Indonesia Becomes First Foreign Country to Own Property in Mecca in SAR 2 Billion Deal
The Indonesian Danantara fund completed the purchase of the Novotel Thakher Makkah hotel for SAR 2 billion, marking the first ownership by a foreign country in the destination.
Indonesia has become the first foreign country to own property in the "Thakher Makkah" destination after the sovereign wealth fund "Danantara" received the ownership documents for an acquisition deal worth SAR 2 billion, equivalent to $531.4 million. "Thakher Development", the master developer of the destination, handed over the paperwork completing the acquisition of the 1,461-room "Novotel Thakher Makkah" hotel and 14 adjacent development land plots.
The deal comes following the implementation of the non-Saudi real estate ownership law that came into force in January, supporting the Kingdom's goal to host 30 million Umrah pilgrims annually by 2030, compared to 8.5 million in 2019. This step represents a shift in Indonesia's relationship with seasonal housing in Mecca, as it seeks to secure permanent accommodation for its Hajj and Umrah pilgrims.
Indonesia holds the largest Hajj quota globally, with 203,320 regular slots in 2026, while around 1.5 million Indonesians perform Umrah each year. The hotel is expected to accommodate around 4,400 pilgrims during each Hajj season, making it a cornerstone of Indonesian lodging arrangements.
Hotel operator "Accor" will continue to manage the hotel, which consists of three 19-story towers. "Danantara" plans to develop the 14 plots, covering an area of 44,088 square meters, into hotels featuring approximately 6,000 additional rooms and a commercial center with over 90 stores, with an investment exceeding SAR 2 billion. Notably, the "Thakher Makkah" destination spans 320,000 square meters located 1.2 kilometers north of the Grand Mosque.
What do these terms mean?
Sovereign Wealth Fund: A state-owned investment fund that manages its surplus funds and invests in assets domestically and internationally.
Real Estate Ownership Rights: The right to own real estate and dispose of it through sale, purchase, and lease in accordance with the law.
Hajj Quota: The number of pilgrims a country is permitted to send during the Hajj season according to agreed-upon quotas.
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