Saudi Wealth Fund Bets $850 Million on Expanding Luxury Hotel Chain Across Middle East and Europe

Samantha Miller

The Saudi Public Investment Fund is splashing out $850 million to become the largest shareholder in Sir Rocco Forte’s chain of opulent hotels and resorts, with ambitious plans to add more five-star properties across Europe and the Middle East.

The deal gives Forte an infusion of cash to deliver on long-delayed promises of growth for his ultra high-end brand. After losing family control of his first luxury hotel group in a hostile takeover, the hotelier is getting a second chance to expand his namesake company into a global hospitality powerhouse.

Saudi Money Fuels Global Ambitions

On Monday, Forte announced the Saudi sovereign wealth fund will acquire a 49% stake in Rocco Forte Hotels for $990 million, valuing the entire chain at over $2 billion. As part of the deal, existing minority investor CDP Equity will sell its 23% stake.

Forte and his sister Olga Polizzi will hold onto a slim 51% controlling interest in the company their father, legendary hotelier Lord Charles Forte, built into a European lodging empire.

The billionaire Saudi Public Investment Fund (PIF) will also inject fresh capital to bankroll Forte’s plans for his luxury hotel collection. With PIF’s deep pockets backing him, the hotelier aims to double the portfolio within five years.

“We’re in a good position in the right industry at the right time,” Forte told the Financial Times during an interview at his group’s Brown’s Hotel in London.

Rocco Forte Hotels currently operates 14 hotels and resorts in iconic European destinations like Rome, Florence, Madrid and Scotland.

Expansion Focused on Middle East and Italy

Emboldened by PIF’s $990 million investment, Forte is planning an aggressive expansion into the Middle East while building on its strong foothold in Italy.

The company aims to open three new hotels in 2024 and 2025. One will be in Dubai, marking a long-awaited return to the high-end Middle East hospitality sector after exiting Saudi Arabia in 2019.

Forte also plans an expedition to Saudi Arabia early next year to search for new hotel sites. With PIF as his new financial backer, he expects “a lot more business” from Gulf visitors and hopes to capitalize on growing Middle East tourism.

The luxury hotelier already operates eight hotels across Italy and sees room to expand his hometown base further.

Betting on High-End Travel Comeback

News of the Saudi-backed expansion comes after Europe’s luxury hotels rebounded strongly from the pandemic, fuelled by a surge in big-spending American travelers.

Average room rates at high-end establishments ran 48% higher than 2019 levels this summer season. That outpaced the wider 24% rate increase across the European hospitality sector.

Forte is betting the resilient luxury market will power future growth. He argues high-end hospitality is “quite protected” from economic downturns compared to mainstream lodging brands.

The hotelier is “very bullish” on ongoing demand growth from US travelers, which already account for over a third of Rocco Forte Hotel’s turnover. With Saudi PIF as a new investor, he also expects his Middle East customer base to expand substantially.

Family Retains Control as PIF joins Board

While PIF is providing financial muscle, Rocco Forte Hotels remains very much a family-run business at heart.

“Having a partner like PIF gives you much more solidity to the outside eye…banks love you much more,” Forte admitted.

But he stressed that family management still leads day-to-day operations and obsesses over every detail that gives Rocco Forte Hotels its unique luxury flair.

“We’re in the hotels on a regular basis: people see us, they hear from us directly…they see how much we care about the details,” the hotelier noted.

As part of the deal, PIF will appoint two directors to the company’s board, while the Forte family retains three seats and overall voting control.

Rebounding Revenue Sets Stage for Growth

Rocco Forte Hotels heads into its expansion on strong financial footing as luxury demand roars back.

In the year ending April 2022, overall group revenues hit $350 million – more than double the prior year’s pandemic-depressed results.

Earnings before interest, taxes and other charges came in at $78 million for the year. That’s nearly quadruple 2021 as hotels returned to full operation.

The warm financial results provide a springboard for achieving Forte’s long-delayed dreams of transforming his eponymous chain into a far larger luxury player on the global stage.

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Samantha Miller is a business and finance journalist with over 10 years of experience covering the latest news and trends shaping the corporate landscape. She began her career at The Wall Street Journal, where she reported on major companies and industry developments. Now, Samantha serve as a senior business writer for, profiling influential executives and providing in-depth analysis on business and financial topics.
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