Red Sea Global Acquires 90% of Resort in Sardinia to Convert It into a Five-Star Hotel

Red Sea Global, the real estate arm of Saudi Arabia's Public Investment Fund, is acquiring 90% of the "Santo Stefano" resort on the Italian island of Santo Stefano, while entities linked to the Benetton family retain the remaining 10%, according to Montenapo Daily.

The new owner plans to convert the former coastal resort belonging to the Valtur Group into a luxury five-star hotel, in a project described as the Public Investment Fund's first collaboration with Italian partners, giving the Saudi company a foothold in a long-standing European tourism market that welcomes visitors year-round. The conversion to five-star status is a step that raises average nightly rates and targets a high-spending segment.

The value of the deal was not disclosed, leaving the actual investment size without an announced figure at a time when the Saudi company is expanding outside the domestic market toward luxury tourist destinations that rely on high-spending visitors and maintain stable occupancy rates throughout the year.

This move comes within a broader trend among Gulf sovereign wealth funds toward diversifying their real estate and hospitality investments in high-value European tourism markets, giving them a presence in stable destinations and spreading portfolio risks away from regional markets alone. Notably, the deal occurred without revealing its value, making it currently impossible to gauge the scale of this expansion compared to similar deals in the European market.

What do these terms mean?

Public Investment Fund: The Saudi sovereign wealth fund that invests domestically and abroad on behalf of the state. Subsidiary: An entity owned or controlled by a larger parent company. Five-star resort: A hotel classification reflecting the highest levels of service and amenities.