Oussama El Kadiri, partner and head of hospitality, tourism and leisure advisory MENA at Knight Frank, discusses the MENA region’s unprecedented hospitality investment opportunities.
Promising hospitality opportunities
In light of Expo 2030 and World Cup 2034 announcements, Saudi Arabia now showcases an array of hidden destinations that are worth discovering and developing. Moreover, there are increasingly varied investment opportunities across eco-tourism, heritage, resorts and family-focused concepts outside Saudi Arabia’s core cities. Meanwhile, as the UAE draws in more foreign capital, its global appeal and reinvention ethos continuously attract loyal, repeat visitors in large numbers. Notably, this gives the UAE a competitive edge over neighboring countries, reinforcing its reputation as a dynamic hospitality investment destination. Furthermore, income-producing hospitality asset liquidity has improved. At the same time, Egypt is growing in appeal to GCC investors, driven by mega-projects such as Ras El Hekma.
Consequently, hospitality remains a preferred investment in Egypt, especially for those aiming to hedge against persistent currency fluctuation risks and volatility. Lastly, Morocco recently recorded Africa’s highest tourist arrivals, surpassing Egypt, and is gaining traction with World Cup 2030 preparations underway. As a result, Morocco is set to consolidate its tourism gains, offering prime growth opportunities across major cities and surrounding investment zones.
Traveler preferences
As travelers become more sophisticated, experiential tourism has grown, offering adventure, eco-tourism, culture, heritage and immersive routes across the region. Consequently, our research indicates younger generations, especially Gen Z, prioritize experiences as the top factor when selecting accommodation for travel purposes. Therefore, concept development and offerings to guide sustainable and future-proof investment decisions in hospitality.
Meanwhile, as non-room revenue gains share in the hotel business mix, food and beverage offerings are becoming more strategically important. Additionally, demand for live events is rising, and affordable design innovations are helping to enhance guest experience.
In parallel, luxury travel trends now focus on personalization, wellness-centric stays and “B-leisure,” boosting average guest stay durations.
Furthermore, medical wellness offerings are gaining traction; however, they require in-depth feasibility analysis to ensure profitability and maximize investor returns effectively. At the urban level, integrated UAE-based mixed-use developments combining hotels, branded residences and commercial areas are emerging across the region’s primary cities.
Impact of mega-projects
The significant efforts in marketing the mega-projects outside the MENA region in European and US key cities has sparked wider interest curiosity for leisure tourism in Saudi Arabia and the GCC region. The recent World Cup, Winter Olympics and Expo 2030 announcements further cemented Saudi Arabia’s appeal for tourists on the mid to long term. As the first phases of mega projects such as Diriyah have been completed, leisure tourism has sky-rocketed in the capital and is expected to lead the way for the wider kingdom.
The recorded recovery of Qatar tourist influx after the expected post world-cup dip, is a testament of the new status the wider region has a new tourism hub. We expect Saudi Arabia to also benefit from a sustainable influx of leisure tourists which will redefine cultural, natural and experiential travel in the region.
Forecasts for the region
To begin with, the GCC hospitality sector is projected to grow significantly, with revenues reaching USD 48.1 billion by year 2028.
Moreover, Saudi Arabia currently leads regional infrastructure investment, committing USD 1.2 trillion to hospitality projects, closely followed by the UAE. At the same time, topline performance across the MENA region remains strong despite occasional volatility caused by ongoing geopolitical instability.
Nevertheless, the region’s hospitality sector continues to demonstrate resilience.
As a result, these strategic efforts are positioning the region as a leading global tourism hub.
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