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Arabian Business
31-03-2025
- Business
- Arabian Business
Saudi Arabia real estate sector set for robust expansion in 2025: Report
Saudi Arabia's real estate market is positioned for substantial growth in 2025, driven by Vision 2030 and strategic economic diversification, according to a comprehensive market review by JLL. The Kingdom's non-oil sector is projected to grow by 5.8 per cent in 2025, up from 4.5 per cent in 2024, underpinned by significant infrastructure investments and private sector engagement. 'Despite global economic headwinds, the resilience and strategic diversification efforts in Saudi Arabia driven by Vision 2030 are a significant catalyst for real estate development, attracting both domestic and international capital. The flight to quality, limited vacancy in prime assets, and ambitious tourism strategies are further bolstering sustained demand across key sectors, particularly in Riyadh and Jeddah, creating a compelling investment landscape for the long term,' Saud Alsulaimani, Country Head of JLL in Saudi Arabia said. Construction remains a robust sector, with Saudi Arabia accounting for $29.5 billion in project awards in 2024. Diversification fuels real estate The hospitality, mixed-use, and leisure segments demonstrated significant activity, with the residential sector securing $7.9 billion in awards. Riyadh's office market emerged as a standout performer, with Grade A buildings registering a mere 0.2 per cent vacancy and average rents reaching $609 per square metre in Q4 2024. The city anticipates an additional 888,600 sq m of office space in its pipeline for 2025. The residential sector continues to show strength, with villas comprising 53.3 per cent of total transactions in Riyadh. Jeddah's market sees apartments dominating, representing 82.8 per cent of anticipated units for 2025. Hospitality sectors in Riyadh and Jeddah are experiencing growth, driven by corporate tourism, global events, and religious tourism. Riyadh's Average Daily Rates surged 13.3 per cent to $239 in 2024, with 2,312 new hotel keys expected in 2025. Retail landscapes are transforming, with a shift towards experiential formats. Open-air boulevard-type retail is gaining popularity, while traditional mall concepts face challenges. Community malls showed a 5.5 per cent growth, contrasting with regional malls experiencing a 9.3 per cent annual decline. The industrial and logistics sectors demonstrate strong market activity, with upward rental rates in both Riyadh and Jeddah. This growth is fuelled by economic diversification and e-commerce expansion. 'Strategic projects that underpin Saudi Arabia's Vision 2030 will continue to attract substantial investments, creating new opportunities for market expansion. Significant cash flow is anticipated for major events like the FIFA World Cup 2030 and EXPO 2030, further boosting infrastructure development and positioning the real estate sector for robust performance and positive growth in 2025 and beyond,' Maroun Deeb, Head of Projects and Development Services for JLL in KSA added. The data centre landscape is also expanding, with Saudi Arabia ranking third in live colocation facilities and contributing 12.6 per cent of the region's operational IT load capacity by 2024's end. As the Kingdom prepares for major events from 2025 to 2028, it continues addressing challenges through localisation efforts, infrastructure investment, digital transformation, and a focus on sustainability.
Arab News
27-03-2025
- Business
- Arab News
Saudi Arabia's real estate market to reach $101.62bn by 2029
RIYADH: Saudi Arabia's real estate sector is expected to experience growth in 2025, fueled by the ongoing efforts of Vision 2030 to diversify the Kingdom's economy, according to a recent analysis. In its latest report, real estate services firm JLL highlighted that economic growth across the Gulf Cooperation Council is expected to remain strong in 2025, with Saudi Arabia leading the charge. The Kingdom's non-oil sector is projected to expand by 5.8 percent in 2025, an increase from 4.5 percent in 2024. JLL also noted that Saudi Arabia's construction sector continued to perform well in 2024, with project awards totaling $29.5 billion. A strong real estate market is critical for the Kingdom as it works to position itself as a global hub for tourism and business, reducing its long-standing dependence on oil revenues. The Real Estate General Authority of Saudi Arabia forecasts the property market to reach $101.62 billion by 2029, with a compound annual growth rate of 8 percent starting in 2024. Saud Al-Sulaimani, country head of JLL, Saudi Arabia, said: 'Despite global economic headwinds, the resilience and strategic diversification efforts in Saudi Arabia, driven by Vision 2030, are a significant catalyst for real estate development, attracting both domestic and international capital.' He added: 'The flight to quality, limited vacancy in prime assets, and ambitious tourism strategies are further bolstering sustained demand across key sectors, particularly in Riyadh and Jeddah, creating a compelling investment landscape for the long term.' According to the report, the hospitality, mixed-use, and leisure sectors saw substantial activity, while the residential sector also performed strongly, with $7.9 billion in awards in 2024. JLL pointed out several challenges faced by Saudi Arabia's real estate sector, including capacity constraints, rising costs, and geopolitical conflicts. The report emphasized that the Kingdom is tackling these challenges through increased localization efforts, ongoing infrastructure investment, and digital transformation. Additionally, regulatory reforms, improved stakeholder collaboration, and a focus on renewable energy and sustainability are key strategies to overcome these obstacles. 