The Red Sea Development Company, developer of the mega-tourism project on Saudi Arabia’s west coast, signed nine management agreements with international hotel brands for the first phase of its luxury project and expects to announce hospitality partnerships in the coming months.
The nine hotels include Edition Hotels and St Regis Hotels & Resorts, part of Marriott International; Fairmont Hotel & Resorts, Raffles Hotels & Resorts and SLS Hotels & Residences, part of global hospitality group Accor, according to a statement. Other hotels include the Grand Hyatt, part of Hyatt Hotels Corporation; Intercontinental Hotels & Resorts and Six Senses, part of IHG Hotels & Resorts; and Dubai hospitality group Jumeirah Hotels & Resorts.
"Such partnerships with globally recognised and respected brands signifies the growing confidence in our business, our flagship destination and in Saudi Arabia as a tourism destination," John Pagano, chief executive of TRSDC, said on Wednesday.
The large-scale projects being developed by companies such as the TRSDC are part of the kingdom's efforts to diversify its economy and cut its dependence on oil revenue. Development of non-oil sectors such as tourism are key planks of the kingdom's Vision 2030 economic transformation agenda.
The hotel agreements were announced during the second day of the Future Investment Initiative (FII) in Riyadh. The hospitality brands will operate nine of the 16 properties under development in the first phase, which involve more than 1,700 hotel keys of the total 3,000 planned for the initial stage.
"We are working with world-leading hotel operators who share our vision to deliver exciting growth opportunities for the kingdom’s tourism and hospitality market, whilst protecting the natural environment, benefiting our local community and delivering extraordinary and immersive guest experiences," Mr Pagano said.
The first phase of the project will also include a luxury marina, an 18-hole championship golf course, entertainment and leisure facilities and an international airport that is expected to serve up to one million passengers a year by 2030.
The Red Sea project’s first phase of development is on track for completion by the end of 2023, according to the statement. This will include 16 hotels that will offer 3,000 rooms across five islands and two inland sites.
TRSDC, which raised 14 billion Saudi riyals ($3.73 billion) in green financing earlier this year, will tap the debt market for financing of its subsequent phases but currently does not have capital requirement for the first phase, Mr Pagano told The National in an interview in September.
The company, which awarded contracts worth 14.5bn riyals in 2020, planned to award another 18bn riyals worth of contracts in the next 18 months as it begins construction of hotels and an airport, Mr Pagano said at the time.
Once fully completed in 2030, the site will host 50 hotels with up to 8,000 hotel rooms and approximately 1,000 residential properties across 22 islands and six inland sites.
By 2030, the Red Sea project expects to host one million visitors annually, capped in line with its sustainability goals, creating more than 70,000 new jobs and contributing 22bn riyals to the kingdom's gross national product once fully operational, according to the statement.