MENA Hospitality Market Set for Explosive Growth, Fuelled by Mega-Projects and Tourism Boom

The Middle East and North Africa (MENA) region is on the cusp of a remarkable expansion in its hospitality sector, with the market value expected to surge from US\$310 billion in 2025 to over US\$487 billion by 2032. This projection, unveiled ahead of the Future Hospitality Summit – FHS World scheduled for late October in Dubai, highlights the region’s accelerating momentum as a global tourism and investment hotspot.

Tourism’s economic footprint in the Middle East is substantial and growing. The World Travel and Tourism Council (WTTC) estimates that in 2025, the sector will contribute approximately US\$367 billion to the regional economy, supporting around 7.7 million jobs. This represents a significant increase from previous years, reflecting a robust recovery and expansion post-pandemic. International visitor spending is forecast to reach nearly US\$194 billion, marking a nearly 25% rise compared to 2019 levels, while domestic tourism is expected to generate about US\$113 billion in spending.

The region’s hotel construction pipeline is at an unprecedented scale, with 650 projects encompassing over 161,500 rooms as of the second quarter of 2025. Of these, 337 projects with nearly 86,500 rooms are actively under construction, and an additional 147 projects are slated to commence within the next year. This surge in development underscores the confidence investors and governments have in the sector’s future.

Saudi Arabia leads the charge in hotel development, boasting more than 92,000 rooms across 342 projects. The Kingdom’s ambitious Vision 2030 plan aims to attract 150 million tourists annually by 2030, with tourism targeted to contribute 10% of GDP. Mega-projects such as NEOM, The Red Sea Project, and AlUla are central to this vision, combining luxury hospitality with cultural and ecological preservation.

Egypt follows as a key player, with 127 hotel projects and over 28,000 rooms in the pipeline. The country targets 30 million international visitors by 2028 and aims for tourism to account for 15% of its GDP. Egypt’s development focus includes the New Administrative Capital and coastal resorts like Ras Al Hekma and the Red Sea, positioning it as a major regional tourism hub.

The United Arab Emirates (UAE) ranks third, with 100 projects and approximately 25,470 rooms in development, primarily concentrated in Dubai. The emirate continues to set industry benchmarks, with hotel occupancy rates reaching 81% in the first half of 2025 and an average daily rate (ADR) climbing to US\$159. Dubai’s hospitality sector remains a magnet for international visitors and investors alike, supported by ongoing infrastructure upgrades and a diverse portfolio of luxury and lifestyle offerings.

Other notable markets include Oman, which is rapidly emerging as a hospitality investment hotspot. Tourism is projected to contribute 5% to Oman’s GDP by 2030 and 10% by 2040, with plans to increase hotel room inventory by 25% within the next five years. In the first half of 2025 alone, Oman welcomed over 1.1 million guests to its 3- to 5-star hotels, generating revenues exceeding US\$367 million and driving employment growth in the sector.

Qatar also plays a strategic role, with a hotel pipeline of nearly 3,500 rooms across 16 projects, gearing up for global events like the FIFA World Cup 2034, which is expected to further stimulate demand and investment.

The region’s hospitality boom is underpinned by a combination of factors: visionary government initiatives, mega-projects, and a strategic focus on diversifying economies through tourism. Saudi Arabia and Egypt’s aggressive visitor targets are complemented by the UAE’s established global appeal and Oman’s emerging market potential. These dynamics are attracting a broad spectrum of investors, from high-net-worth individuals to institutional players, all seeking to capitalize on the region’s high-yield, income-generating hotel assets and mixed-use developments.

Liquidity in the hotel investment market remains strong, supported by resilient trading performance and rising tourist arrivals. Industry experts note that Dubai alone is on track to surpass US\$1.2 billion in hotel transactions this year, reflecting sustained investor confidence. The hospitality sector’s operational strength is evident in rising occupancy and ADR metrics, which continue to set new benchmarks for safety, inclusivity, and connectivity.

Looking ahead, the Middle East’s hospitality landscape is poised for continued transformation. Upcoming global events such as Expo 2030 in Saudi Arabia and the FIFA World Cup 2034 in Qatar are expected to further boost demand for hotel rooms and related infrastructure. Additionally, regulatory reforms—such as allowing foreigners to purchase real estate in designated zones in Saudi Arabia starting January 2026—are set to deepen investor appetite and broaden market participation.

For African tourism stakeholders, the MENA region’s rapid hospitality growth offers valuable insights and potential partnership opportunities. The scale of investment, diversity of projects, and strategic government backing provide a blueprint for leveraging tourism as a driver of economic diversification and job creation. As Africa’s own tourism markets evolve, collaboration with MENA investors and operators could accelerate infrastructure development, enhance service standards, and expand cross-regional travel flows.

In sum, the MENA hospitality sector’s trajectory is one of dynamic growth and diversification, anchored by visionary projects and robust market fundamentals. This momentum not only reinforces the region’s status as a premier global destination but also signals exciting opportunities for investors, developers, and tourism professionals across Africa and beyond.