Red Sea Global considering public listing

• CEO John Pagano says developer in talks with lenders
• First hotels to open at destinations, Red Sea Project and Amaala
• Projects estimated to contribute $9bn to the GDP of Saudi Arabia

Red Sea Global, the developer behind one of Saudi Arabia’s biggest gigaprojects, is studying the possibility of a public market offering, a senior executive said. 

“There will be some kind of public market event, whether it’s an initial public offering, whether it’s an establishment of a REIT [real estate investment trust], those are things that we’re currently studying,” John Pagano, chief executive of Red Sea Global (RSG), said in an interview with Bloomberg.

Pagano said the developer was in early talks with lenders and stakeholders, but a listing could be launched by 2026, once the initial hotels have launched.

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RSG is set to open its first hotels this year at the new Saudi Arabian tourist destinations, Red Sea Project and Amaala.

The company, owned by the Public Investment Fund, the kingdom’s sovereign wealth fund, has spent $5 billion so far and will spend another $15 billion by 2024, Pagano told AGBI in a video interview at the Arabian Travel Market in Dubai last week.

“Between Red Sea and Amaala, we will open 24 resorts – a total of over 4,200 hotel rooms – by next year,” he said.

The projects are estimated to contribute $9 billion to the GDP of Saudi Arabia and form part of the kingdom’s Vision 2030 diversification programme. The tourism sector accounts for 3.4 percent of GDP.

Red Sea Global

“There’s a lot of room to make tourism a bigger contributor to the economy,” Pagano said.

Spread across 28,000 sq km and including an archipelago of more than 90 islands, The Red Sea Project will be powered by 100 percent renewable energy and is committed to carbon neutrality.

Due to be completed by 2030, the development will host 50 resorts providing up to 8,000 hotel rooms and will feature more than 1,000 residential properties, all of which will be spread across 22 islands and six inland sites. There will also be an international airport, marinas, golf courses and entertainment and leisure facilities.

RSG last month launched a new company to boost sports tourism in Saudi Arabia.

Akun, meaning “to be”, is a new adventure sports company that will operate and manage adventure and sports experiences at RSG destinations, including gravel- mountain-, fat-tyre and electric biking, trail running and hiking through diverse natural trails. 

Akun has already signed two initial partnership deals with operators Bungy New Zealand and Air Sports Group, who will assess the capacity for adventure tourism at RSG destinations.