Sky-high architecture shows Kingdom's business ambitions

Arab News

24-05-2025

RIYADH: Skyscrapers are transforming Riyadh's skyline, signaling a bold shift in the capital's urban and economic ambitions. From finance to high-end living, vertical development is accelerating, drawing comparisons to global cities such as New York.
Riyadh's skyline is rapidly evolving, with high-rises, luxury towers, and smart skyscrapers rising from the King Abdullah Financial District to North Riyadh.
This vertical sprint isn't just aesthetic, it's strategic. Vision 2030, economic diversification plan, is at the heart of this real estate evolution. It seeks to double Riyadh's population and rebrand it as one of the world's top 10 global city economies.
Verticality is the new normal
According to the Real Estate and Municipalities Lead Partner at PwC Middle East Imad Shahrouri, Riyadh's upward push is 'a natural response' to the city's transformational ambitions.
'We're seeing landmark real estate initiatives unlock new mixed-use districts, while the influx of more than 180 multinational headquarters is generating strong demand for premium commercial and residential towers,' he told Arab News.
According to a report by Knight Frank, Riyadh's population is projected to grow from 7 million in 2022 to 9.6 million by 2030.
To accommodate this change, the city will need approximately 305,000 new housing units for Saudi nationals between 2024 and 2034.
The growth is fueled by a compound annual rate of 4.1 percent, and Riyadh's expatriate population is expected to swell to 5.5 million by 2030.
Much of this demand stems from the Kingdom's need for skilled workers to manage giga-projects, new headquarters, and infrastructure rollouts.
These figures underscore just how essential vertical development has become. Riyadh isn't just planning up — it has to build up to meet the city's rapidly evolving demographic and economic realities.
Developers are building vertically to capitalize on land and offer walkable, integrated live-work-play spaces that align with global urban trends.
Imad Shahrouri, Real Estate and Municipalities Lead Partner at PwC Middle East
Shahrouri said: 'These developments aren't happening in isolation; they're supported by significant investment in public transit and metro infrastructure, which is accelerating the shift toward more connected, transit-oriented urban nodes.'
In a city where land prices are soaring and lifestyle expectations are shifting, vertical living is more than a trend, it's financially viable.
The appeal is not just in height but also in smart density. Developers are building vertically to capitalize on land and offer walkable, integrated live-work-play spaces that align with global urban trends, Shahrouri explained.
High-rise hype and high-stakes investing
Luxury towers are fast becoming Riyadh's new skyline signature, and investors are taking notice.
From branded residences to environmental, social, and governance-compliant office towers, high-spec developments are increasingly viewed as strategic plays in a maturing market.
'We're also seeing a shift in tenant expectations,' Shahrouri said.
He added: 'Corporates are moving away from older stock in favor of smart, flexible spaces that support hybrid work models and sustainability goals. This is accelerating interest from institutional investors and REITs, who are drawn not just by the potential returns but by a maturing, more transparent market environment.'
Shahrouri cautions that valuation volatility in speculative zones and execution risks, like supply chain disruptions or limited contractor capacity, are factors investors must watch closely. Still, with robust local partnerships and regulatory alignment, the upside potential remains high.
A shift in the mindset
Arthur Neron-Bancel, principal at Oliver Wyman's Government and Public Institutions practice, calls Riyadh's vertical growth a reflection of deeper socio-economic shifts.
'There is a global trend toward higher-density mixed-use urban developments offering integrated 'live-work-play' environments. Both Saudis and expatriates now expect spaces that align with international standards,' Neron-Bancel told Arab News.
He continued: 'Demographic shifts among Saudis, such as smaller family sizes and later marriages, along with increased migration to Riyadh from other cities, contribute to increased demand for apartments or townhouses.'
Neron-Bancel noted that skilled expatriates, drawn by major government-led initiatives, are contributing to rising demand for new residential formats such as executive housing and apartments.
With projects like Expo 2030 and the 2034 FIFA World Cup on the horizon, he said, investors are expecting that demand to remain strong for several years.
Beyond just demographic drivers, he noted the regulatory and structural shifts behind Riyadh's vertical real estate momentum.
'Recent regulatory reforms, primarily driven by the Royal Commission for Riyadh City, Real Estate General Authority, and Riyadh Amanah, have played a significant role in facilitating high-rise mixed-use developments,' he said.
Neron-Bancel added that key initiatives include the Wafi program for off-plan sales to aid developer financing, the Strata law supporting shared ownership and homeowner associations, and the Ejar program standardizing rental markets.
That strategy includes stronger investor protections, clearer permitting pathways, and a deliberate push toward mixed-use verticality.
Architectural shift
Vertical expansion is prompting new questions around urban identity, density, and the kinds of spaces cities should create for people to live, work, and thrive.
For some, this transformation signals a redefinition of what it means to be a modern capital.
Sachin Kerur, managing partner at international law firm Reed Smith, believes Riyadh's new skyline is as much a cultural transformation as it is an architectural one.
The higher density of development creates higher commercial and residential rental values with enhanced capital appreciation.
Sachin Kerur, mmanaging partner at Reed Smith
'There is a shift in the country's urban development strategy, which is being seen best in Riyadh. Vertical development is gaining more attention than ever,' Kerur told Arab News.
He added: 'The higher density of development creates higher commercial and residential rental values with enhanced capital appreciation. This is driving the appetite for the supply side as investors start to queue for opportunities.'
Kerur explained that the demand side is also being driven by a young demographic wanting modern, affordable and hassle-free accommodation providing the lifestyle opportunities enjoyed in other major cities in the GCC.
Kerur believes Riyadh's real estate boom is a symptom of the Kingdom's infrastructure ambitions, a key ingredient of Vision 2030.
The focus on vertical expansion signals the end of so-called urban sprawl, which is not seen as economically, or environmentally, attractive.
'There is definitely more dialogue in the Kingdom between government, developers, planning professionals, and architects. Urban sprawl is definitely old news,' he said, adding: 'Cities are not judged well on the breadth of their horizontal limits. Today, building up creates better asset yields, reduces footprint and improves the living environment of a city.'
While Kerur acknowledges cultural hesitations, he remains optimistic.
'What Riyadh can now do is to aggregate the best in architectural and engineering talent and practice to create the next generation of innovative vertical living,' he added.
Kerur said that the sustainability advantages of Riyadh's vertical shift will be considerable, particularly through the adoption of modern building materials and design approaches.
However, he noted that urban planners and developers will also need to account for cultural preferences and social attitudes toward high-rise living, which may still be unfamiliar or uncomfortable for many Saudis.
Even so, with a predominantly young population and fast-moving social change, he expects that more young Saudis, along with the growing expatriate community, will gradually embrace this new urban lifestyle.
Identity and investment
Kerur believes it is 'absolutely essential' for Riyadh to have best-of-class, innovative and attractive vertical working and living space — a very clear expectation from the market and users.
When people can live, work, and socialize within the same area — often within the same building or neighborhood — it creates a more efficient, convenient, and productive environment.
This is especially important in cities that aspire to be global business hubs. Commuting long distances for meetings, meals, or leisure activities wastes time, adds stress, and contributes to traffic congestion.
In contrast, compact, mixed-use developments reduce the need for constant travel, helping professionals and residents make the most of their time.