Red Sea giga-project launches new island despite PIF budget cuts

• First scheme beyond phase one
• 400 hectares of white sand beaches
• Opening planned in 2028

Saudi Arabia’s Red Sea Global has launched its first island development on the $23.6 billion Red Sea giga-project.

The opening comes despite the $925 billion Public Investment Fund ordering deep spending cuts across more than 100 of its companies, as AGBI reported last month.

Some budgets have been cut by as much as 60 percent, sources said, as the government reprioritises projects. The cuts were approved at a PIF board meeting in December and are now being rolled out.

Red Sea Global, the master developer that is also developing the Amaala tourism project, is backed by the PIF.

Earlier this year, sources said that of the Saudi giga-projects, including Roshn, Qiddiya, Diriyah, Red Sea Global and Neom, it was Red Sea Global and Neom that have borne the brunt of the spending cuts because they are more ambitious, costly and slower to yield returns.

In October last year Ben Edwards, the company’s group head of cost, commercial and procurement, told delegates at a hospitality sector forum in Dubai that it was due to open 11 resorts at the Red Sea in 2025 and eight at Amaala.

Laheq Island is the first scheme beyond phase one of the Red Sea giga-project to be revealed. Covering 400 hectares of white sand beaches, it will focus on residential development, with an opening planned in 2028.

The Ring, 800m in diameter, will be the centrepiece and house luxury apartments, hotels and retail space.

The island will include a 115-berth marina, sailing and watersports schools and an 18-hole golf course.

It will also have two luxury resort hotels, one focusing on wellness and the other on adventure and lifestyle.

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The London-based architectural practice Foster and Partners is the project’s designer.
 
The first hotels, from Six Senses and St. Regis, opened in March last year at the Red Sea Global site south of the remote town of Al Wajh on the northern Red Sea coast of Saudi Arabia.

Upon full completion in 2030, the development will comprise 50 resorts, 8,000 hotel rooms and more than 1,000 residential properties across 22 islands and six inland sites.

Saudi Arabia hopes to attract 19 million tourists a year to its Red Sea giga-projects and other resorts being built along the country’s west coast.