Makkah Gears Up for Ramadan with Tourism Drive, Record Hospitality Growth https://english.aawsat.com/business/5242092-makkah-gears-ramadan-tourism-drive-record-hospitality-growth-%C2%A0
Makkah Gears Up for Ramadan with Tourism Drive, Record Hospitality Growth
Tourism Minister Ahmed Al-Khateeb and other officials during his inspection tour on Tuesday. (Asharq Al-Awsat)
Saudi Arabia’s Ministry of Tourism has raised the readiness of Makkah’s hospitality sector to its highest level ahead of the holy month of Ramadan, stressing that serving pilgrims and visitors remains a top national priority.
Makkah is preparing to receive worshippers and visitors amid a marked expansion in hospitality capacity. The city now has more than 2,200 licensed accommodation facilities, reflecting growth of 35 percent over the past year. The number of licensed hotel rooms has exceeded 380,000, up 25 percent, while total domestic and inbound tourism spending is projected to surpass SAR 143 billion ($38.1 billion) in 2025.
The wider Makkah region recorded unprecedented performance indicators last year, both in visitor numbers and tourism spending, underscoring sustained growth and operational readiness.
Total domestic and international visitors exceeded 50 million, marking a 14 percent increase compared with 2024.
Tourism Minister Ahmed Al-Khateeb announced the figures during an annual inspection tour on Tuesday, stressing that the indicators reflect a major expansion in accommodation capacity and record growth in visitor numbers.
The tour included inspections of temporary lodging facilities designated for pilgrims, part of a proactive plan to increase capacity during peak seasons, alongside early preparations for the upcoming Hajj.
Vision 2030 targets surpassed
Official data has shown that Saudi Arabia has exceeded its Vision 2030 targets for the Umrah. The number of pilgrims arriving from abroad rose from 8.5 million in 2019 to more than 18 million in 2025, surpassing the original goal of 15 million by 2030.
A number of hotels surrounding the Grand Mosque in Makkah. (General Authority for Awqaf)
Service quality indicators improved as well, with pilgrim satisfaction reaching 94 percent, exceeding Vision 2030 benchmarks.
Workforce development kept pace with demand, as the number of licensed tour guides rose to more than 980, a 23 percent increase.
Masar Mall project
Al-Khateeb announced a joint financing agreement between the Tourism Development Fund and the Arab National Bank with Hamat Holding to support the Masar Mall project. The development carries a total cost of SAR 936 million (about $250 million).
The project is expected to become the largest shopping center in Makkah with the capacity to accommodate around 20 million visitors annually.
Its location near the Haramain High-Speed Railway station and a direct pedestrian link to the Grand Mosque are expected to strengthen the city’s commercial and tourism infrastructure.
Jeddah: Gateway to pilgrims
Meanwhile, Jeddah continues to consolidate its position as a complementary destination to Makkah and a primary gateway for pilgrims, while also expanding its role as a coastal tourism hub.
The city welcomed more than 13 million domestic and international visitors in 2025, a 10 percent increase from 2024. Tourism spending reached SAR 28 billion ($7.47 billion), up 6 percent year on year.
Jeddah’s hospitality sector also expanded, with more than 500 licensed facilities and over 33,000 licensed rooms.
The city is currently developing 46 tourism projects valued at SAR 21 billion ($5.6 billion) and expected to add more than 11,000 hotel rooms and further strengthen its tourism infrastructure and economic value.
Council of Economic and Development Affairs Stresses Saudi Economy’s Resiliencehttps://english.aawsat.com/business/5327582-council-economic-and-development-affairs-stresses-saudi-economy%E2%80%99s-resilience
Council of Economic and Development Affairs Stresses Saudi Economy’s Resilience
A previous CEDA meeting chaired by the Saudi Crown Prince. SPA
The Saudi Council of Economic and Development Affairs (CEDA) has discussed during a virtual meeting developments in the global economy amid rapidly changing geopolitical conditions and their effects on the national economy with the Kingdom’s Purchasing Managers’ Index (PMI) rising to 53.8 in August 2026 from 53.1 in July.
