The Q1 2025 Hotel Construction Pipeline Trend Report from Lodging Econometrics shows an 8% year-on-year increase in Middle Eastern hotel construction projects, with 634 projects encompassing 158,656 rooms.
Key Findings
At the close of Q1 2025, projects under construction were 327, accounting for 84,434 rooms, marking an 8% increase by projects and 5% by rooms, year-over-year. Projects scheduled for initiation within the next 12 months numbered 158, with a total of 47,201 rooms, representing a 19% increase in projects and a 55% increase in rooms, year-over-year.
New projects announced at the close of the first quarter included 41 projects and 9,068 rooms, while new construction starts stood at 39 projects or 6,910 rooms, up 63% by projects and 21% by rooms, year-over-year.
Record Highs in Luxury and Upscale Sectors
The luxury chain scale reached record highs in Q1 2025, boasting 185 projects and 42,268 rooms, while the upper upscale chain scale also reached record highs with 153 projects and 37,946 rooms. These two sectors combined account for over half of all projects and rooms in the region’s pipeline. Brand conversions also reached record totals, with 55 projects and 12,436 rooms.
Leading Countries and Cities
The countries with the most significant number of projects were Saudi Arabia, with 319 projects or 85,416 rooms, and Egypt, with 125 projects or 28,768 rooms. The United Arab Emirates was next with 102 projects or 27,279 rooms, followed by Oman and Qatar.
The cities with the largest pipelines were Riyadh, Dubai, Jeddah, Cairo, and Makkah, hosting 94% of the projects and 95% of the rooms in the region’s total construction pipeline.
Hotel Openings
In the first quarter, 9 new hotels opened in the Middle East, providing an additional 2,130 rooms. By the end of 2025, Lodging Econometrics predicts 108 new hotels, or 25,635 rooms, will open. By the end of 2026, 109 new hotels or 20,806 rooms are expected to open.
