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Saudi Arabia's $91B Vision Fuels Riyadh Construction Boom
Posted on January 6, 2025 |
The real estate sector in Saudi Arabia is on track to experience significant expansion, driven by Vision 2030 and massive investments in infrastructure and construction projects.
- Market Valuation & Growth Projection
The current value of Saudi Arabia’s construction market is estimated at $70.33 billion. However, this figure is expected to surge to 342.6 billion Saudi riyals ($91.36 billion) by 2029, indicating a strong upward trajectory.
- Key Projects in Riyadh
With ongoing projects valued at over $20 billion, Riyadh is emerging as a major investment hub, supporting the Kingdom’s diversification goals under Vision 2030. The city is set to witness a substantial increase in demand for Grade A office spaces, residential properties, and hospitality services, fueled by mega projects such as Diriyah Gate, King Salman Park, and Expo 2030.
- Hotel Investments on the Rise
Hotel investments in Saudi Arabia are forecast to grow by 30% by 2025, a critical factor in achieving the nation’s target of attracting over 150 million visitors annually by 2030. Tourism and business activities are transforming Riyadh's hospitality sector, aiming to make the guest experience more sustainable and innovative.
Market Momentum & Future Outlook
Despite a temporary slowdown in the total value of awarded projects, several initiatives have entered the implementation phase, which is expected to accelerate spending in the coming years.
- Emerging Opportunities in New Destinations
While Riyadh and Jeddah lead with their advanced infrastructure and connectivity, emerging destinations such as Abha and AlUla present unique opportunities for sustainable and pioneering hospitality developments. Offering innovative, eco-friendly travel experiences, these cities will redefine Saudi Arabia's tourism landscape.
Expert Insights
“2024 has been a pivotal year for the real estate market in Saudi Arabia, with a strong focus on project evaluation, regulatory improvements and capital structuring, all to further engage the private sector. This synergy between the public and private sectors is accelerating transformational projects that support the Kingdom’s Vision 2030,” said Saud Al Sulaimani, Country Manager, JLL Saudi Arabia.
“Riyadh’s booming tourism and business activity is transforming the city’s hospitality landscape. The focus is shifting towards sustainable practices and cutting-edge experiences to meet the changing expectations of modern travellers,” said Amr Elnady, Managing Director, Hotels & Hospitality, Middle East & Africa.
Conclusion
The real estate and construction sector in Saudi Arabia is set to achieve remarkable growth, underpinned by visionary government initiatives, strategic investments, and the country’s goal to diversify its economy. With Riyadh leading the charge and new destinations emerging, the sector offers promising prospects for both local and international investors.
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