Saudi eateries give tough competition to foreign outlets
More than two-thirds of Riyadh’s new restaurants are Saudi, dwarfing American and Lebanese influenced eateries, according to a report from real estate firm Knights Frank.
The Saudi capital has seen the birth of 288,000 square meters of new developments since 2016, when the National Transformation Plan was announced, the research says. “The Kingdom’s capital is beginning to morph into a foodie’s treasure trove and we’re not done yet,” Faisal Durrani, head of Middle East research at Knight Frank said.
This growth is led by homegrown restaurants and cafes, he added, with 68 percent of Riyadh’s new outlets being Saudi — 21 percent of which specialize in international cuisine.
“American food outlets account for 16 percent of food and beverage outlets, while Lebanese restaurants are the third most prevalent at 13 percent,” Durrani said.
The US and the UAE are the second and third largest sources of restaurant chains in Riyadh, respectively, he added.
“International brands must adapt their proposition across the full spectrum to suit demand, both in terms of operational aspects, as well as the actual menu offering itself,” said Pedro Riberio, head of retail advisory KSA at Knight Frank. The Kingdom’s capital will further benefit from upcoming tourism developments, including the Bujairi Terrace and Diriyah Gate, which the Knight Frank report said will add “15,000 sq. meters of lifestyle retail space to the capital when its 17 restaurants open their doors in 2022.”
This rapid growth and competition are putting pressure on older developments, the report indicated, with some operators struggling to keep vacancy rates and footfall up.