Across the Middle East, hotel development is entering a new era. In this transformative phase, cultural depth, sustainability and guest experience are taking precedence over iconic skylines and brand names. Increasingly, the conversation is about how hospitality investments align with national priorities, from environmental goals to social impact and good governance.
From Saudi Arabia, Oman and Qatar to the UAE, destinations are shaping tourism projects to serve a broader purpose. Countries are today tying hospitality to national visions. And what used to be a luxury-focused sector is now also becoming a tool for inclusive and sustainable national growth.
Saudi Arabia: tourism with a purpose
In Saudi Arabia, hotel development is being used to advance cultural preservation, economic opportunity and regional equity. Projects in Al-Balad, AlUla, and Asir have been carefully curated to highlight local heritage and natural beauty. These aren’t isolated tourism zones; instead, they are part of a broader effort to reshape the national economy and narrative.
What stands out is the focus on depth. By engaging local communities, supporting entrepreneurs and creating jobs in emerging regions, the tourism sector is becoming a platform for regeneration, not just recreation. Importantly, this approach ensures that green principles are embedded in every project from conception to completion.
UAE: new destinations, new thinking
In the UAE, growth is taking a more deliberate shape. National and emirate-level plans are pushing development into less saturated areas like Hatta and Al Ain. These destinations are built with care – respecting natural settings, celebrating heritage and opening up new areas to visitors.
Hospitality investments in these regions serve as magnets for wider economic activity. Small businesses, artisans, transport providers and food producers all stand to benefit when tourism is designed with them in mind. In some cases, public initiatives are helping with this connection through SME incentives, startup support and streamlined licensing.
Oman: a model of moderation
Oman has quietly championed an environmentally responsible approach for decades. Tourism here has long been tied to the landscape and cultural fabric of the country. Vision 2040 continues this approach with a focus on thoughtful development that adds value without overwhelming resources.
Smaller-scale projects, locally sourced materials and policies that keep wealth circulating within communities are the norm. Programs supporting Omani entrepreneurs, including financing tools and land access, help ensure tourism strengthens – not sidelines – local economies.
Qatar: rethinking urban tourism
Qatar’s tourism landscape is highly urbanized, but the push for environmentally responsible development is real. With the FIFA World Cup – hailed as the greenest in the tournament’s history – now in the rearview mirror, the country is doubling down on green building standards, energy-efficient systems and new models of city planning.
More interesting still is the effort to link hotel projects to other national goals: supporting creative industries, empowering small businesses and developing workforce skills. Procurement networks are being opened to local suppliers and cultural districts are being tied directly to hospitality hubs. The impact may be concentrated in Doha, but the ripple effects are broadening.
What ESG looks like in practice
Across the region, ESG isn’t just a framework – it’s being embedded in projects, policies and priorities. On the environmental side, this means energy-conscious design, water reuse systems and reduced waste. Socially, it means hiring locally, upskilling teams and respecting cultural context. Governance involves responsible sourcing, transparent development processes and listening to community voices from the start.
Another layer that’s gaining importance is the broader economic influence. Hotel projects are being asked to do more: to spark growth across supply chains, to include small businesses and to create indirect jobs. Several governments are beginning to facilitate this through public-private partnerships that connect developers with local producers, craftspeople and service providers.
Changing traveler expectations
Tourism markets are evolving too. Today’s guests – particularly younger and more socially conscious ones – expect more from destinations. They want to know where their money is going, who benefits and how their experience supports the local context. That shift is pushing developers to think beyond aesthetics and into meaning.
Hotels that can show they are part of something bigger – whether it’s a local employment initiative or a heritage preservation plan – are winning both guests and goodwill. This trend demonstrates how sustainability has become a competitive advantage rather than just a compliance requirement.
Finance is following impact
The capital behind hospitality is changing. More investors are applying ESG filters to their portfolios. Banks are offering green loans. And governments are prioritizing sustainable projects in their tourism campaigns and investment strategies.
Instruments such as green bonds, sustainability-linked loans and third-party certifications are helping developers structure projects that are financially viable and socially valuable. The economics are aligning with the ethics, which makes the case for ESG integration all the stronger.
Sustainability: driving different growth
Taken together, these shifts mark a broader evolution. Hotel development in the region is no longer just about drawing tourists – it’s about building national resilience.
Sustainability is not something tacked on after the fact. It’s becoming part of the planning, the financing and the delivery of every major project.
The result is not only more meaningful destinations, but also a stronger foundation for long-term competitiveness. These aren’t just places to stay. They’re places that will stay relevant.
Nicolas Mayer,
PwC Middle East partner, tourism, sports and entertainment leader
pwc.com
