Professional Documents
Culture Documents
2012 September
Prepared by
Economic Planning Department
Royal Commission at Yanbu
Yanbu Al-Sinaiyah, Kingdom of Saudi Arabia
Page 1
Introduction
Investors in the Yanbu Waterfront are being offered a unique opportunity to invest in a once in
lifetime world class resort on the spectacular Red Sea coast of Saudi Arabia. In order to assist
investors considering these opportunities, a preliminary financial feasibility study has been prepared
for the hotel component of this investment opportunity.
The projections in this preliminary study reflect reasonable assumptions prepared by the Royal
Commission at Yanbu based on independent analysis prepared by the international firm Albert Speer
& Partners (AS&P), as well as published market and financial conditions in Yanbu Al-Sinaiyah and the
Kingdom of Saudi Arabia. This preliminary study is intended to serve investors as a basis for a more
detailed analysis and by providing reasonable projections for the investors independent analysis.
Executive Summary
This preliminary financial feasibility study is presented in five sections. The results of this study
conclude that a 3* waterfront hotel in Yanbu Al-Sinaiyah with 250 rooms is a profitable financial
investment. Furthermore:
It is estimated that the hotel construction will cost a total of approximately SR 74 million.
The hotels occupancy is projected to range 64% in year 1 to 70% in the 5th year of operation.
The Internal Rate of Return (IRR) is estimated to average 18.6% during the first 5 years of
operation.
This study is presented in five sections:
1. Hotel Development Costs
2. Hotel Operational Costs
3. Projected Hotel Occupancy
4. Hotel Revenues and Net Operating Income
5. Projected Internal Rate of Return (IRR).
Page 2
Page 3
purposes of this preliminary feasibility study, a mid-point between the Kingdoms 2011 average hotel
occupancy rate and the Yanbu Waterfront Master Plan was used ranging from 64% in year 1 to 70%
in the 5th year of operation.
75%
70%
65%
64%
60%
66%
67%
68%
Year 2
Year 3
Year 4
70%
63%
55%
50%
Year 1
Year 5
Hotel Name
Location
Movenpick
Radisson Blu
Radhwa Holiday Inn
Yanbu Al-Sinaiyah
Yanbu Al-Bahr
Yanbu Al-Bahr
Waterfront Site
Hotel
Rating
Yes
Yes (limited)
No
4*
3*
3*
SR 825 SR 900
SR 546 SR 600
SR 793 SR 936
SR 765
Source: Hotels.com.
For purposes of this preliminary feasibility study, an average room rate of SR600 per night is
conservatively projected for the 1st year and is projected to increase to an average of SR675 per night
in the 5th year of operation. Revenues from operation of other hotel services will also be generated
from hotel guests. Additional revenues are projected to average SR150 per room in the first year of
operation increasing to SR170 per room by the 5th year of operation.
Page 4
Table II
Summary of Hotel Annual Revenues and Expenses Years 1 5
Average
Year of
Nightly
Operation Room
Rate
Other
Total
Average
Total
Revenue Revenue Occupancy Revenues
per Room per Room Rate
(SR)
Total
Operating
Expenses
(SR)
NET
OPERATING
INCOME (SR)
Year 1
SR600
SR150
SR750
64%
43,800,000
31,974,000
11,826,000
Year 2
SR620
SR155
SR775
66%
46,749,656
33,659,753
13,089,904
Year 3
SR638
SR162
SR800
67%
48,833,578
35,160,176
13,673,402
Year 4
SR655
SR165
SR820
68%
50,958,563
36,180,579
14,777,983
Year 5
SR675
SR170
SR845
70%
53,894,531
38,265,117
15,629,414
Internal Rate of
Return
43,800,000
11,826,000
27%
46,749,656
13,089,904
28%
48,833,578
13,673,402
28%
50,958,563
14,777,983
29%
53,894,531
15,629,414
29%
16.0%
17.7%
18.5%
20.0%
21.1%
28%
18.6%
In conclusion, based on these preliminary projections, a 250 room 3* hotel located along the
waterfront in Yanbu Al-Sinaiyah will be a profitable financial investment.