CEDA discussed the Ministry of Economy and Planning’s monthly report and examined developments in the global economy, including rising inflationary pressures and tighter monetary policies adopted by major central banks, the Saudi Press Agency reported on Thursday.
It also discussed the implications for Saudi Arabia, highlighting the national economy’s resilience and ability to navigate regional and international challenges while identifying opportunities arising from the changing economic environment.
The report showed that the Kingdom’s Purchasing Managers’ Index (PMI) rose to 53.8 in August 2026 from 53.1 in July, marking the fifth consecutive month of growth.
The Business Confidence Index also increased to 56.7, up 0.2 points from the previous month, reflecting continued confidence in the outlook for the Saudi economy.
The council reviewed a separate report from its Strategic Management Office on the performance of Saudi Vision 2030 programs and national strategies during the second quarter of 2026.
The report highlighted the transformation achieved over the past decade and outlined the next phase of Vision 2030, focused on maximizing impact, consolidating gains and sustaining progress across its three pillars: a vibrant society, a thriving economy and an ambitious nation.
The council also examined the Quality of Life Program Center’s 2025 annual report, which showed that the program’s initiatives contributed 44% in local content by the end of 2025, exceeding the target of 37%.
The initiatives contributed SR78 billion ($20.8 billion) to gross domestic product, surpassing the target of SR77.1 billion ($20.6 billion).
In addition, the council reviewed the 2025 annual report of the Citizen Account Program.
The council also discussed a second-quarter report from the National Center for Performance Measurement (Adaa), covering government agencies’ performance and progress toward Vision 2030 targets.
The report outlined efforts to improve government performance through strategic reviews, performance monitoring, addressing implementation challenges and identifying opportunities for improvement.
The council also discussed a second-quarter report from the National Center for Performance Measurement (Adaa), covering government agencies’ performance and progress toward Vision 2030 targets.
The report outlined efforts to improve government performance through strategic reviews, performance monitoring, addressing implementation challenges and identifying opportunities for improvement.
US Stocks Pull Back on Oil, Iran War Worrieshttps://english.aawsat.com/business/5327448-us-stocks-pull-back-oil-iran-war-worries
A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, US, November 11, 2022. REUTERS/Andrew Kelly/File Photo
A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, US, November 11, 2022. REUTERS/Andrew Kelly/File Photo
Wall Street stocks slipped early Thursday, after oil prices soared on reports that the United States could launch fresh attacks on Iran before key midterm elections.
The Dow Jones Industrial Average dipped 0.2 percent to 51,074.31, while the broad-based S&P 500 Index lost 0.3 percent to 7,776.28.
The tech-focused Nasdaq Composite Index retreated 0.5 percent to 27,405.11, AFP reported.
The gloomier start was "based on two factors that have been haunting the market: both oil prices rising sharply and also (bond) yields that are returning to yesterday's peak levels," said Peter Cardillo of Spartan Capital Securities.
He told AFP that these will be an "ongoing problem for the market in the near term."
Cardillo said that oil prices have jumped as US President Donald Trump said he did not want to deal with Iran.
"And now it looks as though there's been a shift in strategy from an economic squeeze on the Iranian economy to a new round of massive bombing," he warned.
After reports that Washington could open new attacks against Iran, international benchmark Brent North Sea crude rallied to $105.46 per barrel.
The main US contract, West Texas Intermediate rose to $92.82 per barrel before cooling slightly.
Meanwhile, the yield on the 10-year Treasury note advanced to 5.3 percent and that on the 30-year note was at 5.7 percent.
A Year After Riyadh Halted Rent Hikes, the Market Tests a New Balancehttps://english.aawsat.com/business/5327399-year-after-riyadh-halted-rent-hikes-market-tests-new-balance
A Year After Riyadh Halted Rent Hikes, the Market Tests a New Balance
Development work on plots during the first year of the Real Estate Balance Program in Riyadh (SPA)
A year after regulations freezing rent increases began to take effect, the rental market in Riyadh has begun to show a clear shift in the trajectory of prices. Residential rents grew by 4.5 percent in August 2026, the slowest pace of increase in more than three years, while the share of household income absorbed by rent declined to about 15 percent, from more than 17.5 percent a year earlier.
