The Middle East’s hotel construction pipeline reached a new all-time high in the second quarter of 2026, with 724 projects comprising 178,003 rooms, according to the latest Construction Pipeline Trend Report from Lodging Econometrics (LE).

The total represents an increase of 11% in projects and 10% in rooms year-on-year, reflecting continued investment in hospitality development across the region.

Saudi Arabia remains the dominant market, accounting for more than half of all projects in the regional pipeline, while Egypt recorded particularly strong growth and reached a new development record.
Projects in Planning Rise Sharply

At the end of Q2 2026, 330 projects with 82,353 rooms were under construction, representing 46% of the overall pipeline by both project and room count.

Another 173 projects comprising 52,678 rooms are scheduled to begin construction within the next 12 months, representing year-on-year increases of 18% and 16%, respectively.

Early planning reached a record 221 projects and 42,972 rooms, rising 33% by projects and 45% by rooms compared with the same period last year.

Luxury development continues to feature prominently. The luxury segment reached an all-time high of 207 projects with 45,446 rooms, while upper upscale projects climbed to a record 178 projects and 43,896 rooms. The upscale segment accounted for another 184 projects and 52,621 rooms.

Luxury and upscale hotels together represent 54% of all projects and 55% of rooms in the Middle East pipeline.

Renovations and brand conversions are also increasing rapidly. Combined activity reached a record 101 projects and 29,658 rooms, with brand conversions alone accounting for 88 projects and 24,466 rooms.
Saudi Arabia Leads Regional Development

Saudi Arabia leads the Middle East hotel pipeline with 387 projects and 105,648 rooms, representing year-on-year increases of 13% and 15%, respectively.

Egypt ranks second and reached a new record of 167 projects and 35,185 rooms, up 31% by projects and 25% by rooms.

The UAE follows with 103 projects and 24,985 rooms, while Oman has 27 projects comprising 4,624 rooms and Iraq has 10 projects with 2,331 rooms.

Together, these five markets account for 96% of projects and 97% of rooms in the Middle East construction pipeline.

At city level, Riyadh leads with 106 projects and a record 21,666 rooms, followed by Cairo with 63 projects and 12,618 rooms. Jeddah has 62 projects and 14,435 rooms, Dubai 60 projects and 13,828 rooms, while Makkah has 34 projects comprising 21,689 rooms.
102 New Hotels Forecast for 2028

The region opened 22 hotels comprising 3,981 rooms during the first half of 2026. LE expects another 61 hotels and 11,168 rooms to open during the second half, taking the full-year forecast to 83 hotels and 15,149 rooms.

Another 91 hotels with 22,875 rooms are forecast to open in 2027.

In its first forecast for 2028, Lodging Econometrics expects 102 new hotels comprising 24,284 rooms to open across the Middle East, pointing to sustained development activity over the coming years.

Source: Hospitality Net / Lodging Econometrics