Hotel groups are increasingly looking beyond the congested coastal areas of the Mediterranean for new luxury resort developments. This shift is characterized by investments in previously underdeveloped regions and international expansion, moving away from the mass tourism model. This strategy aims to capitalize on rising foreign investment in the European tourism sector and cater to a demand for exclusive, less-trafficked destinations.
Starhotels, an Italian hospitality group, is a prime example of this trend. After achieving its best financial performance in 2024 with $34.3 million in net profit from $314.8 million in revenue, the company is making its foray into luxury resorts. Its first resort, the Hermitage Hotel & Resort Forte dei Marmi – Starhotels Collezione, opened recently with 59 rooms and suites near Tuscan beaches. The group plans to open a five-star boutique hotel with 19 rooms in Capri by 2028 after renovating Villa Blu Capri. Starhotels is also eyeing further growth in Italy, particularly in underdeveloped regions like Sicily, Apulia, and the Italian Lakes Region, which CEO Elisabetta Fabri notes are only 4% developed for tourism, highlighting significant potential for foreign investors.
Red Sea Global (RSG), controlled by Saudi Arabia's Public Investment Fund, is also expanding its luxury footprint beyond its domestic market. RSG has acquired a 90% stake in the Santo Stefano Resort in Sardinia, marking its first project outside Saudi Arabia. This resort, with assets valued at $34.8 million, was previously shuttered and is located on a private island accessible only by ferry. RSG's entry into the Mediterranean market, with its deep pockets and long-term investment horizon, is seen as a significant development for the region's resort assets, which have historically faced challenges in attracting institutional buyers due to illiquidity and operational complexities.
Additionally, Park Hyatt is set to debut in Portugal with Park Hyatt Comporta and Park Hyatt Comporta Residences, expected to open in 2029. This project, a collaboration with Portuguese real estate developer Coporgest, will introduce the Park Hyatt brand to Portugal in the Comporta region, known for its relaxed beach lifestyle and natural surroundings. The development will include 58 guestrooms and suites, six two-bedroom private villas, and 22 fully serviced residences, along with amenities like swimming pools, a wellness center, and proximity to golf courses. This expansion further solidifies the trend of luxury hotel brands seeking out distinctive and less-saturated destinations in Europe.
