JEDDAH: The hospitality sector has been hard hit by the pandemic. In Saudi Arabia, international flights have been suspended since March 2020. The Hajj and Umrah seasons, which are major drivers of the market, have been canceled, meaning the industry lost millions of national and international pilgrims over the past year.
However, as the region prepares to travel again, a strong recovery is expected in the next 12 months.
“I believe it will be a good year, at least 12 months, before we see things come back in full force,” said Dimitris Manikis, President and Chief Executive Officer Europe for the Middle East and Africa (EMEA) in Wyndham Hotels and Resorts (WHR) said Arab News.
The EMEA president of the world’s largest hotel franchisor stressed that the desire for travel only increased during the pandemic, particularly with the spread of vaccines and the increasing interest of governments in health passports to enable safe travel.
The extent to which these measures will have an immediate positive effect on the recovery of the sector will not be announced until the next few months, according to Manikis.
But Manikis said, “We are already seeing recovery in certain markets. In the United Arab Emirates, for example, we are seeing hotels with 65 to 85 percent occupancy and rave parties are returning. “
WHR has 43 hotels in the UK, United Arab Emirates, Qatar, Oman, Bahrain and Kuwait. Another 11 hotels and around 2,500 rooms are in the development pipeline.
In Saudi Arabia, WHR currently has 13 hotels with over 1,800 rooms. The largest representation is the most popular brand, the Ramada by Wyndham.
In addition, WHR is expected to open a new Ramada hotel in Riyadh and two in the city of Alkhobar in 2021 and 2022.
“Saudi Arabia is such an important market not just for Wyndham, but for the entire region and for every single brand that has a presence in the country,” said Manikis.
BRIEF INFORMATION
• Wyndham Hotels and Resorts currently has 13 hotels with over 1,800 rooms in Saudi Arabia.
• One new Ramada hotel is expected to open in Riyadh and two in Alkhobar in 2021 and 2022.
• About 25 percent of the WHR pipeline is in Saudi Arabia.
The most vibrant area for the Saudi hotel market has been the holy cities of Makkah and Madinah, where religious travel has been the main driver of hotel investment in the kingdom for many decades. However, Manikis is looking to future opportunities that the newly introduced tourism projects could offer the sector.
“There are some amazing projects coming up. I think this is a tremendous opportunity for us and other brands to demonstrate our ability to be part of the Kingdom’s new hospitality plan, ”he said.
In recent years, Saudi Arabia has focused on improving investment opportunities in the hospitality industry by launching several projects including Qiddiya, the Red Sea Project, Amaala, NEOM, AlUla and the Wadi Al-Disah Development. These major projects were launched by the Public Investment Fund to meet the tourism target in the Vision 2030 reform plans.
Manikis described Saudi society as vibrant with a growing middle class, making the country’s market a seedbed for a balanced, diverse mix of luxury to budget hotels.
According to Manikis, Saudi consumers travel in large families, stay longer, and want certain amenities and facilities when they travel. However, given the changing tourism scene in the UK, he said, “It will be interesting to see changes in market performance and consumer behavior.”
Regionally, around 25 percent of the WHR pipeline is in Saudi Arabia. The chain’s Ramada has been a strong brand in the Kingdom since the company entered the Saudi market in 2004.
Manikis anticipates a possible surge in demand for economy brands, but insists that ranges in the Saudi market will fluctuate.
A report earlier this month found that Saudi Arabia has the world’s largest hotel pipeline and room availability is expected to grow 67.1 percent over the next three years. This is the highest value among the 50 most populous countries. The data showed 73,057 rooms in the Saudi hotel pipeline, with 16,965 expected to go online in 2021.
As the industry looks forward to a successful rebound, the pandemic has caused market participants to rethink the provision of services and experiences to their guests.
Manikis emphasized that consumers are now expecting a digital transformation in hotels. At the same time, a new product segment such as long-term stays and serviced apartments will grow.
In addition, in the coming months it will also be found out how people interact with each other and with public spaces.
Manikis said we may see bigger lobbies and spaces, less furniture and fewer accessories in hotel rooms, and new alternatives to food buffets.
However, more changes will come in the third and fourth quarters of this year as people start traveling again.
