InterContinental Hotels Group joins slate of planned mega hotel properties in Saudi Arabia

A surge in religious travel has several hotel companies turning to Saudi Arabia for growth and expansion.

InterContinental Hotels Group (IHG) and Marriott are just two of the companies that have announced plans to build new properties in the region.

Last month, plans for the world’s largest hotel were announced, also in Mecca; the 10,000-room Abraj Kudai hotel is underway at a cost of $4.5 billion. The project is being led by the Saudi Ministry of Finance.

Mega properties are being announced as the Holy City is increasingly developed.

IHG said the largest Holiday Inn property in the company is being built in Saudi Arabia; the first phase of the project will see 1,650 rooms open in Mecca by the end of the year.

“As we celebrate our 40th year in Saudi Arabia, we are all the more focused on continuing our expansion in this key market. With religious travel growing, and the government set to improve infrastructure in line with this, there is a need for more branded accommodation in the Holy Cities of Mecca and Medina,” said Pascal Gauvin, chief operating officer, India, Middle East and Africa for IHG.

When complete, Holiday Inn Mecca Abraaj Al Tayseer will have 5,154 rooms spread across five towers. Two of the towers are nearing completion; the final three will be finished over the next three years.

The company said the property is being built in response to increased religious travel. IHG’s analysts expect travelers undertaking hajj to more than double, growing from 2 million in 2013 to more than 5 million over the next 15 years. The kingdom is preparing for this increase in visitors by expanding Jeddah’s airport – capacity is expected to increase to 80 million people over the same time.

IHG struck a partnership with Al Majd Al Arabiah Company to develop the Holiday Inn. Selman Al Fares, of the Riyadh-based firm, said Mecca is at the core of the country’s ‘distinctive’ tourism market.

“IHG as an operator understands the market, and during our years of partnership they have demonstrated their credentials as a strong partner with whom we are happy and comfortable to embark on this ambitious project,” said Al Fares. “This is a milestone development for us and we’re confident Holiday Inn Mecca Abraaj Al Tayseer will bring the Holy City’s hospitality to another level.”

While visiting the recent Arabian Travel Market conference in Dubai, Arne Sorenson, CEO of Marriott International, said his company expects to add 240 hotel properties in the region and Africa over the next five years.

“The Middle East and Africa region offers a tremendous opportunity for Marriott International,” said Sorenson. “We have ambitious plans for growth internationally and the region will play a large part in helping us achieve both our short-term and long-term targets. By the end of this year we should surpass 1 million rooms open or in development worldwide, with new hotels expected to create 150,000 new hotel jobs as they open.”

The company will open a 426-room hotel in Mecca this year.