Emerging destinations drive MENA’s hotel pipeline with Nick Witty

The MENA tourism and hospitality industry has witnessed growth at a phenomenal rate in recent years. Government strategies to diversify economies, alongside unprecedented investment in infrastructure and mega projects, have driven that expansion. Across the region, governments are increasingly repositioning tourism as a key pillar for long-term economic growth. Saudi Arabia, Oman and Qatar, notably, are emerging as three of the primary markets for hospitality investment.

Across these markets, tourism development is increasingly linked to broader economic diversification strategies rather than hospitality expansion alone.

Hotel performance across the Middle East moderated in Q1 2026 due to geopolitical uncertainty affecting regional travel sentiment. Pricing, however, remained relatively resilient across all markets.

Saudi Arabia remains the region’s largest hospitality growth market, recording 122 million international and domestic visitors in 2025. The kingdom also has more than 48,000 new hotel rooms in the pipeline.

Oman, meanwhile, saw occupancy rise 14 percent last year to reach 57 percent, alongside average daily rate (ADR) growth of 4.7 percent. Qatar delivered the strongest combined performance of the three markets. Occupancy there rose 3.7 percent to exceed 71 percent and ADR climbed 20 percent to USD 159.

Tourism Investment driving growth

Government-led infrastructure investment, spanning airports, transport networks and mixed-use developments, is directly enabling hospitality growth. Saudi Arabia’s tourism sector contributes approximately 5 percent to GDP, with ambitions of doubling this to 10 percent by 2030. Foreign direct investment (FDI) inflows have grown from USD 7.5 billion in 2017 to USD 35.5 billion in 2025. Major Vision 2030 projects, meanwhile, are significantly expanding the kingdom’s hospitality offering beyond religious tourism. These include Red Sea Global, AMAALA, Diriyah, AlUla, New Murabba and King Salman Park.

In Oman, three- to five-star hotel revenue reached USD 771 million in 2025, representing annual growth of more than 22 percent. Eco-tourism developments, mixed-use waterfront projects, mountain destinations and resort developments continue to support that expansion.

OMRAN and the Ministry of Heritage and Tourism lead the work. Policies such as visa-free access for travelers from more than 100 countries are also helping to boost demand.

In Qatar, travel and tourism accounts for around 8 percent of GDP, with a national target of 12 percent by 2030. The country saw accommodation revenue reach USD 2.3 billion in 2025, up 12 percent on the previous year. Government-led tourism initiatives and Qatar’s designation as GCC Tourism Capital 2026 are expected to further support visitor demand.

Tourism KSA: new supply country-wide

Saudi Arabia’s planned 48,000 new hotel rooms over the next four years will increase current inventory levels of approximately 176,000 by 27 percent. A total of 21,300, notably, are due to open in 2026 alone.
At city level, meanwhile, Riyadh has more than 10,650 rooms across 53 hotels under construction. Elsewhere, Jeddah is home to 29 hotels with nearly 5,480 rooms. Dammam, an emerging destination and real estate hotspot, has four hotels with 813 rooms underway.

Tourism Emerging destinations flourishing

Saudi Arabia’s major mixed-use projects all include hospitality as a core component of Vision 2030. Around 40 hotels, for example, are planned for Diriyah, a 14 sq km mixed-use giga project on the outskirts of Riyadh. The development sits at the UNESCO-listed World Heritage Site of At-Turaif. Bab Samhan, a Luxury Collection Hotel, is already open, while brands such as Capella, Address, Ritz-Carlton, Janu, Armani and Raffles are in the pipeline.

Red Sea Global and AMAALA are targeting 50 luxury resorts by 2030, covering more than 90 islands across the two destinations. AMAALA’s first eight resorts are expected to open in 2026, anchored by the 128-key Equinox Resort. Shebara Resort, for its part, opened in November 2024 as Red Sea Global’s first owned-and-operated resort.