Yanbu Waterfront 250 Room Hotel Preliminary Financial Feasibility Study
Page 5
Note: The financial projections used in this study should be viewed as approximations. These
projections assume that the hotel will be professionally marketed, managed and maintained
under international hospitality standards and the hotel will be built using quality design,
construction practices and materials.
Each hotel investor may undertake their own study based on their experience in the hotel
industry. The Royal Commission at Yanbu Economic Planning Department is available to
discuss this preliminary study, the data and assumptions incorporated in this document. For a
confidential meeting, contact the Economic Planning Department.
Office:
Mobile:
Fax:
(04) 321-6267
(055) 600-7113
(04) 321-6343
Page 6
2012 September
Prepared by
Economic Planning Department
Royal Commission at Yanbu
Yanbu Al-Sinaiyah, Kingdom of Saudi Arabia
Page 1
Introduction
Investors in the Yanbu Waterfront are being offered a unique opportunity to invest in a once in
lifetime world class resort on the spectacular Red Sea coast of Saudi Arabia. In order to assist
investors considering these opportunities, a preliminary financial feasibility study has been prepared
for the hotel component of this investment opportunity.
The projections in this preliminary study reflect reasonable assumptions prepared by the Royal
Commission at Yanbu based on independent analysis prepared by the international firm Albert Speer
& Partners (AS&P), as well as published market and financial conditions in Yanbu Al-Sinaiyah and the
Kingdom of Saudi Arabia. This preliminary study is intended to serve investors as a basis for a more
detailed analysis and by providing reasonable projections for the investors independent analysis.
Executive Summary
This preliminary financial feasibility study is presented in five sections. The results of this study
conclude that a 3* waterfront hotel in Yanbu Al-Sinaiyah with 200 rooms is a profitable financial
investment. Furthermore:
It is estimated that the hotel construction will cost a total of approximately SR 70.5 million.
The hotels occupancy is projected to range 64% in year 1 to 70% in the 5th year of operation.
The Internal Rate of Return (IRR) is estimated to average 17.3% during the first 5 years of
operation.
This study is presented in five sections:
1. Hotel Development Costs
2. Hotel Operational Costs
3. Projected Hotel Occupancy
4. Hotel Revenues and Net Operating Income
5. Projected Internal Rate of Return (IRR).
Page 2
Page 3
The Yanbu Waterfront Master Plan consultant AS&P projected hotel occupancy in the first year of
operation of Yanbus waterfront hotels to be 65% and reach 72% by the 5th year of operation. For
purposes of this preliminary feasibility study, a mid-point between the Kingdoms 2011 average hotel
occupancy rate and the Yanbu Waterfront Master Plan was used ranging from 64% in year 1 to 70%
in the 5th year of operation.
75%
70%
65%
64%
60%
66%
67%
68%
Year 2
Year 3
Year 4
70%
63%
55%
50%
Year 1
Year 5
Hotel Name
Location
Movenpick
Radisson Blu
Radhwa Holiday Inn
Yanbu Al-Sinaiyah
Yanbu Al-Bahr
Yanbu Al-Bahr
Waterfront Site
Hotel
Rating
Yes
Yes (limited)
No
4*
3*
3*
SR 825 SR 900
SR 546 SR 600
SR 793 SR 936
SR 765
Source: Hotels.com.
For purposes of this preliminary feasibility study, an average room rate of SR600 per night is
conservatively projected for the 1st year and is projected to increase to an average of SR675 per night
in the 5th year of operation. Revenues from operation of other hotel services will also be generated
Page 4
from hotel guests. Additional revenues are projected to average SR150 per room in the first year of
operation increasing to SR170 per room by the 5th year of operation.