'Strategic projects that underpin Saudi Arabia's Vision 2030 will continue to attract substantial investments, creating new opportunities for market expansion,' said Maroun Deeb, head of projects and developments for JLL in Saudi Arabia. He added: 'Significant cash flow is anticipated for major events like the FIFA World Cup 2030 and EXPO 2030, further boosting infrastructure development and positioning the real estate sector for robust performance and positive growth in 2025 and beyond.' In 2024, Riyadh's office sector witnessed strong demand, while limited supply saw Grade A buildings registering a mere 0.2 percent vacancy. The analysis added that average rents for Grade A office spaces stood at $609 per sq. meter by the end of the fourth quarter of 2024. Grade A office spaces command a premium due to their prime location, infrastructure, and modern amenities. JLL revealed that 326,000 sq. meters of gross leasable area was added to the market in 2024, while 888,600 sq. meters are awaiting in the pipeline in 2025. 'Jeddah is emerging as a compelling alternative, attracting regional and international corporations to its modern, high-quality office spaces in the northwestern region. Dammam's market remains stable, primarily driven by government entities,' added JLL. In Riyadh's residential sector, villas continued to dominate, accounting for 53.3 percent of the overall transactions. Even though 28,943 units are slated for 2025 in Riyadh, new supply lags will likely drive price and rental increases. According to JLL, Riyadh's hospitality industry witnessed significant growth in 2024, with average daily rates surging by 13.3 percent year on year to $239. The report added that Riyadh's growth as a key business and leisure hub will continue, with 2,312 keys expected in 2025. 'As Saudi Arabia progresses with its Vision 2030 objectives, Riyadh's hospitality market is likely to play a crucial role in supporting the Kingdom's broader economic goals and establishing itself as a key destination for both business and leisure travelers in the region,' said JLL. Jeddah's hospitality landscape, bolstered by religious and leisure tourism, also remained strong in 2024. The report added that upward rental rates in Riyadh and Jeddah's industrial and logistics sectors indicate strong market activity and robust demand for enhanced logistics and warehousing capabilities. Regarding the data center landscape, JLL said that 5G and artificial intelligence are driving the segment's growth. 'Saudi Arabia, particularly Riyadh, Dammam, and Jeddah, boasts a significant data center footprint. The Kingdom ranks third in live colocation data center facilities and contributed approximately 12.6 percent of the region's 1,050 MW operational IT load capacity by the end of 2024, positioning it well for further expansion,' concluded JLL.
Zawya
03-03-2025
- Business
- Zawya
Residential sales in Saudi Arabia reach SAR 118bln in 2024, signalling robust real estate growth
Residential transactions across Riyadh, Jeddah and Dammam Metropolitan Area touched SAR 118 billion (USD 32 billion) in 2024; a 50% increase compared to 2023 Grade A office-focused sectors in the Kingdom, such as financial and business services, experienced a growth of 5.3% between 2023 and 2024 Hospitality sector continues to thrive, with ADR reaching SAR 726 in 2024, having already surpassed the goal of 100 million tourists, seven years ahead of schedule Riyadh, Saudi Arabia: Deloitte, the leading global professional services firm, has released its annual KSA real estate market review, highlighting another strong year for the Kingdom across all sectors. According to the report, Saudi Arabia's real estate market is set to experience robust growth through 2025, fuelled by the Kingdom's Vision 2030 reform agenda and commitment to economic diversification. Key developments, including major events like EXPO 2030 and the FIFA World Cup 2034™, alongside giga-projects such as NEOM, the Red Sea, and Qiddiya, are expected to drive the creation of new urban hubs and tourism destinations. The outlook remains optimistic with the National Investment Strategy projecting FDI inflows to reach SAR 388 billion (USD 103.4 billion) by 2030, reflecting a compound annual growth rate (CAGR) of 22% from the 2023 figure of SAR 95.9 billion (USD 25.5 billion). Oliver Morgan, Partner and Head of Real Estate at Deloitte Middle East, commented: 'Saudi Arabia's real estate sector is experiencing robust growth, driven by strategic government initiatives, strong economic fundamentals, substantial infrastructure investments and expanding international trade. These diverse growth drivers position Saudi Arabia as one of the region's most dynamic and promising real