Hotel Management Agreements Evolve as GCC Hospitality Market Enters New Growth Phase, Says Greenberg Traurig’s Elias Hayek

Hotel management agreements across the GCC are entering a more complex phase as hospitality investment, mixed-use developments and major Saudi giga-projects gather momentum. Speaking with Apratim Ghoshal, Senior Editor for TTW at FHS 2026 in Dubai, Elias Hayek, Co-Chair of the Middle East and European Hospitality Group at Greenberg Traurig, said the regional market remains strong despite recent geopolitical uncertainty.

He noted that hotel management agreements have evolved significantly over three decades, expanding from relatively short contracts into extensive frameworks covering hundreds of commercial, operational and legal considerations. The shift reflects the need for hotel owners and global brands to manage relationships that can continue for 25 to 30 years or longer.

Elias Hayek of Greenberg Traurig explains how hotel management agreements are becoming more complex as GCC hospitality investment and Saudi giga-projects accelerate.

Hotel Management Agreements Are Becoming More Complex Across the GCC

Hotel management agreements are evolving from relatively straightforward contracts into highly detailed frameworks that govern long-term relationships between hotel owners and international brands, according to Elias Hayek, Co-Chair of the Middle East and European Hospitality Group at Greenberg Traurig.

Speaking exclusively at FHS 2026 Dubai, Hayek highlighted the changing dynamics of the GCC hospitality market, the growing complexity of hotel management agreements and the legal challenges emerging from Saudi Arabia’s increasingly ambitious giga-projects.

Hayek said the current environment remains positive despite geopolitical uncertainty, with strong attendance and optimism at FHS 2026 reflecting renewed confidence across the regional hospitality and investment sectors.

He also pointed to continued enquiries from developers and private equity investors as an important indicator of market activity, suggesting that hospitality investment and development activity in the region has returned to a strong level.

How Are Hotel Management Agreements Changing?

Hotel management agreements have become substantially longer and more sophisticated as developers and hotel brands attempt to address the increasingly complex realities of operating properties over several decades.

Hayek explained that the evolution of these agreements can be seen clearly over his approximately 30 years of experience in the sector. Agreements that once consisted of around 30 pages have developed into suites of documents that can collectively exceed 350 or 400 pages.

This expansion reflects the growing number of commercial, operational and legal issues that must be addressed between hotel owners and brands.

Rather than treating a hotel management agreement as a simple transaction, Hayek described it as a long-term framework governing the relationship between two parties.

The agreements can cover a 25- to 30-year period or even longer, requiring developers and brands to consider not only immediate commercial arrangements but also circumstances that could emerge many years after a property opens.

Why Are Hotel Management Agreements Similar to Joint Venture Agreements?

Although hotel owners and international brands have different commercial interests, the relationship established through a hotel management agreement is effectively a long-term partnership requiring detailed contractual planning.

Hayek described these agreements as resembling a joint venture agreement because they establish the framework for how the parties will interact throughout the life of a hotel.

The objective is therefore not simply to determine who wins or loses a negotiation when the contract is signed.

Instead, the agreement needs to provide a roadmap for handling operational, financial, commercial and legal circumstances that could arise throughout the property’s lifecycle.

This is particularly important in the GCC, where hotel developments are increasingly incorporated into large-scale masterplans containing hotels, branded residences, retail, entertainment, offices and other components.

As projects become more interconnected, the contractual relationship between developers, hotel brands and other stakeholders also becomes more complicated.

What Makes Long-Term Hotel Contracts So Detailed?

The increasing length of hotel management agreements reflects the hospitality industry’s accumulated experience with different operational and commercial situations.

Hayek explained that issues encountered during the development and operation of hotels gradually find their way into future agreements.

As new circumstances emerge, additional contractual provisions are developed to address them.

Over time, individual issues can therefore receive their own clauses, resulting in agreements containing hundreds of provisions.

The purpose is not necessarily to anticipate every conceivable event. Instead, the contracts need to address known and highly probable circumstances while also establishing mechanisms for dealing with less likely events.

This approach is particularly relevant to hotel developments because the relationship between an owner and a global brand can continue for decades.

A disagreement over an issue that was not adequately addressed at the beginning of a project can become considerably more difficult and expensive to resolve once a hotel is operational.

What Does the GCC Hospitality Market Look Like in 2026?

The outlook for the GCC hospitality sector remains positive, despite a period of caution linked to geopolitical uncertainty.

According to Hayek, the market appears to have experienced a temporary pause as investors and developers assessed the potential consequences of geopolitical developments.

That pause now appears to be easing, with new projects being announced and investment activity gaining momentum.

Hayek said his work advising developers and private equity funds provides a direct indication of market sentiment. The level of enquiries relating to hospitality investments and developments has returned to levels comparable with previous years.

The strong turnout at FHS 2026 in Dubai also demonstrated continued confidence in the region.

For investors, developers and hotel operators, the renewed activity indicates that the GCC remains an important global hospitality development market.

Why Are Saudi Giga Projects Creating New Legal Challenges?

Saudi Arabia’s giga-projects represent one of the most complicated areas of hospitality development because many projects combine multiple uses and properties within large masterplanned environments.

Hayek highlighted the complexity created by mixed-use developments located on interconnected plots of land.

These projects can involve hotels, residences and other assets operating within the same master development, creating a need for legal and regulatory structures capable of managing relationships between different property owners and users.

One of the major challenges is that the legal and regulatory framework has been evolving alongside the projects themselves.

The scale and complexity of Saudi giga-projects have created circumstances that were not necessarily contemplated by traditional real estate regulations.

As a result, there can be a gap between the way global hotel brands and developers expect a project to operate and what the existing legal framework allows.

