Saudi Arabia: Red Sea Global to acquire Sindalah Island Resort project
Saudi Arabia’s state-backed developer Red Sea Global is set to take over the long-delayed Sindalah island resort, marking a significant effort to salvage one of the most high-profile setbacks within the kingdom’s Vision 2030 transformation plan, according to the company’s chief executive.
Red Sea Global CEO John Pagano confirmed the transition in remarks to Reuters on the sidelines of a Saudi business conference in Rome, saying the company will assume responsibility once the handover is finalized.
“It hasn’t officially been handed over, but it will, and when it does we will then assume responsibility for it. We’ll assess how to complete it and bring it back to life,” Pagano said.
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The move places Sindalah—originally conceived as part of the NEOM megaproject—under the control of a developer with a track record of delivering tourism destinations along Saudi Arabia’s Red Sea coast.
A flagship project that never opened
Despite a high-profile VIP launch event in late 2024 attended by celebrities and hosted on superyachts, Sindalah has never officially opened to the public. The multibillion-dollar island development has remained incomplete, with sources describing widespread issues in construction quality and project execution.
The launch event, which was intended to showcase progress on NEOM’s luxury tourism ambitions, instead exposed visible finishing defects that embarrassed senior officials, according to multiple sources familiar with the project.
Shortly after the event, NEOM CEO Nadhmi al-Nasr was removed from his position, amid growing scrutiny over delivery timelines and execution standards.
“In the rush to finish they got it wrong,” one source said, describing the fallout as decisive for leadership changes within NEOM.
Planning flaws and environmental challenges
Beyond construction issues, Sindalah has reportedly suffered from significant environmental and engineering miscalculations.
Sources said the island’s marina is frequently affected by waves that make mooring unstable for much of the year, while strong winds regularly impact operations. These conditions were allegedly not fully accounted for in early planning and feasibility assessments.
In 2023, Saudi Crown Prince Mohammed bin Salman visited Sindalah as part of a televised interview with Fox News, where the island’s windy conditions were visibly apparent during filming.
Red Sea Global’s expansion and strategy shift
Pagano said Red Sea Global currently operates 14 resorts along Saudi Arabia’s Red Sea coast, with plans to expand to 25 by the end of August and 27 by year-end.
The developer is also adjusting its pricing strategy, introducing properties in the $400–$500 per night range after earlier criticism that initial ultra-luxury offerings—priced at around $2,000 per night—were too exclusive.
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He emphasized that Red Sea Global’s delivery success has been driven by an internalized development model rather than reliance on external contractors.
“We did it differently,” Pagano said. “I didn’t want to follow the business-as-usual model, which was to bring in third parties. We built capabilities. We retained the knowledge.”
He added that while external contractors can support delivery, they often leave once projects are complete, taking expertise with them.
Broader recalibration of Vision 2030 megaprojects
The transfer of Sindalah also reflects a broader recalibration within Saudi Arabia’s Vision 2030 agenda, as authorities prioritize projects with clearer delivery timelines and financial returns.
Other flagship developments have been scaled back or delayed, including NEOM’s The Line—originally envisioned as a 170-kilometer linear city, now significantly reduced in scope and no longer expected to be completed by 2030.
Similarly, construction on the Mukaab, a massive cube-shaped structure planned for central Riyadh, has been paused as the kingdom reassesses large-scale capital commitments.
Pagano’s growing role within the kingdom’s development ecosystem underscores his influence; he was granted Saudi citizenship last year in recognition of his work on major tourism projects.
As Red Sea Global prepares to take control of Sindalah, the focus now shifts to whether the company can turn one of Saudi Arabia’s most criticized luxury developments into a viable destination.
Source: Reuters
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