More than 2,000 keys of branded supply joined the Saudi market during the second quarter of 2019, with 60% classified in the 4-star segment, Colliers International said in its quarterly review.
4-star supply typically caters to a wide range of travellers, a factor of its greater affordability compared to 5-star hotels and a greater level of service compared to 3-star hotels.
Jeddah Season played a significant role in Jeddah’s performance during the first half of 2019, establishing the potential for market recovery in the coastal city in full-year 2019.
With the successful launch of Jeddah Season, Saudi Seasons are expected to broaden the kingdom’s appeal to leisure travellers across the region.
Backstreet Boys, Super Junior, and Afrojack performed in the city, while visitors could take part in the many pop up spaces and cultural events.
Colliers, the leading global real estate services and investment management company, said that the countrywide growth rate is expected to reach 9% per year.
The review pointed out that the kingdom needs to attract additional regional and domestic tourists in order to maintain current occupancy levels.
In Riyadh, the occupancy rate increased by 5% in H1-19, while Jeddah’s occupancy remained unchanged over the same period.
“The Jeddah Season had a marked effect on the city’s occupancy and combined with few properties entering the supply in H1-19,” the report said.
The improved levels of demand in the city are expected to result in an improvement in FY 2019 in occupancy.
Moreover, multiple projects expected to open in 2019 have been delayed.