Abdullah bin Mohammed Al-Issa, chairman of Dur Hospitality Company, left, and IHG’s Pascal Gauvin cut the cake to mark the beginning of new cooperation in Riyadh on Sunday.

Three hundred Saudi youth are to be employed in the hospitality sector under a new franchise system agreed between two of the industry’s biggest players.

Addressing a press conference in Riyadh on Sunday, Abdullah bin Mohammed Al-Issa, chairman of Dur Hospitality Company, said the cooperation between his company and the Inter Continental Hotels Group (IHG) would create 300 new positions for the locals.

Al-Issa spoke to the press on Sunday following the signing of a formal agreement between his company and the IHG for the franchising of Holiday Inn and its suites throughout the Kingdom. Under the new franchise plan, signatories expect to enhance the brand’s footprint in the Kingdom by developing a number of Holiday Inn & Suites branded hotels across the country in the course of the next five years.

“This new franchise will definitely strengthen Dur’s financial position and its investment’s leadership in the hospitality sector based on the upcoming investments in a number of new hotels in several cities in the Kingdom. We have seen the success IHG has had in KSA and their competition capabilities to have a noticeable market share, and these are the main reasons that led to our partnership”, declared Al-Issa.

The growth of tourism in the country and the increase in demand for hotel rooms and hospitality services have led to the rise in investments in this sector, as expectations for further growth will exceed SR95 billion within the next 10 years. “However, and as we announced previously, Dur Hospitality will invest more than SR1.5 billion in the development of new projects in the upcoming five years,” he added.

Badr bin Hmoud Al-Badr, CEO of Dur Hospitality, expressed his optimism toward the constant growth in the hotel sector due to the increasing number of foreign businessmen who visit KSA or those who are moving within the cities. Another main reason, Al-Badr explained, is the tremendous growth in the religious tourism sector.

However, Al-Badr recalled the statistics and reports that indicated that more than 350,000 new hotel rooms will be available in Saudi Arabia by the end of 2015 after the implementation of a large number of hotel projects that are currently being developed in several areas.

On the issue of the causes of the continuous growth and demand in hotel sector, Al-Bader explained that the government’s direction to diversify the sources of national income from oil was a key motivation for the overall economic development taking place in Saudi Arabia. This development can be seen through the growth of several sectors such as industry, commerce, education, services, transportation and others, including the tourism sector, especially in light of the current gigantic projects that are designed to enlarge infrastructure in all regions.

Pascal Gauvin, IHG’s chief operating officer for India, Middle East and Africa, declared that Saudi Arabia is a main player in the regional hospitality sector. “We have been operating in Saudi Arabia for the last 40 years and this represents a key market for us as it holds our largest pipeline in the Middle East.”

[wpResize]