Real Estate & Construction
From The Report: Saudi Arabia 2018
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After a period of stabilisation in which the government implemented a number of reforms, the real estate and construction sectors are preparing for the introduction of a range of projects under the Saudi Vision 2030 initiative. Lower oil prices and the resulting fiscal consolidation of the state cooled demand in 2016 and early 2017; however, public and private investment is set to pick up again and the implementation of the NTP and Vision 2030 will have a huge impact on the construction industry if its planned mega-projects are rolled out according to schedule. Increased demand should stem from a growing range of segments, including affordable housing, transport, tourism and commercial space for international tech developers.

This chapter contains interviews with Majed Al Hogail, Minister of Housing; and Khalid S Aljasser, CEO, Arabian Centres.

Articles from this Chapter

Overview

Turning a page: Building activity picks up as the state launches new projects
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After a period of stabilisation in which the government implemented a number of reforms, the real estate and construction sectors are preparing for the introduction of a range of projects under the Saudi Vision 2030 initiative. Lower oil prices and the resulting fiscal consolidation of the state cooled demand in 2016 and early 2017; however, public and private investment is set to pick up again, with transport, affordable housing and tourism programmes among the key priorities. Recent Pressure The…

Analysis

Catalyst for growth: Introduction of a white land tax is expected to engender a more active real estate market
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Perhaps the most significant regulatory enactment for the Kingdom’s construction and real estate players in years, the white land tax is expected to have a wide-ranging impact on the market. Instituted to encourage sales of land to more active developers, the government began issuing its first bills for taxable land in late March 2017. The tax – an annual levy of 2.5% of the value of undeveloped land in plots larger than 10,000 sq metres – is initially being applied to areas designated…

Interview

Keeping current: Majed Al Hogail, Minister of Housing, on strengthening construction and finance models to better serve the Kingdom
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Interview: Majed Al Hogail To what extent can better use of building technologies improve the Kingdom’s housing projects? MAJED AL HOGAIL: Advanced building technologies and innovation can have a substantial impact on the sector by reducing the cost of home ownership, and the quality, sustainability and speed of construction. Globally, construction technologies have evolved from traditional on-site construction to off-site production, and line-based construction to new automated technologies. We…

Interview

Different parameters: Khalid S Aljasser, CEO, Arabian Centres, on the changing face of the commercial real estate market
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Interview: Khalid S Aljasser How will economic diversification impact the growth of real estate projects within and beyond the Kingdom’s main urban centres? KHALID S ALJASSER: Due to various historical and topographical factors, the Saudi economy is mostly concentrated in dense urban environments. These hubs will continue to be central to the Kingdom’s economic activity for the foreseeable future, fuelled by the innovation and change that is set to be led by the country’s swelling urban youth…

Analysis

Suite success: Hotel supply builds up in line with plans to increase tourism
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The year 2017 emerged as a bumper year for new openings in the hotel and leisure segment, as investors prepared for growth in visitor arrivals. Additional building and higher occupancy rates will be driven by efforts to ensure that the Kingdom can host a large number of pilgrims safely, combined with rising business travel as the economy diversifies and government programmes to develop more leisure offerings step up. A record 68 hotels with 29,033 rooms were due to open in Saudi Arabia in…

Analysis

From vision to reality: Investment under Vision 2030 bodes well for construction
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The long-term development plan Saudi Vision 2030 seeks to transform the economy from powerful but hydrocarbons-dependent to diversified, dynamic and knowledge intensive, with a high standard of living for all citizens. One of the most ambitious policy documents published by any country, it is already having an extensive impact on the construction sector. Since its publication in April 2016, the government has rapidly moved ahead with a range of developments and reforms that had an immediate…

Analysis

Large-scale ambitions: Extensive development plans unveiled for western Saudi cities
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After a slower period for developers, 2017 saw a wave of new mega-projects announced in the Kingdom, with cities including Taif, Jeddah, Makkah and Medina set to host new large-scale developments. The emphasis was on providing needed homes for the growing Saudi population and driving further economic diversification, with projects aiming to attract investors in sectors such as tourism, technology and green energy. The biggest announcement of the year came in October 2017 when Crown Prince…