RIYADH: Developmental work is fast gaining pace at Saudi Arabia’s futuristic city NEOM as the giga-project finalized contracts worth SR21 billion ($5.6 billion) to build the first phase of residential communities for the workforce.

In one of the world’s largest public-private partnership deals for social infrastructure, NEOM signed up some of the leading Saudi developers to build 10 communities across the smart city that will accommodate an additional 95,000 occupants upon completion of the first phase. 

According to a press release, the preferred bidders who will invest in developing this first-phase residential project include Alfanar Global Development, Almutlaq Real Estate Investment Co., Nesma Holding Co. and Tamasuk Holding Co.

Tamasuk Holding Co. will be investing in the project through two separate partners — Al Majal Al Arabi Group  Co. and the Saudi Arabian Trade and Construction Co.

The deal goes well with the $500 billion project’s plan for more private sector participation in developing the city’s infrastructure.

“NEOM has selected some of the leading companies in Saudi Arabia as partners in delivering and operating temporary communities with world-leading services and infrastructure,” said Nadhmi Al-Nasr, CEO of NEOM. 

He added: “The newly formed partnerships mark an important milestone for the region and are a testament to the capabilities of our team and partners who rapidly achieved financial close on a record amount.” 

The project owner revealed that the temporary residential projects, used by the workforce during the construction period of NEOM, will be built sustainably, using relocatable modular units which can be repurposed once the communities are no longer needed. 

These residential communities will also include a wide range of lifestyle facilities, including swimming pools, entertainment venues, multi-purpose sports fields, cricket ovals and outdoor courts for other sports.

“We are elated to partner with NEOM on this multi-nodal infrastructure project and to contribute to NEOM’s vision of disrupting the conventional approach to urban living. This is in line with our commitment to deliver high-quality solutions in a sustainable manner,” said Sabah Al-Mutlaq, vice chairman of Alfanar Global Development.

NEOM said the second phase of the temporary residential project is expected to be issued to the market in the coming months as it is reviewing interest from investors with plans to shortlist pre-qualified participants from now.

Mohammed Al-Balwi, chairman of Tamasuk, said: “We are immensely proud to be NEOM’s infrastructure partners. Together with Almajal and SATCO, we are committed to delivering the infrastructure that will facilitate the wider and rapid development of NEOM.”

The giga-project is being developed to attract additional investors for its commercial assets. With the signing of the multibillion-riyal investment, NEOM looks to achieve the project’s goal of having a direct economic impact on the region through developing local competency and creating jobs while advancing the use of sustainable solutions in construction.