Hospitality - Alpen Capital

After making a remarkable recovery post COVID-19 pandemic, the GCC hospitality sector is poised for robust growth and transformative changes in the coming years. Growth of the sector is being spurred by economic recovery, thriving tourism and concerted efforts of the governments to reduce reliance on hydrocarbon revenues. A rising trend towards sustainable tourism and responsible travel is gaining ground across GCC’s hospitality sector due to increasing ecological awareness among consumers worldwide. The region, especially Saudi Arabia and the UAE, is witnessing a record number of tourist arrivals due to airport expansions, construction of luxury hotels and resorts, opening of world class tourist attractions, accompanied with promotion of MICE and corporate tourism.

Alpen Capital’s comprehensive industry research reports on the hospitality sector feature forecasts on key performance indicators such as RevPar, ADR and occupancy rates, along with in-depth analysis on recent trends, growth drivers and challenges facing the segment. Furthermore, the report also profiles some of the hospitality companies in the region.

Featured Report

GCC Hospitality Industry Report 2024

June 11, 2024

According to Alpen Capital, the GCC hospitality sector revenue is expected to grow at a CAGR of 7.5% from 2023 to 2028, reaching approximately US$ 48.1 billion by 2028. Growth of individual GCC countries is expected to range from a CAGR of 6.9% to 11.0% between 2023 and 2028. Saudi Arabia is projected to grow in line with the GCC average of 7.5%, whereas the UAE is expected to grow at a CAGR of 6.9%. Smaller markets are expected to witness high growth rates during the forecast period, with Qatar at 11.0%, Kuwait at 10.5% and, Oman and Bahrain at 9.0% CAGR.

Given the projected growth of the GCC’s hospitality sector, its three key operating metrics - Occupancy Rate, Average Daily Rate (ADR) and Revenue Per Available Room (RevPAR) - are expected to improve over the next five years. The occupancy rate in the GCC is estimated to rise consistently due to increasing tourist arrivals. It is forecasted to grow from 64.6% in 2023 to 69.3% in 2028. ADR is expected to increase at a CAGR of 1.9% during the same period, from USD$ 166.4 to US$ 182.7, whereas RevPAR is forecasted to grow at a CAGR of 3.3% from US$ 107.5 in 2023 to US$ 126.6 in 2028.