In May, Jeddah hotels witnessed a remarkable surge in occupancy, reaching nearly 80% – the highest monthly rate recorded since 2016. This surge can be attributed to Saudi Arabia’s relentless efforts to establish itself as a regional business and trading hub. The Arab League Summit, held in Jeddah on May 19, played a significant role in driving hotel bookings during this period, as reported by global data benchmarking firm STR.
According to STR’s data, Jeddah, the Kingdom’s second-largest city, achieved its highest occupancy level on May 17, peaking at an impressive 90.6%. Moreover, on May 18, the night before the Arab League Summit, the average room rate reached its zenith at SR1,440.69 ($384.14).
The port city experienced a substantial increase of 21.9% in its occupancy rate compared to the same month last year. The average daily rate stood at SR924.32, while the revenue per available room reached SR738.80. Despite lower room rates than the previous month, Jeddah’s revenue per available room (RevPAR) was the highest since September 2019, according to the STR report.
The hospitality sector in Saudi Arabia, like many others around the world, bore the brunt of the global pandemic. In 2020, hotel occupancy rates plummeted, with Riyadh witnessing a decline from 60% in 2019 to 49% in the following year. Similarly, Makkah’s occupancy rate dropped from 61% to 25%, and Jeddah experienced a decline from 58% to 37% during the same period, according to professional services firm Deloitte.
However, the pace of recovery in the hospitality sector gained momentum as Saudi Arabia focused on tourism as a vital component of its post-COVID-19 recovery plan. As part of its Vision 2030 pledge, the Kingdom aims to attract 100 million annual visitors within seven years, further emphasizing its commitment to the tourism industry’s growth.
During the World Travel and Tourism Council Global Summit in Riyadh last November, Saudi Minister of Tourism Ahmed Al-Khateeb revealed that the Kingdom is offering investment opportunities worth $6 trillion in the travel and tourism sector through 2030. This ambitious initiative underscores the Saudi government’s dedication to developing the tourism industry and positioning the country as a global tourism destination.
The recent surge in hotel occupancy rates in Jeddah signifies a significant milestone in the recovery of the hospitality sector in Saudi Arabia. As travel restrictions ease and the tourism industry continues to rebound, the Kingdom’s efforts to diversify its economy and attract international visitors are evidently paying off. With ongoing investments and a strong focus on tourism, Saudi Arabia is well-positioned to achieve its ambitious tourism goals and establish itself as a premier destination for travelers from around the world.
