Saudi Arabia’s hospitality market experienced softer performance in the first half of 2026 amidst weaker corporate travel demand and ongoing regional uncertainty. However, the sector’s long-term outlook remains positive, supported by rising domestic tourism expenditure, growing international visitation targets and substantial hotel development activity, according to global real estate advisor CBRE.
The kingdom’s total hotel room inventory reached approximately 177,000 keys at the end of Q2, with significant new supply planned across Riyadh, Jeddah, Makkah, Madinah and the Red Sea coast.
Several major hospitality developments linked to Saudi Vision 2030 continue to progress through construction and delivery phases, it stated.
Presenting a positive outlook, Matthew Green, Head of Research at CBRE Mena, said: "What is increasingly evident across Saudi Arabia is the scale of execution taking place on the ground. From major infrastructure projects and commercial developments to new residential communities and tourism destinations, investment is increasingly translating into delivery."
"Supported by a growing non-oil economy and progressive regulatory reforms, including the introduction of the new non-Saudi property ownership framework," he stated.
According to Green, Saudi Arabia continues to strengthen its position as one of the most compelling real estate investment destinations globally.
"The market is now transitioning into a new phase, where delivery, occupancy and investment performance are becoming just as important as the scale of the development pipeline," he added.-TradeArabia News Service
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