RIYADH: More than 1.3 million homes and 100,000 hotel rooms will be built in Saudi Arabia in the next nine years, according to the global real estate consultant Knight Frank.
The firm has made the prediction after the Kingdom witnessed a tenfold increase in the number of residential mortgages issued in the first half of 2021 compared to the same period in 2016.
Knight Frank has estimated that close to $1 trillion worth of real estate and infrastructure projects have been announced in the wake of the National Transformation Plan, unveiled in 2016.
This is only a third of the total $3.2 trillion of spending that is planned, according to the consultancy firm.
Faisal Durrani, head of Middle East research at Knight Frank, said: “In the national office markets, headline rents were clearly impacted by the pandemic, but rates for the best offices in Riyadh have recovered to pre-pandemic levels and demand is growing rapidly.
“The industrial markets too are expanding at an unprecedented rate as requirements outstrip demand in many locations.”
The first quarter of 2021 has seen the highest ever number of new foreign business investment licenses issued, as the government’s efforts to reshape the economic and real estate landscape drove a sharp upturn in business activity.
Infrastructure building planned in the Kingdom includes 8 giga projects and new super cities, including the $500 billion NEOM and the $20 billion Diriyah Gate luxury neighbourhood in Riyadh.
Knight Frank’s Harmen de Jong said: “We are beginning to see increased appetite from private sector real estate developers in the form of public-private-partnership initiatives with large scale government led projects.
“This is a key trend which will further support the realisation of Vision 2030.”