Tourist expenditure in Saudi Arabia reaches SAR82.7 billion as guest numbers grow to 37.2 million in the first quarter | News

Tourist spending in Saudi Arabia reached SAR82.7 billion in the first quarter of 2026, with visitor numbers growing 8% this quarter to 37.2 million, says Cavendish Maxwell, leading real estate and hospitality consultancy.

Between January and March, the number of domestic tourists rose by 16% to almost 29 million, accounting for 78% of all visitors, while inbound visitor figures fell by 13% to 8.3 million, according to Cavendish Maxwell’s latest insight into the hospitality sector.

While foreign visitors made up only a fifth of all tourists in the first quarter, they generated almost 60% of tourism expenditure: SAR48 billion compared to SAR34.7 billion from the domestic market, highlighting the significant purchasing power of inbound travelers. Moreover, although the number of foreign visitors in the first quarter was 13% lower than last year, their total expenditure fell by only 7%, indicating that average expenditure per visitor increased year-on-year.

The research, released to coincide with the Future Hospitality Summit Saudi Arabia, currently taking place in Riyadh, shows that after an initial occupancy rate of almost 75% in January, the rate has fallen to 63% so far in May – a decline of 1.3% from the previous year.

Occupancy rates were higher at hotels in Mecca, at almost 84% in January and just under 73% since the start of the year in May, an increase of 12% compared to the same period last year. In Medina it reached almost 85% in January, with a cumulative rate of 76% in May – a decrease of 3% from 2025.

Nationally, the average daily rate (ADR) in January was SAR662, almost 5% higher than in January 2025. In May so far it was SAR825, 12% higher than last year. ADR varied widely at the city level in the first five months of 2026, with some areas higher than last year, and others lower. So far in May, Makkah ADR grew 24% to SAR918, while Medina rose 5.7% to SAR878. The ADR of hotels in Riyadh amounted to SAR771, approximately 6% lower than last year; while Jeddah fell 7% to SAR635.

Kevin Duffield, director of Built Asset Consulting at Cavendish Maxwell, said: “Religious tourism is a key demand driver for Saudi Arabia, with Mecca and Medina continuing to outperform other destinations. The positive impact of the Hajj season is clearly visible in the higher occupancy and ADR levels in Mecca in May. When the June figures are available, we expect to see strong figures for Medina, where many pilgrims travel after the Hajj. In the meantime, continued investment is being made in The pilgrimage infrastructure, combined with significant hotel expansion, should support long-term growth in both cities.”

KSA currently has a total of just over 176,000 hotel rooms, of which 64,330 are in Mecca; 28,000 in Riyadh; 22,115 in Medina; 16,080 in Jeddah; 8,580 in Al Khobar 4,465 in Dammam; and 32,440 elsewhere in the country. The more expensive hotels account for two-thirds of accommodations nationwide, and a whopping 73% in Riyadh and 70% in Medina.

Saudi Arabia will provide 105,500 new keys to 382 hotels between now and 2030 as part of the transformation of tourism, hospitality, real estate and infrastructure in line with the KSA Vision 2030. Nearly 18,150 rooms (82 hotels) will come to the market this year, with Makkah and Medina accounting for approximately 40% of new keys by 2026. This year, Riyadh will release more than 40% of the new keys. 2,780 new keys (15 hotels), Jeddah almost 2,750 keys (18 hotels) and Al Khobar 760 rooms spread over 5 hotels. The remaining 5,000 new rooms for 2026 are spread across other parts of the country.

Meanwhile, Dammam, an emerging real estate and tourism hotspot in KSA, will increase its hotel offering from next year, with more than 1,900 rooms across six hotels to be delivered between 2027 and 2029.

Saudi Arabia is targeting 150 million annual domestic and international visitors by 2030, with major upcoming global events set to further strengthen the country’s tourism and hospitality industry. The Riyadh Expo 2030 and the 2034 FIFA World Cup are expected to attract a total of more than 42 million visitors.

Kevin Duffield added: “As the Middle East’s largest travel and tourism economy – and fastest growing tourism market – Saudi Arabia provides a wealth of leading destinations, hotels and resorts to help achieve Vision 2030.

“As elsewhere in the region, KSA’s hospitality and tourism sectors have been hit by geopolitical tensions, but the reduction in inbound tourism has been largely offset by an increase in domestic travel, especially to destinations such as Mecca and Medina during Ramadan, Eid and Hajj.

“While uncertainty and lower international travel demand may continue to impact market performance in the short term, the combination of growing domestic tourism, continued pilgrimage activity and continued investment in tourism infrastructure positions the sector well for longer-term recovery and development.”