Marriott’s Giga-Resort in Saudi Arabia Banking on Cash-Rich Locals

The next generation of Saudi Arabian hotels is coming, marked by the opening of the Kingdom’s multi-billion-dollar giga-projects. Marriott is showing what is possible at these spare-no-expense properties: Asking for the highest room rates in the country.

Skift’s Josh Corder reports:

Just two hotel operators are entrusted to introduce Saudi Arabia’s “untouched” Maldives-rivaling Red Sea to international guests: Marriott and IHG. Three of the planned 50 hotels at the $50 billion giga-project open this year, a St. Regis and Ritz-Carlton Reserve from Marriott and a Six Senses from IHG.

For Marriott, it’s familiar territory. The group operates the ultra-exclusive and somewhat secretive Bulgari Resort in Dubai, a vast St. Regis Resort on Abu Dhabi’s Saadiyat Island, and another St. Regis on Qatar’s Marsa Arabia island.

Much like these fellow five-star island properties, Marriott’s St. Regis Red Sea Resort appears to be positioning itself a cut above other hotels in the country. Currently, the property is bookable for stays from February 1, 2024 (the official word is that it will open before the end of 2023). Priced at about $1,600 a night (6,037 Saudi Arabian riyals) a night, it is comfortably one of the country’s most expensive hotels — comparable only to IHG’s Six Senses nearby.

Six Senses The Southern Dunes, The Red Sea takes bookings from November 1, and, with an imposed two-night minimum stay, rates start from about $1,700 a night (6,618 riyals) a night.

Bookings for the ‘Nujuma’ Ritz-Carlton Reserve resort have not yet opened.

The St. Regis will have just 90 keys, all of which will be villas.

While the hotels are said to open this year, they won’t see international guests until 2024. The project’s Red Sea International Airport — also developed by the same company, Red Sea Global — will operate domestic flights this year and international next year. Dubai will be the first overseas destination connected to the new airport.

Made For Mocktails

For this domestic crowd, which will fly in from Jeddah and Riyadh, pricing remains a barrier. In Knight Frank’s Saudi Report 2023, cost was a reason why respondent Saudi travelers would not stay in a hotel in their own country. The survey found that 28% of 25–35-year-olds put it as their biggest barrier, 41% of those up to 45 years old said the same, and 54% of those over 45.

For young Saudis, the thing that put them off most from staying at domestic hotels was restrictions. Alcohol, for example, remains prohibited.

Speaking with the FII Institute earlier this year, Red Sea Global group CEO John Pagano assured that his post-card tourism project “doesn’t need alcohol.”

“Alcohol is not on the agenda,” Pagano said. “I don’t think it’s absolutely necessary. There’s a new industry evolving. The no/low alcohol industry, it’s booming.”

The St. Regis Red Sea Resort will have its own St. Regis Bar, complete with oysters and caviar, live music, and mocktails.

More broadly, Pagano said visitors will discover a changing Saudi Arabia.

“I’ve seen so much change in the five years I’ve been here — it’s incredible,” Pagano said. “Western attire will be perfectly acceptable within the destination. Obviously, if you wander into some of the local towns, we expect people to respect the customs and cultures. Within the resorts, you can wear bikinis without any issue.”

—Story by Josh Corder