These developments point to a gradual easing of the price pressures that drove rents to high levels in recent years, but they are not enough on their own to conclude that the market has entered a sustainable equilibrium. Rental activity continues to grow, while the market still needs to absorb new supply and determine the impact of the regulations on the decisions of investors, developers and tenants.
The regulatory provisions governing the relationship between landlords and tenants in Riyadh were issued on September 25, 2025, pursuant to the directive of Crown Prince and Prime Minister Mohammed bin Salman to take measures to achieve balance in the capital’s real estate sector, with the approval of the Council of Ministers and by royal decree. The provisions were later published in the official gazette, Umm Al-Qura, and took effect on November 7 of the same year. They remain in effect for five years and provide for a freeze on annual rent increases for residential and commercial properties within Riyadh’s urban boundaries, in addition to regulating rents for vacant properties that had previously been leased and setting rules governing contract renewals and evictions.
These provisions formed part of a broader package of measures aimed at restoring balance to the capital’s real estate market. The package included increasing the supply of residential land, developing the system of white land and vacant property fees, strengthening the regulation of rental relationships, and raising levels of documentation and transparency.
Development works on plots during the first year of the Real Estate Balance Program in Riyadh (SPA)
About a year after the provisions took effect, the capital’s rental market has begun to show signs of gradual repricing, with slower rent growth and a decline in the burden of rent on household income. However, the extent to which the market moves toward a more sustainable equilibrium will remain linked to the trajectory of new supply, development and financing costs, and households’ ability to afford housing.
The latest available data indicate that residential rents in Riyadh rose by 4.5 percent year-on-year in August 2026, marking the 12th consecutive month of slower growth and the lowest pace of increase in more than three years, according to an analysis based on data from the General Authority for Statistics.
Although rents continued to rise year-on-year, the slower pace reflects a gradual easing of the price pressures that the capital experienced in recent years, alongside a package of government measures aimed at restoring balance to the real estate market.
The regulation of the rental market was part of this package, which included increasing the supply of residential land, developing the system of white land and vacant property fees, as well as strengthening the regulation of rental relationships and raising levels of documentation and transparency in the market.
In an indicator directly linked to households’ ability to afford housing costs, the share of rent in household income in Riyadh declined to about 15 percent, compared with more than 17.5 percent in September 2025.
Abdullah Al-Hammad, CEO of the General Real Estate Authority, said last September that this decline was one of the initial effects measured from the real estate balance decisions in the capital.
This indicator is particularly significant because it measures the share of rent in household income, providing a clearer reading of changes in housing affordability and the impact of market movements on tenants.
This coincided with a continued slowdown in housing-related inflation across the Kingdom. The growth rate of prices in the housing, water, electricity, gas and other fuels category declined to 3.9 percent year-on-year in August, from 4.2 percent in July.
By contrast, the slowdown in price growth was not accompanied by a similar contraction in rental activity across the Kingdom. The number of rental transactions rose to about 446,300 in August, compared with 325,200 in the same month of 2025, an annual increase of 37 percent.
The value of rental transactions also increased by 32 percent to 10.62 billion riyals ($2.83 billion), compared with about 8.03 billion riyals a year earlier. The residential sector accounted for about 343,700 transactions, an increase of 36 percent, while the value of its transactions rose 28 percent to 5.59 billion riyals.
Although these figures reflect the performance of Saudi Arabia’s rental market as a whole and do not separately measure the impact of the measures implemented in Riyadh, they indicate that slower rent growth has not, so far, been accompanied by a broad contraction in rental activity.
Balance or a Transitional Phase?