Table II
Summary of Hotel Annual Revenues and Expenses Years 1 5
Average
Year of
Nightly
Operation Room
Rate
Other
Total
Average
Total
Revenue Revenue Occupancy Revenues
per Room per Room Rate
(SR)
Total
Operating
Expenses
(SR)
NET
OPERATING
INCOME (SR)
Year 1
SR600
SR150
SR750
64%
46,428,000
33,892,440
12,535,560
Year 2
SR620
SR155
SR775
66%
49,324,275
35,513,478
13,810,797
Year 3
SR638
SR162
SR800
67%
51,355,500
36,975,960
14,379,540
Year 4
SR655
SR165
SR820
68%
53,983,500
38,328,285
15,655,215
Year 5
SR675
SR170
SR845
70%
57,487,500
40,816,125
16,671,375
Internal Rate of
Return
46,428,000
12,535,560
27%
49,324,275
13,810,797
28%
51,355,500
14,379,540
28%
53,983,500
15,655,215
29%
57,487,500
16,671,375
29%
14.8%
16.3%
17.1%
18.6%
19.7%
28%
17.3%
Page 5
In conclusion, based on these preliminary projections, a 200 room 3* hotel located along the
waterfront in Yanbu Al-Sinaiyah will be a profitable financial investment.
Note: The financial projections used in this study should be viewed as approximations. These
projections assume that the hotel will be professionally marketed, managed and maintained
under international hospitality standards and the hotel will be built using quality design,
construction practices and materials.
Each hotel investor may undertake their own study based on their experience in the hotel
industry. The Royal Commission at Yanbu Economic Planning Department is available to
discuss this preliminary study, the data and assumptions incorporated in this document. For a
confidential meeting, contact the Economic Planning Department.
Office:
Mobile:
Fax:
(04) 321-6267
(055) 600-7113
(04) 321-6343
Page 6
2012 September
Prepared by
Economic Planning Department
Royal Commission at Yanbu
Yanbu Al-Sinaiyah, Kingdom of Saudi Arabia
Page 1
Introduction
Investors in the Yanbu Waterfront are being offered a unique opportunity to invest in a once in
lifetime world class resort on the spectacular Red Sea coast of Saudi Arabia. In order to assist
investors considering these opportunities, a preliminary financial feasibility study has been prepared
for the hotel component of this investment opportunity.
The projections in this preliminary study reflect reasonable assumptions prepared by the Royal
Commission at Yanbu based on independent analysis prepared by the international firm Albert Speer
& Partners (AS&P), as well as published market and financial conditions in Yanbu Al-Sinaiyah and the
Kingdom of Saudi Arabia. This preliminary study is intended to serve investors as a basis for a more
detailed analysis and by providing reasonable projections for the investors independent analysis.
Executive Summary
This preliminary financial feasibility study is presented in five sections. The results of this study
conclude that a 3* waterfront hotel in Yanbu Al-Sinaiyah with 200 rooms is a profitable financial
investment. Furthermore:
It is estimated that the hotel construction will cost a total of approximately SR 95 million.
The hotels occupancy is projected to range 64% in year 1 to 70% in the 5th year of operation.
The Internal Rate of Return (IRR) is estimated to average 15.1% during the first 5 years of
operation.
This study is presented in five sections:
1. Hotel Development Costs
2. Hotel Operational Costs
3. Projected Hotel Occupancy
4. Hotel Revenues and Net Operating Income
5. Projected Internal Rate of Return (IRR).
Page 2
Page 3
purposes of this preliminary feasibility study, a mid-point between the Kingdoms 2011 average hotel
occupancy rate and the Yanbu Waterfront Master Plan was used ranging from 64% in year 1 to 70%
in the 5th year of operation.
75%
70%
65%
64%
60%
66%
67%
68%
Year 2
Year 3
Year 4
70%
63%
55%
50%
Year 1
Year 5
Hotel Name
Location
Movenpick
Radisson Blu
Radhwa Holiday Inn
Yanbu Al-Sinaiyah
Yanbu Al-Bahr
Yanbu Al-Bahr
Waterfront Site
Hotel
Rating
Yes
Yes (limited)
No
4*
3*
3*
SR 825 SR 900
SR 546 SR 600
SR 793 SR 936
SR 765
Source: Hotels.com.
