Saudi Arabia is rapidly expanding its hotel sector as the Kingdom prepares for a much larger and more diverse tourism economy.
In this Property News International recap, we examine new data from JLL, which shows strong hospitality performance in the Holy Cities. Hotel occupancy reached 68.2% in Makkah and 75.1% in Madinah in the year to June 2026, with the two cities now offering a combined 354,800 hotel keys.
New supply is continuing to enter the market, with approximately 1,100 hotel keys added in Makkah during the second quarter and another 220 keys in Madinah. But performance varies across the Kingdom, with Riyadh occupancy falling to 47.6% and RevPAR declining 23.2% amid softer corporate demand and increasing supply.
The wider expansion reflects Saudi Arabia’s push to grow beyond religious tourism, with investment across infrastructure, entertainment, connectivity, business travel, and new destinations under Vision 2030.
Watch the full video to understand why Saudi Arabia is building so many new hotels and how its hospitality market is evolving.