Future openings at AlUla include Hyatt Place AlUla and NUMAJ by Autograph Collection. Both, in turn, form part of the destination’s continued growth as a cultural and heritage tourism hub. Overall, AlUla is targeting 1 million visitors by 2030.

At New Murabba, the 15 sq km mixed-use project in Riyadh, planned hospitality includes the Mondrian Riyadh Al Malga. The 200-key property combines 130 rooms and suites with 70 branded residences. It is scheduled to open in 2028, part of a future 9,000-room offering across the wider project.

Riyadh’s 17 sq km King Salman Park announced USD 3.8 billion in new investment commitments earlier in 2026. The development will incorporate hotels, branded residences, a performing arts center and two golf courses.

Tourism Mega events shaping demand

Saudi Arabia’s mega events include Riyadh Expo 2030 and the FIFA World Cup 2034. Both should generate significant demand across the tourism and hospitality sector.

Hotel occupancy rates, particularly in upper-tier and luxury categories, are expected to surge during these events. That surge should help reposition Saudi Arabia from a predominantly religious tourism market into a broader, world-class leisure, sports and entertainment destination.

The Expo site is expected to welcome more than 42 million visitors, driving hotel development across all star ratings. Mid-market properties and serviced apartments, in particular, will be of relevance. With
15 stadiums across five cities, the FIFA World Cup’s multi-city format will distribute demand nationally rather than concentrating it in one location. The format will therefore require accommodation product at scale across all price points.

Equally, the AFC Asian Cup 2027 should sustain demand momentum between the current events cycle and the longer-term macro events. Annual events, meanwhile, continue to support hotel demand from October through to April. These include Riyadh Season, the F1 Grand Prix in Jeddah, the Saudi Cup, Formula E and Diriyah Season.

Tourism Oman’s year-round appeal

Government support for tourism in Oman is substantial. It includes USD 260 million in usufruct agreements from the Ministry of Heritage and Tourism. OMRAN has committed USD 31 billion through to 2040, alongside USD 114 million in eco-tourism infrastructure contracts across seven nature reserves. Events such as the Khareef Festival, Muscat Festival, Tour of Oman and the Within Oman Campaign help position Oman as a year-round destination. Moreover, they diversify demand beyond Muscat into secondary locations including Salalah and Musandam.

Consequently, Oman is set to deliver 3,320 rooms across 17 projects in 2026 and 2027. Notably, the bulk of this supply, nearly 2,390 rooms across 14 projects, is expected in 2026. Key luxury projects include Nobu Resort Yiti, Anantara Bandar Al Khairan near Muscat, Four Seasons Muscat and the Jabal Akhdar Mountain Destination eco-tourism development. In addition, Club Med Musandam, the Middle East’s first Club Med resort, is targeted for 2028. Port Sultan Qaboos Waterfront, a mixed-use redevelopment, brings together VA Group and OMRAN.

Tourism Qatar’s growing pipeline

Qatar’s current hotel supply stands at approximately 42,500 keys, with around 1,970 rooms across 15 projects in the 2026 pipeline. For the most part, these are concentrated in Doha and Lusail. Beyond this, the wider pipeline is more than 3,560 rooms across 22 projects through to 2030. Luxury properties including Rosewood Doha and Andaz Doha opened in 2025, while Corinthia Doha on Gewan Island is due to open in 2027.

The USD 5.5 billion Simaisma Coastal Destination represents one of the most significant near-term demand-and-supply catalysts for the tourism sector. Doha’s GCC Tourism Capital status is another. Events such as Art Basel Qatar, Web Summit Qatar, F1 Grand Prix, FIFA Arab Cup, FIFA U-17 World Cup, FIBA Basketball World Cup 2027 and the 2030 Asian Games are helping to support consistent, year-round hotel demand. Qatar Airways’ continued network expansion and the Qatar Stopover program add incremental room nights. Both enable short-stay visits as part of longer journeys through Hamad International Airport.