A year after the regulations were implemented, the picture raises the question of whether the current indicators represent the beginning of a sustainable equilibrium in Riyadh’s rental market, or whether they reflect a transitional phase during which the market is reshaping price levels, returns, and the behavior of tenants and investors. According to real estate specialists, determining the direction of this trend will depend on developments in new supply, development and financing costs, and households’ ability to afford housing in the coming period.
Real estate expert and commentator Abdullah Al-Mousa told Asharq Al-Awsat that the current indicators reflect a tangible impact from the latest regulatory measures on Riyadh’s rental market, particularly the freeze on annual increases. He noted that slower rent growth and the decline in the burden of rent on household income reflect an easing of some of the price pressures that the capital has experienced in recent years.
He explained that this improvement cannot be attributed solely to the freeze on increases, but comes within a comprehensive package of measures that included regulating the relationship between landlords and tenants, fixing rents under specific regulations, increasing the supply of land, developing the white land fee system, and strengthening documentation and transparency in the market.
Al-Mousa said it was too early to consider the rental market to have reached “full equilibrium,” saying that what is currently taking place is closer to a transition from a period of rapidly rising prices toward stability, repricing and testing new levels of equilibrium.
He added that sustainable equilibrium is not measured by slower prices alone, but by the market’s ability to provide sufficient supply, maintain affordable housing costs relative to household income, and keep occupancy rates stable while ensuring that investment in the rental sector remains attractive.
Regarding the impact of the regulations on the behavior of landlords and tenants, Al-Mousa noted that their effect may be behavioral and contractual as much as it is related to prices. They give tenants greater ability to anticipate their future obligations and limit sudden increases, which could encourage them to remain in a unit for longer periods.
At the same time, the regulations may encourage landlords to place greater priority on tenant stability and regular payment rather than relying on raising rents at every renewal.
He noted that the regulations have also reshaped the way units are priced and negotiated, particularly for properties entering the market for the first time, where the initial rent becomes more important in determining the subsequent course of the contract. This is prompting owners and developers to study pricing more carefully and link it to the unit’s location, quality, level of services and the value it provides to the tenant.
Al-Mousa considered that this shift could, over the long term, move competition in the rental market away from focusing on raising prices and toward improving the quality of real estate products and retaining tenants for longer periods. This would reflect a market moving toward greater competition over value and stability, rather than price alone.
Reshaping Investment Economics
Real estate expert and marketer Saqr Al-Zahrani told Asharq Al-Awsat that rental regulations are likely to reshape the economics of investment in the residential sector, rather than simply limiting investment activity. He explained that limited growth in rental revenues, alongside rising land, financing and construction costs, will push investors to scrutinize target returns more closely and focus on assets capable of generating stable cash flows and achieving greater operational efficiency.
He added that the next phase could see a greater shift by institutional investors toward towers and integrated, professionally managed residential complexes, benefiting from economies of scale in reducing operating costs, improving occupancy efficiency, and diversifying products and services. At the same time, standalone residential units may become less attractive as rental assets, as a larger share of them shifts toward ownership by end users.
According to Al-Zahrani, demand for housing in Riyadh will not necessarily decline, but it may become more selective, with tenants paying greater attention to balancing price, location, space, product quality and services. Landlords, meanwhile, will rely more heavily on asset quality and sustainable occupancy rather than relying solely on rent growth.
He noted that among the key indicators that should be monitored over the next two years are rent growth rates, the volume of new supply, occupancy and vacancy rates, net investment returns, the movement of households from renting to homeownership, the length of time units remain on the market, and the ratio of housing costs to household income.
Al-Zahrani said one of the most significant potential shifts is the movement of some investment away from individual residential units toward integrated residential assets, particularly as projects capable of relying on actual local demand and generating stable cash flows become increasingly important.
At the same time, he warned that continued increases in development costs, combined with limited rent growth, could prompt some investors to reduce the supply allocated for rental or redirect capital toward homeownership projects.
Conversely, improved homeownership affordability could gradually encourage some tenants to shift from bearing rental costs toward building homeownership, potentially reshaping the pattern of demand in the capital’s housing market.
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