estate markets. Sustainable and smart developments, increasing demand for luxury and mixed-use properties, and a growing focus on affordable housing to serve the Kingdom's expanding population have caused residential transactions to rise steadily. Riyadh continues to solidify its position as the primary business hub, attracting significant foreign investment.' Market performance overview Residential Fuelled by Saudi Arabia's economic expansion and population growth, transaction volume and value across Riyadh, Jeddah and Dammam Metropolitan Area (DMA) for residential real estate increased steadily by approximately 50% between 2023 and 2024, growing with residential supply. This reflects the increasing market maturity and the planned phasing approach adopted by developers. According to the Deloitte report, the total number of residential transactions across Riyadh, Jeddah and DMA reached 102,522 in 2024, with a total value of SAR 118 billion (USD 32 billion). Sales rates in Riyadh increased by 5% for apartments and 12% for villas, while apartments in Jeddah and DMA experienced growth of approximately 1% over the past 12 months. In Riyadh, approximately 69% of apartments sold in the last 12 months were priced between SAR 250,000 and SAR 1 million, (USD 66,000 to USD 266,000), primarily targeting the low to mid-income segments. Office market With Saudi Arabia's GDP reaching SAR 3 trillion (USD 786 billion) in 2024 and forecasted to grow to SAR 3.7 trillion (USD 981 billion) by 2030 – a CAGR of 3.4% over the same period – demand for office space remains strong. Grade A office-focused sectors, such as financial and business services, experienced a growth of 5.3% between 2023 and 2024. Office supply in Riyadh, Jeddah and DMA stood at 6.4 million sqm, 2.2 million sqm, and 1.5 million sqm, respectively at the end of 2024. Notable developments include Laysen Valley, STC Square Phase 1, and the New East project in Riyadh, added a total gross leasable area (GLA) of 145,000 sqm. A significant portion of the King Abdullah Financial District (KAFD) office supply was also successfully delivered, reflecting high pre-leasing and leasing rates. In Jeddah, an additional 150,000 sqm GLA was delivered encompassing projects like JCDC and Darb Al Haramain. The Regional Headquarters Program, launched in Q1 2024, resulted in 571 companies relocating to Riyadh by the end of the year. The Saudi government also introduced tax breaks, streamlined regulations, and broke ground on several large-scale projects, including New Murabba and Diriyah Gate, expected to offer extensive office space upon completion. Hospitality Saudi Arabia's hospitality sector continues to thrive, with the Average Daily Rate (ADR) increasing to SAR 716 in 2024, up from SAR 702 in 2023. This was boosted by the Kingdom surpassing the Vision 2030 goal of 100 million tourists a year, seven years ahead of schedule. Riyadh, specifically, has outperformed global cities like Hong Kong, Madrid and Dubai, with ADR climbing to SAR 895 in 2024. This surge has been attributed to the ongoing strength of corporate and leisure demand and the successful Riyadh Seasons event, which stimulated domestic and international tourist inflows. Jeddah's market remains a critical tourism gateway. The coastal city's ADR stood at SAR 680, and new developments along the waterfront are expected to strengthen market performance as tourism initiatives ramp up ahead of global events like Expo 2030 and FIFA World Cup 2034. Saudi Arabia's hospitality sector's growth is further fuelled by cultural and entertainment investments, including efforts to revitalize Saudi Arabia's heritage landmarks and introduce new attractions such as AlUla and the New Murabba project. Giga-projects like NEOM and Amaala promise to elevate the hospitality market. Retail Oxford Economics estimates that total retail sales volume in KSA will experience continued growth at a CAGR of 4.4% between 2025 and 2027. The development of retail assets which offer integrated entertainment and immersive experiences continues to be a key focus for retail operators throughout the Kingdom, as customer preferences continue to evolve, moving away from traditional standalone retail developments. Throughout 2024, retail rents in Saudi Arabia increased marginally due to a high volume of supply and relatively stable demand. Older retail developments are struggling as newer developments with more diverse offerings are capturing market share. The Deloitte report also highlights the growing trend of pop-up stores – temporary retail spaces that create a unique customer experience and drive brand awareness. In KSA, this trend is gaining traction in major retail malls, offering a dynamic addition to the traditional retail landscape. Industrial & Logistics The growth in demand in the warehousing and logistics sector is primarily attributed to various initiatives and incentives deployed as part of the 2030 Vision, including the National Industrial Development and Logistics program, Special Economic Zones such as Riyadh Integrated Logistics Zone, Saudi Port Authority initiatives enhancing port infrastructure in Jeddah & DMA, and the Vision 2030 logistics master plan. Demand for warehousing and logistics will continue growing due to the enhancement of the aviation