The Middle East hotel construction pipeline hit an all-time high in the second quarter of 2023 with 597 projects and 146,521 rooms, up 10 percent and 5 percent, respectively, year-over-year (YoY), US-based global hotel intelligence provider Lodging Econometrics said in a report.

Projects under construction stand at 330 projects with 90,619 rooms at the close of the second quarter. Projects scheduled to start construction in the next 12 months increased 17 percent YoY to 102 projects with 23,909 rooms.

Projects in the early planning stage increased 31 percent YoY, reaching their highest levels since 2008, to 165 projects and 31,993 rooms.

Saudi Arabia leads Middle East countries with the highest number of projects in the construction pipeline in the second quarter, reaching an all-time high of 276 projects and 72,144 rooms. The UAE follows with 106 projects and 27,921 rooms, Egypt (91 projects/20,814 rooms), Qatar (43 projects/10,267 rooms) and Oman (33 projects/6,792 rooms).

The report said that 92 percent of the hotel projects in the Middle East’s current pipeline are located within these five countries.

Dubai’s construction pipeline consists of a significant portion of the projects in the UAE’s total pipeline with 67 projects and 19,200 rooms. On the other hand, Ras Al Khaimah has 15 projects with 4,464 rooms and Sharjah has 13 projects/1,766 rooms.

Three of the top five cities with the largest pipelines are in Saudi Arabia, comprise 42 percent of the projects and 36 percent of the rooms in the total Middle East construction pipeline.

The Middle East opened 16 new hotels/3,892 rooms in the first half of 2023 with another 93 new hotels/21,306 rooms scheduled to open by year-end.

Lodging Econometrics expects new hotel openings to rise to 113 projects/28,857 rooms in 2024, while 97 projects/18,914 rooms are likely to open by the end of 2025.

(Reporting by P Deol; Editing by Anoop Menon)

(anoop.menon@lseg.com)

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