To meet the tourism objectives of Middle Eastern destinations, it’s crucial to have affordable accommodation options. That’s where short-term rentals come into play.
The agreement also provides Silkhaus access to an additional multi-million dollar credit line to support its expansion plans, according to a release.
While Silkhaus is not revealing the specific amount of the funding round, they told Skift that the funds will be utilized for expanding in current markets such as Dubai and Abu Dhabi and to enter new markets like Riyadh. Additionally, the startup also looks to expand supply.
Founded in 2021, Silkhaus had raised $7.75 million from global investors in 2022, in what was then said to be one of the largest seed rounds in the history of the Gulf region.
Silkhaus anticipates its market opportunity to grow to $18 billion by 2026, across Middle East and North Africa, South Asia and Southeast Asia.
Expansion Into Saudi Arabia
The short-term rental platform entered Abu Dhabi last year and will soon be expanding to Riyadh. Silkhaus announced the appointment of Sabine El Najjar as the founding general manager of Saudi Arabia in September last year.
“As Saudi nationals invest in the kingdom’s real estate sector, we are keen to partner with them, and help them to successfully monetize their assets,” Aahan Bhojani, founder and CEO of Silkhaus, had told Skift about the expansion.
Bhojani said Silkhaus has grown by 120% over the past 12 months, adding: “We are thrilled to partner with the Partners for Growth team as we begin scaling Silkhaus across the Gulf Cooperation Council (GCC) with a diversified capital stack and investor base.”
Middle East’s Short-Term Rental Market
Skift has in its Megatrends this year highlighted how the short term rental market in the Middle East is set for a boom as the region’s lofty tourism goals mean a re-think in accommodations. Luxury hotels won’t be enough.
In a previous conversation with Skift, Bhojani had emphasized the United Arab Emirates’ establishment of regulatory frameworks and objectives that foster a thriving short-term rental ecosystem. “This is generating interest not only from landlords on the supply side but also from customers on the demand side,” he said.
Discussing the recent regulatory changes across all the emirates of the UAE, Bhojani highlighted how these measures have greatly simplified the holiday home rental process.
This he said aligns with the UAE’s ambitious goal of hosting 40 million tourists by 2030 and contributing $123 billion to the national gross domestic product (GDP).
“This shift reflects the growing interest of regulators in expanding short-term rental options, catering to both tourism and mid-term stays,” he said.