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Details of Saudi vision taking shape

The Kingdom of Saudi Arabia’s Vision 2030 plan includes the US$20 billion Diriyah Gate Development Authority (DGDA), which will transform the nation’s original capital of Diriyah, a city within Riyadh province that is expected to house 100,000 residents and attract 25 million annual visitors.

“Everybody has started building with a number of hotels under construction. The Nobu hotel just opened here. Two Amans have been announced, and I’ve already broken ground on two hotels. They'll be ready by 2022.” – Jerry Inzerillo
“Everybody has started building with a number of hotels under construction. The Nobu hotel just opened here. Two Amans have been announced, and I’ve already broken ground on two hotels. They’ll be ready by 2022.” – Jerry Inzerillo

Consummate global hotelier Jerry Inzerillo is the CEO of DGDA and responsible for creating, among other things, 20 hotel projects over the next 5 to 10 years. Most of those deals, he said, should be completed in the next six months with development plans in place by late next year.

“Some of them will already be in the ground, if they’re simple, smaller hotels. We have a number of them that are 60-, 80-room boutique hotels, while some of the big sprawling resorts like Aman will take a little bit longer,” he said. A Greg Norman-designed golf course is under construction and product should start coming online in Diriyah by 2022. He expects to have a few thousand keys online by the end of 2023. In total, the project should include some 4,000-plus keys.

There will be three layers of ownership. DGDA will own and manage itself as there are certain hotels where it wants complete control of standards. It currently has a 147-room hotel under construction across from the UNESCO site and might manage that one. A pool of about four dozen Saudi conglomerates want to own hotels and more and will seek brand managers to operate. And there will be foreign investors – many from Gulf states – who want to expand their base and perhaps bring their own management.

There has also been interest from Asian investors, according to Inzerillo. “We think the first year, we’ll probably put up about 80% of the money and then that will gradually go down. We also anticipate that by 2023 that DGDA will move out of its development profile. We intend to have almost everybody outside operate, but we will operate all 12 museums with ministry of culture.”

Hotel development rendering at Diriyah
Hotel development rendering at Diriyah

There are also three timetables. The global launch of the new Saudi image campaign was set for March but was interrupted by COVID-19. This fall, and certainly after the G20 in November, all of those marketing initiatives are expected to kick back into full gear.

“Everybody has started building with a number of hotels under construction,” Inzerillo said. “The Nobu hotel just opened here. Two Amans have been announced, and I’ve already broken ground on two hotels. They’ll be ready by 2022.”

There is also firm interest from some 36 major global luxury hotel chains, and post-COVID DGDA will likely take equity positions in those developments, according to Inzerillo. “With board approval we now also will have a mechanism that we will pay all the money to get the hotel built. But within the window of time, it could be a three- to five-year period, the hotel company or the owner will have the option to take out DGDA’s equity as a bridge equity.” This will help meet goals of bringing 100,000 rooms online across the country over the next five years.

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