For purposes of this preliminary feasibility study, an average room rate of SR600 per night is
conservatively projected for the 1st year and is projected to increase to an average of SR675 per night
in the 5th year of operation. Revenues from operation of other hotel services will also be generated
from hotel guests. Additional revenues are projected to average SR150 per room in the first year of
operation increasing to SR170 per room by the 5th year of operation.
Page 4
Table II
Summary of Hotel Annual Revenues and Expenses Years 1 5
Average
Year of
Nightly
Operation Room
Rate
Other
Total
Average
Total
Revenue Revenue Occupancy Revenues
per Room per Room Rate
(SR)
Total
Operating
Expenses
(SR)
NET
OPERATING
INCOME (SR)
Year 1
SR600
SR150
SR750
64%
46,428,000
33,892,440
12,535,560
Year 2
SR620
SR155
SR775
66%
49,324,275
35,513,478
13,810,797
Year 3
SR638
SR162
SR800
67%
51,355,500
36,975,960
14,379,540
Year 4
SR655
SR165
SR820
68%
53,983,500
38,328,285
15,655,215
Year 5
SR675
SR170
SR845
70%
57,487,500
40,816,125
16,671,375
28%
Internal Rate of
Return
12.9%
14.2%
14.8%
16.1%
17.2%
15.1%
In conclusion, based on these preliminary projections, a 200 room 3* hotel located along the
waterfront in Yanbu Al-Sinaiyah will be a profitable financial investment.
Page 5
Note: The financial projections used in this study should be viewed as approximations. These
projections assume that the hotel will be professionally marketed, managed and maintained
under international hospitality standards and the hotel will be built using quality design,
construction practices and materials.
Each hotel investor may undertake their own study based on their experience in the hotel
industry. The Royal Commission at Yanbu Economic Planning Department is available to
discuss this preliminary study, the data and assumptions incorporated in this document. For a
confidential meeting, contact the Economic Planning Department.
Office:
Mobile:
Fax:
(04) 321-6267
(055) 600-7113
(04) 321-6343
Page 6
2012 August
Prepared by
Economic Planning Department
Royal Commission at Yanbu
Yanbu Al-Sinaiyah, Kingdom of Saudi Arabia
Page 1
Introduction
Investors in the Yanbu Waterfront are being offered a unique opportunity to invest in a once in
lifetime world class resort on the spectacular Red Sea coast of Saudi Arabia. In order to assist
investors considering these opportunities, a preliminary financial feasibility study has been prepared
for the hotel component of this investment opportunity.
The projections in this preliminary study reflect reasonable assumptions prepared by the Royal
Commission at Yanbu based on independent analysis prepared by the international firm Albert Speer
& Partners (AS&P), as well as published market and financial conditions in Yanbu Al-Sinaiyah and the
Kingdom of Saudi Arabia. This preliminary study is intended to serve investors as a basis for a more
detailed analysis and by providing reasonable projections for the investors independent analysis.
Executive Summary
This preliminary financial feasibility study is presented in five sections. The results of this study
conclude that a 5* waterfront hotel in Yanbu Al-Sinaiyah with 300 rooms is a profitable financial
investment. Furthermore:
It is estimated that the hotel construction will cost a total of approximately SR 159 million.
The hotels occupancy is projected to range 63% in year 1 to 67% in the 5th year of operation.
The Internal Rate of Return (IRR) is estimated to average 14.2% during the first 5 years of
operation.
This study is presented in five sections:
1. Hotel Development Costs
2. Hotel Operational Costs
3. Projected Hotel Occupancy
4. Hotel Revenues and Net Operating Income
5. Projected Internal Rate of Return (IRR).
Page 2
Page 3
The Yanbu Waterfront Master Plan consultant AS&P projected hotel occupancy in the first year of
operation of Yanbus waterfront hotels to be 65% and reach 72% by the 5th year of operation. For
purposes of this preliminary feasibility study, a mid-point between the Kingdoms 2011 average hotel
occupancy rate and the Yanbu Waterfront Master Plan was used ranging from 63% in year 1 to 67%
in the 5th year of operation.
