The Saudi Arabia, Middle East and Africa (MEA) region is experiencing continued growth in its hospitality development pipeline. As of April 2025, 104,572 hotel rooms are under construction, with an additional 50,683 expected to open in 2025.
Saudi Arabia is the dominant force behind this expansion, with 42,800 hotel rooms under contract as of April 2025. The country’s giga projects and large-scale tourism initiatives under Vision 2030 largely drive this growth. The latest data from CoStar highlights Saudi Arabia’s position as the regional leader in hotel room developments.
Along With Saudi Arabia, Dubai and Qatar Also Contribute to Growth
Despite a wave of new hotel openings in recent years — particularly in Dubai ahead of Expo 2020 and in Qatar before the 2022 FIFA World Cup — the number of rooms under contract in the MEA region continues to grow steadily. This growth is a reflection of the increasing demand for hotel accommodations across the region, according to Kostas Nikolaidis, Senior Account Manager at STR.
“The continued expansion of the under contract pipeline is encouraging,” Nikolaidis said. “It shows rising demand for hotel rooms across various markets. Demand for hotel rooms continues to grow at a steady pace of +1.9 percent in March YTD.” This momentum indicates that investments in the hospitality sector are continuing to increase.
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Saudi Arabia Year-on-Year Growth
In April 2025, Saudi Arabia’s hotel development pipeline saw a year-on-year increase of 6,817 rooms. The total number of rooms under contract stands at 42,800, signalling robust growth. The Kingdom is driving the expansion through its ongoing mega-projects and strategic investments aimed at transforming Saudi Arabia into a global tourism hub under Vision 2030.
The Saudi Arabia Regional submarket recorded the largest increase in rooms under construction, with 11,450 rooms in April 2025 compared to 9,716 in the same period last year. This is a clear indication that Saudi Arabia’s giga projects are advancing and expanding across different stages of the development pipeline.
MEA Region’s Development Pipeline Overview
Saudi Arabia, the UAE, Qatar, and Egypt are driving the growth in the MEA region’s hotel development pipeline. According to CoStar, 50,683 hotel rooms are expected to open across the region in 2025. While the number of rooms in final planning decreased by 21.8 percent to 28,875, those in the planning phase increased by 17.1 percent to 94,056. This indicates sustained long-term confidence in the hospitality sector.
The holy cities of Makkah and Medina are major contributors to Saudi Arabia’s hotel room development. As of April 2025, there are 17,646 rooms under construction in Makkah and 20,079 rooms in Medina, reflecting substantial progress in the development of these religious and tourism hotspots.
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Dubai and Other UAE Cities Contribute to Regional Growth
While Saudi Arabia leads the region, Dubai and other UAE cities are also significant players in hospitality development. Dubai is expected to add 5,344 hotel rooms in 2025. Additionally, Riyadh and Jeddah will contribute 3,485 and 3,156 hotel rooms, respectively.
Despite facing global economic challenges, hotel development in the MEA region remains strong, driven by high investor and operator confidence. Governments across the region continue to prioritize tourism as a key economic pillar. This is supported by significant infrastructure investments, favorable policies, and ambitious national diversification strategies.
Long-Term Investment MEA Hospitality Sector
With Saudi Arabia taking the lead, the MEA hospitality sector is poised for continued expansion. This growth is backed by long-term capital commitments and a strong development pipeline. The region’s governments remain focused on strengthening the tourism industry, making it a key economic driver for the years to come.
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