German-based startup NeuSpace, established during the COVID-19 pandemic to support hotels to overcome the plunge in occupancy rates has now started operations in Saudi Arabia.
The startup aims to assist operators to develop new strategies to generate revenue from their empty spaces. As per the company’s website, it targets to address the needs of hotel investors, operators and the wider community surrounding the property.
“For hotel properties still in the completion phase, we feel it is best to evaluate the perspective and to diversify pre-opening. To be empathic to the existing (or planned) infrastructure and environment of the location, we run a feasibility study and look at how space could be best used from an ROI (return on investment) as well as a community perspective. Turning function spaces into day nurseries, delis, and bakeries.”
The company delivers instant solutions to continue some of the hospitality jobs and to add others to create attractive living space for communities within one to four months, depending on the individual projects.
According to the global hotel data analysis company STR’s November report, the average occupancy rate in Saudi Arabia was 34.7 percent which was down from 38.7 percent in 2019. As a result, the average revenue per available room fell 35.5 percent year-on-year to $46.05.
The Canada-based real estate consultancy firm, Colliers International, has forecasted that average occupancy rates in Riyadh and Alkhobar will be 55 percent, 51 percent in Jeddah and Madinah, and 37 percent in Makkah.
Ms. Schaeflein stated that the startup’s key objectives were formulated around major pillars of value preservation, creating new housing spaces and innovative housing concepts. The company looked at how areas like roof gardens, social spaces, pools or spas could be utilized by local residents.
NeuSpace has also been working on plans to offer back-office services and facilities to residents to completely utilize staffing levels. This could include offering dog-minding services, turning rooms into office or retail areas or renting out restaurant and entertainment spaces when footfall was low.