75%
70%
65%
60%
66%
63%
65%
67%
64%
Year 1
Year 2
Year 3
Year 4
Year 5
63%
55%
50%
Hotel Name
Location
Movenpick
Radisson Blu
Radhwa Holiday Inn
Yanbu Al-Sinaiyah
Yanbu Al-Bahr
Yanbu Al-Bahr
Waterfront Site
Hotel
Rating
Yes
Yes (limited)
No
4*
3*
3*
SR 825 SR 900
SR 546 SR 600
SR 793 SR 936
SR 765
Source: Hotels.com.
For purposes of this preliminary feasibility study, an average room rate of SR825 per night is
conservatively projected for the 1st year and is projected to increase to an average of SR900 per night
in the 5th year of operation. Revenues from operation of the Ladies Club, restaurant and other hotel
services will also be generated from hotel guests. Additional revenues are projected to average
Yanbu Waterfront 300 Room Hotel Preliminary Financial Feasibility Study
Page 4
SR330 per room in the first year of operation increasing to SR375 per room by the 5th year of
operation.
Table II
Summary of Hotel Annual Revenues and Expenses Years 1 5
Average
Year of
Nightly
Operation Room
Rate
Other
Total
Average
Total
Revenue Revenue Occupancy Revenues
per Room per Room Rate
(SR)
Total
Operating
Expenses
(SR)
NET
OPERATING
INCOME (SR)
Year 1
SR825
SR330
SR1,155
63%
73,584,000
53,716,320
19,867,680
Year 2
SR844
SR338
SR1,181
64%
76,602,094
55,153,508
21,448,586
Year 3
SR863
SR356
SR1,219
65%
79,948,688
57,563,055
22,385,633
Year 4
SR881
SR364
SR1,245
66%
83,085,863
58,990,961
24,094,901
Year 5
SR900
SR375
SR1,275
67%
86,559,750
61,457,423
25,102,328
Internal Rate of
Return
73,584,000
19,867,680
27%
76,602,094
21,448,586
28%
79,948,688
22,385,633
28%
83,085,863
24,094,901
29%
86,559,750
25,102,328
29%
12.5%
13.4%
14.0%
15.1%
15.7%
28%
14.1%
Page 5
In conclusion, based on these preliminary projections, a 300 room 5* hotel located along the
waterfront in Yanbu Al-Sinaiyah will be a profitable financial investment.
Note: The financial projections used in this study should be viewed as approximations. These
projections assume that the hotel will be professionally marketed, managed and maintained
under international hospitality standards and the hotel will be built using quality design,
construction practices and materials.
Each hotel investor may undertake their own study based on their experience in the hotel
industry. The Royal Commission at Yanbu Economic Planning Department is available to
discuss this preliminary study, the data and assumptions incorporated in this document. For a
confidential meeting, contact the Economic Planning Department.
Office:
Mobile:
Fax:
(04) 321-6267
(055) 600-7113
(04) 321-6343
Page 6
2012 September
Prepared by
Economic Planning Department
Royal Commission at Yanbu
Yanbu Al-Sinaiyah, Kingdom of Saudi Arabia
Page 1
Introduction
Investors in the Yanbu Waterfront are being offered a unique opportunity to invest in a once in
lifetime world class resort on the spectacular Red Sea coast of Saudi Arabia. In order to assist
investors considering these opportunities, a preliminary financial feasibility study has been prepared
for the hotel component of this investment opportunity.
The projections in this preliminary study reflect reasonable assumptions prepared by the Royal
Commission at Yanbu based on independent analysis prepared by the international firm Albert Speer
& Partners (AS&P), as well as published market and financial conditions in Yanbu Al-Sinaiyah and the
Kingdom of Saudi Arabia. This preliminary study is intended to serve investors as a basis for a more
detailed analysis and by providing reasonable projections for the investors independent analysis.
