Middle East: Hotel projects under construction increase 8% YOY at Q1 2025
Middle East hotel pipeline grows in Q1 2025 to 634 projects. Saudi Arabia, Egypt, and UAE lead; luxury, upper upscale segments hit records.
PORTSMOUTH, NH – The Q1 2025 Hotel Construction Pipeline Trend Report for the Middle East from Lodging Econometrics (LE) reveals, at the Q1 close, the hotel construction pipeline in the region increased to 634 projects/158,656 rooms, up 4% by projects and 10% by rooms year-over-year (YOY).
At Q1 2025, projects currently under construction stand at 327 projects/84,434 rooms, up 8% by projects and 5% by rooms YOY. Projects scheduled to start construction in the next 12 months stand at 158 projects/47,201 rooms, up 19% by projects YOY and 55% by rooms YOY. Projects in the early planning stage stand at 149 projects/27,021 rooms. New project announcements in the Middle East at the first quarter close stand at 41 projects/9,068 rooms, while new construction starts stand at 39 projects/6,910 rooms, up 63% by projects and 21% by rooms YOY.
By chain scale, LE analysts report several record highs reached in Q1 2025. The luxury chain scale achieved all-time high totals with 185 projects/42,268 rooms, while the upper upscale chain scale reached record highs with 153 projects/37,946 rooms. Together, these top two chain scales account for 54% of projects and 55% of the rooms in the region's pipeline. Additionally, brand conversions reached record totals with 55 projects/12,436 rooms.
LE analysts report that at Q1, the top Middle Eastern countries with the greatest number of projects are Saudi Arabia, with 319 projects, accounting for 85,416 rooms – a record high room count. Egypt follows with record-high counts of 125 projects and 28,768 rooms. Next is the United Arab Emirates with 102 projects/27,279 rooms, Oman with 27 projects/4,680 rooms, and Qatar with 20 projects/4,476 rooms.
Cities in the Middle East with the largest pipelines at Q1 are led by Riyadh with 87 projects/17,519 rooms, Dubai with 56 projects/15,073 rooms, Jeddah with 50 projects/10,386 rooms, Cairo with 45 projects/10,218 rooms, and Makkah with 24 projects/17,386 rooms. Ninety-four percent of the projects and 95% of the rooms in the region's total construction pipeline are located within these five cities.
During the first quarter, the Middle East opened 9 new hotels/2,130 rooms. LE is forecasting an additional 99 new hotels/23,505 rooms to open throughout the remainder of the year for a total of 108 new hotels/25,635 rooms to open by year-end 2025. By year-end 2026, LE analysts forecast another 109 new hotels/20,806 rooms to open across the Middle East.
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