infrastructure and increase in air cargo. Based on statistics from the Saudi Port Authority, cargo throughout increased by 14% in 2024 compared to 2023. The report features also an analysis on the development approaches to successfully deliver major sports assets, the current KSA tax context with a Real Estate focus, and how the mortgage market has evolved in KSA. For full insights and detailed market analysis, access the full report here. -Ends- © 2025 Deloitte & Touche (M.E.). All rights reserved. In this press release references to 'Deloitte' are references to one or more of Deloitte Touche Tohmatsu Limited ('DTTL') a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see for a detailed description of the legal structure of DTTL and its member firms. The information contained in this press release is correct at the time of going to press. About Deloitte & Touche (M.E.) LLP: Deloitte & Touche (M.E.) LLP ('DME') is the affiliate for the territories of the Middle East and Cyprus of Deloitte NSE LLP ('NSE'), a UK limited liability partnership and member firms of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ('DTTL'). DME is a leading professional services organization established in the Middle East region with uninterrupted presence since 1926. DME's presence in the Middle East region is established through its affiliated independent legal entities, which are licensed to operate and to provide services under the applicable laws and regulations of the relevant country. DME's affiliates and related entities cannot oblige each other and/or DME, and when providing services, each affiliate and related entity engages directly and independently with its own clients and shall only be liable for its own acts or omissions and not those of any other affiliate. DME provides audit and assurance, consulting, financial advisory, risk advisory and tax, and legal services through 23 offices in 15 countries with more than 7,000 partners, directors and staff. About Deloitte: Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited ('DTTL'), its global network of member firms, and their related entities (collectively, the 'Deloitte organization'). DTTL (also referred to as 'Deloitte Global') and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm sand related entity is liable only for its own acts and omissions, and not those of each other. DTTL, NSE and DME do not provide services to clients. Please see to learn more. Deloitte provides industry-leading audit and assurance, tax and legal, consulting, financial advisory, and risk advisory services to nearly 90% of the Fortune Global 500® and thousands of private companies. Our professionals deliver measurable and lasting results that help reinforce public trust in capital markets, enable clients to transform and thrive, and lead the way toward a stronger economy, a more equitable society and a sustainable world. Building on its 175-plus year history, Deloitte spans more than 150 countries and territories. Learn how Deloitte's approximately 457,000 people worldwide make an impact that matters at Contact: Bassel Barakat External Communications |PR and Media Lead Deloitte Middle East Email: bbarakat@ |
Leaders
19-02-2025
- Business
- Leaders
Saudi Media Forum 2025 Kicks Off in Riyadh
The fourth edition of the Saudi Media Forum has kicked off in Saudi Arabia's capital, Riyadh, reported the Saudi Press Agency (SPA). On Wednesday, the Saudi Media Minister, Salman Al-Dossary, inaugurated the Saudi Media Forum 2025, in the attendance of the Saudi Minister of Energy, Prince Abdulaziz bin Salman, and the former UK Prime Minister, Boris Johnson. Under the theme 'Media in an Evolving World,' the forum runs from February 19-21, 2025, bringing together top decision-makers, experts and talents in the media industry from around the world to discuss how media can leverage digital transformation to achieve sustainable growth. Saudi Media Minister In his opening remarks, Al-Dossary highlighted the media role in showcasing Saudi Arabia's success across various fields, under Vision 2030, and shaping the future of humanity. Since 2024, the Kingdom has received 24 world leaders who contributed to shaping the future. It has also hosted more than 15,625 events and conferences with over 42 million attendees, an average of about 2 events per hour throughout the year, Al-Dossary said. The Saudi Media Minister pointed to the Kingdom's influential role as a hub for hosting major events such as EXPO 2030 which will redefine innovation and FIFA World Cup 2034 which will transform sport experience into an interesting story supported by AR and smart broadcasting technologies. Prince Abdulaziz bin Salman Moreover, Al-Dossary said that the media sector will create around 150,000 jobs by 2030, fostering talent and accelerating innovation. He also noted that Saudi Arabia has begun to achieve the aspirations of the Year of Impact 2025 by setting clear priorities. These include developing a strategy for non-profit media, social responsibility, and volunteering; organizing an international conference for the future of news to solidify SPA's global status; completing the digitalization of SPA's historic archive; and establishing a laboratory for AI and emerging technologies in media. Short link : Post Views: 33
