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Pilgrims boost luxury tourism

The luxury travel business has tapped a new market: the pilgrimage to Mecca. Before air transport, the journey to the holy shrine was associated with peril and privations.

In recent decades it has become a big business, not just through increased air travel by pilgrims, but now with progressively more luxurious hotels for well-to-do pilgrims.

Saudi Arabia is expanding its portfolio of hospitality and tourism facilities to meet growing demand from the religious tourism sector, with an investment of 1.25 billion Saudi riyals (Dh1.22bn) from the Saudi Economic and Development Company (SEDCO) .

Elaf Group , a subsidiary of SEDCO , said it was launching five hotels in Jeddah, Mecca and Medina, in response to a 30 per cent increase in religious tourism in the first quarter of the year. Jeddah is used as a gateway city to the holy cities of Mecca and Medina.

The company said that Saudi Arabia was expected to generate a total of 13bn riyals during the current umrah pilgrimage season, from a predicted 3.5 million pilgrims.

Tarek Nabulsi, the deputy chief executive of Elaf, said: "Global travel has become more affordable now, with several special discounts, promotional activities and highly competitive airline prices, which have all contributed to the significant increase in the number of umrah pilgrims and the strong growth of the Saudi tourist market."

Mecca and Jeddah were among the top performing hotel markets in the Middle East in terms of revenue per available room (RevPAR) growth in the first quarter of this year, with RevPAR up 32.7 per cent and 30.3 per cent respectively compared with the same period last year, according to Deloitte.

Chiheb Ben-Mahmoud, a senior vice president at Jones Lang LaSalle Hotels, said: "There is a strategy of the Saudi authorities to upgrade and increase the capacity of accommodation and related services for haj and umrah visitors, creating a lot of new projects and opportunities."

Mr Ben-Mahmoud said that Saudi Arabia had relaxed visa restrictions for the umrah season, allowing visitors to stay in the country for longer.

A report from Jones Lang LaSalle Hotels recently said haj and umrah pilgrims made up more than 50 per cent of the total visitors to the kingdom. Among recent developments in the Saudi luxury hotel sector, Raffles Hotels and Resorts announced last month that it would manage a new hotel in Mecca, Raffles Makkah Palace, due to open this November, which would be located three minutes from the Grand Mosque that encircles the Holy Kaaba.

The Rezidor Hotel Group announced last week that its Al Muna Karim Radisson Blu Hotel in Medina would open in the third quarter of this year in time for Ramadan, while Hyatt Hotels and Resorts opened its first hotel in Saudi Arabia, the Park Hyatt Jeddah. Religious tourism in Saudi Arabia generates about US$7bn (Dh25.69bn) a year, it was estimated recently, while the country's government has allocated a total of $38bn towards improving tourism infrastructure and transport systems, including a high-speed railway system that will link Jeddah, Mecca and Medina, Elaf said.

The Saudi Commission for Tourism and Antiquities expects visitor numbers to the kingdom to nearly double from 47 million last year to 88 million by 2020, and the number of hotel rooms to rise from 117,097 to 254,310.

The religious tourism market is worth an estimated $18bn a year, according to the World Religious Travel Association (WRTA). Last month, Kevin Wright of the WRTA, commenting on Saudi Arabia at the Arabian Travel Market, said: "Tour operators, hotels and airlines are already tailoring products to tap into the religious market." Mr Wright also identified Jordan and Palestine as growth markets.

"Ninety-five per cent of tourism in Palestine is religion-based, while Jordan is targeting tourism revenues of up to $2.4 billion a year by 2010, over 60 per cent higher than income generated in 2007," he said. Iraq was also emerging as a key market for religious tourism, he said.

By Rebecca Bundhun

© The National 2009