IHG Hotels & Resorts and a SEDCO Capital-managed investment fund have reached a management agreement to open another Hotel Indigo property in Jeddah, Saudi Arabia.

The new 150-room hotel will be located within the Grand Square mixed-use development on King Abdulaziz Road in Jeddah.

The project represents the first cooperation between IHG and the Saudi real estate investment fund.

The development of Grand Square is the result of a partnership involving Ajdan Real Estate Development Company, SEDCO Capital and MASIC Investment Company. The site will combine hospitality, retail, and office facilities in a single destination.

IHG Hotels & Resorts India, Middle East and Africa managing director Haitham Mattar said: “Lifestyle travel is becoming increasingly sought-after in the Kingdom, and we are looking forward to introducing another Hotel Indigo property in Jeddah as part of our expanding lifestyle portfolio.

“This signing not only strengthens our footprint in one of the country’s most dynamic cities but also supports Saudi Arabia’s broader ambitions to diversify its tourism and hospitality offering.”

The new hotel aims to provide accommodation to both business and leisure travellers visiting the Grand Square development and surrounding areas.

Mattar added: “This property is as unique as the neighbourhood it is part of, and we are excited to bring it to life, creating a new destination for curious travellers, residents, and professionals alike.”

IHG’s agreement signals continued growth for international hospitality groups in the region.

Hotel Indigo Grand Square Jeddah will operate as part of IHG’s lifestyle portfolio.

It will form part of IHG’s ongoing expansion in Saudi Arabia, where the company currently manages 46 hotels spanning six different brands.

There are also plans for 60 additional hotels in the country over the next three to five years, said IHG.

SEDCO Capital chief executive officer Abdulwahhab Abed said: “Hotel Indigo Grand Square Jeddah represents a pivotal step within an integrated urban project designed to serve the community and deliver added value to the real estate sector.

“Through our partnership with IHG Hotels & Resorts, we are enhancing the hospitality experience within the ‘Grand Square’ project and reinforcing Jeddah’s position as a leading urban and tourism hub, in line with the goals of Saudi Vision 2030.”

In Europe, IHG recently opened a new Hotel Indigo property in Torquay, adding to its UK lifestyle offerings.