Executive Summary
This preliminary financial feasibility study is presented in five sections. The results of this study
conclude that a 5* waterfront hotel in Yanbu Al-Sinaiyah with 250 rooms is a profitable financial
investment. Furthermore:
It is estimated that the hotel construction will cost a total of approximately SR 100 million.
The hotels occupancy is projected to range 63% in year 1 to 67% in the 5th year of operation.
The Internal Rate of Return (IRR) is estimated to average 20.3% during the first 5 years of
operation.
This study is presented in five sections:
1. Hotel Development Costs
2. Hotel Operational Costs
3. Projected Hotel Occupancy
4. Hotel Revenues and Net Operating Income
5. Projected Internal Rate of Return (IRR).
Page 2
Page 3
purposes of this preliminary feasibility study, a mid-point between the Kingdoms 2011 average hotel
occupancy rate and the Yanbu Waterfront Master Plan was used ranging from 63% in year 1 to 67%
in the 5th year of operation.
75%
70%
65%
60%
66%
63%
65%
67%
64%
Year 1
Year 2
Year 3
Year 4
Year 5
63%
55%
50%
Hotel Name
Location
Movenpick
Radisson Blu
Radhwa Holiday Inn
Yanbu Al-Sinaiyah
Yanbu Al-Bahr
Yanbu Al-Bahr
Waterfront Site
Hotel
Rating
Yes
Yes (limited)
No
4*
3*
3*
SR 825 SR 900
SR 546 SR 600
SR 793 SR 936
SR 765
Source: Hotels.com.
For purposes of this preliminary feasibility study, an average room rate of SR825 per night is
conservatively projected for the 1st year and is projected to increase to an average of SR900 per night
in the 5th year of operation. Revenues from operation of the restaurants and other hotel services will
also be generated from hotel guests. Additional revenues are projected to average SR330 per room
in the first year of operation increasing to SR375 per room by the 5th year of operation.
Page 4
Table II
Summary of Hotel Annual Revenues and Expenses Years 1 5
Average
Year of
Nightly
Operation Room
Rate
Other
Total
Average
Total
Revenue Revenue Occupancy Revenues
per Room per Room Rate
(SR)
Total
Operating
Expenses
(SR)
NET
OPERATING
INCOME (SR)
Year 1
SR825
SR330
SR1,155
63%
66,398,063
48,470,586
17,927,477
Year 2
SR844
SR338
SR1,181
64%
68,985,000
49,669,200
19,315,800
Year 3
SR863
SR356
SR1,219
65%
72,287,109
52,046,719
20,240,391
Year 4
SR881
SR364
SR1,245
66%
74,980,125
53,235,889
21,744,236
Year 5
SR900
SR375
SR1,275
67%
77,950,313
55,344,722
22,605,591
Internal Rate of
Return
66,398,063
17,927,477
27%
68,985,000
19,315,800
28%
72,287,109
20,240,391
28%
74,980,125
21,744,236
29%
77,950,313
22,605,591
29%
17.9%
19.3%
20.3%
21.7%
22.6%
28%
20.3%
In conclusion, based on these preliminary projections, a 250 room 5* hotel located along the
waterfront in Yanbu Al-Sinaiyah will be a profitable financial investment.
Yanbu Waterfront 250 Room Hotel Preliminary Financial Feasibility Study
Page 5
Note: The financial projections used in this study should be viewed as approximations. These
projections assume that the hotel will be professionally marketed, managed and maintained
under international hospitality standards and the hotel will be built using quality design,
construction practices and materials.
Each hotel investor may undertake their own study based on their experience in the hotel
industry. The Royal Commission at Yanbu Economic Planning Department is available to
discuss this preliminary study, the data and assumptions incorporated in this document. For a
confidential meeting, contact the Economic Planning Department.
Office:
Mobile:
Fax:
(04) 321-6267
(055) 600-7113
(04) 321-6343
Page 6