projects and a 21% increase in rooms year-over-year. The United Arab Emirates (UAE) ranks third with 86 projects and 23,743 rooms, although it experienced declines of 20% in projects and 13% in rooms year-over-year.
Riyadh stands out as the city with the highest number of construction projects, totaling 90 projects and 18,067 rooms. Jeddah follows with 53 projects and 11,336 rooms, while Cairo has 40 projects and 8,905 rooms, showcasing impressive year-over-year growth of 21% in projects and 16% in rooms.
By the end of Q3 2024, the Middle East saw the opening of 51 new hotels, totaling 9,356 rooms, with 14 new hotels and 2,504 rooms debuting in Q3 alone. LE forecasts an additional 35 new hotels and 6,916 rooms to open in Q4 2024. Looking ahead, 107 new hotels with 27,485 rooms are projected to open in 2025, followed by 121 new hotels and 25,030 rooms anticipated for 2026.
This article first appeared on hotelbusiness.com under the title “LE: Middle East Q3 pipeline up 4%.”
