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Market overview:

Saudi Arabia’s real estate market is set to experience robust growth through 2025, fueled by the Kingdom’s Vision 2030 reform agenda and commitment to economic diversification. Key developments, including 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.

Although the Kingdom witnessed a decline in Foreign Direct Investment (FDI) inflows during Q1 – Q3 2024, dropping approximately SAR 14.7 billion compared to the same period in 2023, the outlook remains optimistic. The National Investment Strategy projects FDI inflows to reach SAR 388 billion by 2030, reflecting a 22% compound annual growth rate (CAGR) from the 2023 figure of SAR 95.9 billion. Favourable regulatory reforms aimed at attracting global investors are expected to drive demand across the residential, retail, commercial, and hospitality sectors.

Key market trends shaping the sector include:

• The rise of sustainable and smart developments

• Increased demand for luxury and mixed-use properties

• A growing emphasis on affordable housing to support Saudi Arabia’s expanding population

Hospitality:

Riyadh and Jeddah’s Seasonal Events, organized by the Entertainment Authority, have significantly boosted domestic and international tourism, strengthening Saudi Arabia’s position as a global tourism destination.

Residential

Property transaction volumes and values have maintained an upward trend in 2024, supported by economic expansion and population growth. This increasing demand for housing, particularly in major cities like Riyadh and Jeddah, is expected to sustain price appreciation and rental growth.

Offices

Riyadh continues to solidify its position as Saudi Arabia’s primary business hub, supported by government initiatives that enhance business accessibility and attract foreign investment. Demand for grade-A office spaces remains high, with companies prioritizing strategic locations in the capital’s financial districts.

Retail

According to Oxford Economics, retail sales in Saudi Arabia are projected to grow at a CAGR of 4.4% between 2025 and 2027. Increasing urbanization, rising disposable incomes, and a shift towards experiential retail concepts are expected to drive long-term sector growth.

Industrial & Logistics

Saudi Arabia’s strategic vision continues to bolster growth in the industrial and logistics sectors, backed by government investments, infrastructure development, and international trade expansion. The demand for industrial warehousing and logistics hubs is expected to remain strong across key economic zones.

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