How Are Mixed-Use Developments Affecting Hotel Brands?

Mixed-use developments introduce additional layers of complexity because hotel brands may have responsibilities or standards that extend beyond the hotel itself.

A development could include a branded hotel alongside branded residences, common areas and other components.

Questions can therefore emerge around how brand standards should be applied, who has authority over shared facilities and how different ownership structures interact.

Hayek specifically highlighted issues involving owners’ association structures, voting rights and brand standards.

These issues can become particularly complicated when different components of a master development have separate owners but share infrastructure, facilities or common areas.

For international hotel brands, maintaining consistency with global brand standards is an important part of protecting the brand’s identity and customer experience.

For developers and individual property owners, however, those requirements must operate within the applicable local legal framework.

The contractual and regulatory structures therefore need to work together.

What Is the Regulatory Challenge Facing Saudi Hospitality Development?

Saudi Arabia is undergoing a regulatory evolution designed to better accommodate the country’s rapidly developing real estate and hospitality landscape.

Hayek noted that the country’s regulatory framework is being improved to reflect the realities of complex mixed-use projects.

The challenge is effectively one of regulatory alignment.

International hotel brands and developers often bring operating structures and contractual models developed across multiple global markets.

Saudi Arabia’s regulatory environment, meanwhile, is adapting to a new generation of projects that are larger, more integrated and more complex than many conventional developments.

This creates a transitional period in which the legal framework and commercial practices must increasingly converge.

Hayek described the situation as a gap between the regulatory environment and the operating framework, while expressing optimism that the gap is being addressed.

What Role Is RERA Playing in Saudi Arabia’s Hospitality Development?

The Real Estate General Authority (RERA) is playing an important role in the development of Saudi Arabia’s real estate regulatory framework.

Hayek referred to a RERA white paper that incorporates input from stakeholders, including law firms and other market participants, with the objective of advancing the regulatory framework.

The consultation and development process is significant because industry stakeholders can identify practical challenges emerging from large-scale mixed-use developments.

Greater alignment between regulation and international development practices could make it easier for developers and global hotel brands to structure projects while maintaining compliance with Saudi law.

For investors, regulatory clarity is particularly important because large hospitality projects typically require substantial capital commitments and long development timelines.

A clearer legal framework can reduce uncertainty and provide greater confidence to developers, institutional investors, private equity funds and international hotel operators.

What Does This Mean for International Hotel Brands and Developers?

The changing GCC hospitality landscape means that developers and hotel brands need to approach management agreements as strategic, long-term instruments rather than standard operating contracts.

The growing complexity of hotel management agreements reflects the scale of modern hospitality developments and the increasing number of stakeholders involved.

For developers, careful negotiation can help establish appropriate protections around operational control, financial responsibilities, brand requirements and future changes to the development.

For hotel brands, detailed contractual provisions can protect brand standards and provide clarity around how properties should be managed over their long operating lives.

In Saudi Arabia, these considerations become even more important because mixed-use giga-projects can involve multiple ownership structures, shared infrastructure and complex relationships between different assets.

Why Will Hotel Management Agreements Remain Critical to GCC Hospitality Growth?

The continued expansion of the GCC hospitality sector is likely to make hotel management agreements even more important.

As investment increases and new hotels become part of larger mixed-use developments, the agreements governing hotel-brand relationships will need to accommodate increasingly sophisticated operating environments.

Hayek’s comments at FHS 2026 underline an important shift in the regional hospitality industry: growth is no longer simply about adding hotel rooms.

Developers, investors and hotel companies are creating integrated destinations that require carefully coordinated legal, commercial and operational structures.

The success of these projects will therefore depend partly on whether contractual frameworks can evolve alongside the physical developments and regulatory environment.

For Saudi Arabia in particular, the continued refinement of real estate regulations could help close the gap between international hospitality operating models and local legal requirements.

GCC Hospitality Growth Brings a New Era of Contractual Complexity

The GCC hospitality market is entering another period of strong development, with Saudi Arabia’s giga-projects adding unprecedented scale and complexity to the regional investment landscape.

At FHS 2026 Dubai, Elias Hayek of Greenberg Traurig highlighted how hotel management agreements have evolved into extensive long-term frameworks covering hundreds of potential issues. As Saudi regulations continue adapting to sophisticated mixed-use developments, closer alignment between legal structures and international hospitality practices could provide greater certainty for hotel owners, developers, investors and global brands.

The cause is the rapid expansion of GCC hospitality, particularly complex Saudi giga-projects combining hotels, residences and other uses. The answer is more detailed hotel management agreements that clearly define responsibilities, brand standards, voting rights, common areas and potential disputes over long-term operations. The reason is simple: modern hospitality developments involve multiple stakeholders, interconnected properties and regulatory requirements that traditional contracts may not adequately address. Elias Hayek explained that agreements have consequently expanded into hundreds of clauses, reflecting lessons learned across the industry. As Saudi Arabia updates its regulatory framework, greater alignment between legal rules and international hospitality practices should provide investors and developers with increased certainty.

The evolution of hotel management agreements reflects the changing scale and sophistication of the GCC hospitality industry. Elias Hayek’s comments at FHS 2026 underline how long-term relationships between hotel owners and global brands now require detailed contractual frameworks capable of addressing complex operational and legal scenarios. Saudi Arabia’s giga-projects are intensifying this requirement, particularly where hotels, branded residences and shared facilities operate within integrated master developments. As the country continues refining its real estate regulations, the gap between legal structures and international hospitality practices is expected to narrow. For developers, investors and hotel brands, clearer frameworks could support stronger partnerships and greater confidence in future GCC hospitality growth.