A Q&A with by John Pagano, CEO of Red Sea Development Company
Posted on February 20, 2019
The Red Sea Project includes a vast archipelago of more than 50 untouched islands, with direct access to unspoiled and thriving coral reefs
Investors line up for luxury opportunity with the Red Sea Project
The first phase of the Red Sea megaproject in Saudi Arabia’s Western Region is on track for completion in 2020.
The MEED Business Review caught up with John Pagano, CEO of Red Sea Development Company, to understand more about the landmark Saudi Arabian project as they ramp up towards the completion of phase one next year.
Below is the full interview.
What is the Red Sea Development Company? How is it structured and what are its objectives?
The Red Sea Development Company (TRSDC) is a closed-stock joint-venture company wholly owned by the Public Investment Fund (PIF) of Saudi Arabia, one of the world’s largest sovereign wealth funds. The company was incor- porated to spearhead the development of the Red Sea Project, one of three giga-projects under the umbrella of PIF.
The Red Sea Project is the most ambi- tious tourism development in the world. We are aiming to create an unparalleled variety of immersive experiences, deliv- ered to the highest standards of person- alised, luxury service. We are taking a pioneering approach, offering travellers a seamless experience, made simple through technology, while setting new standards in sustainable development.
As part of the project, we are creating a diverse range of luxury hospitality op- tions, from single island luxury proper- ties to design-driven beachfront resorts, holistic wellness retreats and innovative, unique inland experiences in the moun- tains and desert dunes. Supporting the offer will be a comprehensive array of hospitality experiences including food and beverage, luxury retail, entertain- ment, cultural and recreational activities.
The project is ideally positioned to respond to international global tourism trends and is poised to contribute SR22bn ($5.9bn) to the economy as well as cap- turing a share of the SR62bn in outbound tourism spend from Saudi Arabia.
What have been the key milestones achieved so far?
TRSDC is creating new opportunities for partnership and investment in line with its core objectives of sustainability and socio-economic development. The initial preparatory phases have included envi- ronmental and sustainability studies in partnership with renowned institutions.
The master plan was approved by the Board of Directors at the end of 2018. It was developed in partnership with WATG and Buro Happold and includes design concepts from some of the world’s most prominent architecture firms. The plan was informed by a series of wide-ranging environmental studies to ensure that the ecologically sensitive area is fully pro- tected during and after development.
Work has started at the project Base Camp, which will oversee the construc- tion of the essential enabling works to support the destination’s development.
At the same time, we are moving into the detailed design phase for our various built assets and are in conversations with the investors and partners who will work with us on bringing the destination to life. The first phase of the project, sched- uled for completion in 2022, will include 3,102 hotel rooms, as well as residential properties and recreational facilities. We are also developing an airport to serve the destination, transportation and utilities infrastructure, and a marina.
What key milestones can we expect in the coming year?
Construction is under way at the destination. We have opened a Project Base Camp that houses 60 project and con- struction managers, health, safety and environmental professionals, government affairs specialists and other key staff. The Base Camp is overseeing construction
of essential supporting infrastructure, including a Construction Village that will house up to 10,000 people and a Man- agement Village with offices and accom- modation, to support a range of project management and corporate functions.
We are also building temporary roads and jetties and a bridge connecting the hub island to the shore in order to trans- port materials and equipment onto the site. Construction of permanent project components is due to start in the second half of the year. Across every aspect
of the project, we are working hard to ensure that our operations have minimal impact on the surrounding ecosystems while providing a safe and comfortable environment for our people to work in.
How have investors responded and which investment model is being used?
We have had an overwhelming response from the investment community, a reflec- tion of the opportunity our project offers and the positive changes taking place in the kingdom as part of Vision 2030.
We are exploring investment opportu- nities through joint-venture partnerships to develop the commercial components of the project, and are looking at pub- lic-private partnerships to support utility infrastructure, power generation, trans- portation and other hard infrastructure.
We are focused on partnerships with organisations that share our commitment to enhancing the natural ecosystems that make the destination so unique.
The Red Sea Development Company is a Platinum Sponsor at AHIC 2019 and will be attending the event in Ras Al Khaimah to meet with potential partners, investors and suppliers.
If you haven't already registered, then purchase your pass today to meet the leadership team and other representatives of TRSDC and all of the other leading hotel operators, owners, developers, investors and consultants participating this year.