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RIYADH: Five investment contracts worth SR1.5 billion ($400 million) were signed by Al-Ahsa municipality to advance a series of development and service projects across the region.   

The agreements, concluded in the presence of Al-Ahsa Gov. Prince Saud bin Talal and Minister of Municipal and Rural Affairs and Housing Majed Al-Hogail, are intended to enhance municipal services and improve quality of life for residents, the Saudi Press Agency reported.  

The deals cover the development of the Jabal Abu Hsais tourist resort, the construction of a vehicle appraisal center, and the establishment of a periodic vehicle inspection facility. They also include the redevelopment of the King Abdullah Cultural Center and the creation of a date processing factory in Al-Ahsa. 

These projects are part of broader efforts to diversify the local economy and attract investment into the governorate, highlighting the strategic importance of the Al-Ahsa region, which spans approximately 379,000 sq. km — about 20 percent of ������Ƶ’s total land area. 

Prince Saud stated that these projects represent a fundamental pillar in the region’s comprehensive development strategy, aligning with the leadership’s aspirations to strengthen sustainability in the implementation of strategic plans and to make optimal use of Al-Ahsa’s cultural and economic resources, according to the SPA report.   

In addition to the investment contracts, Al-Ahsa municipality signed three memoranda of understanding to implement 11 projects focused primarily on establishing parks and urban enhancements under the “Bahja” project and the Saudi Green Initiative.  

The National Housing Co. committed to building eight parks in various locations across Al-Ahsa.   

Retal Urban Development, represented by the chief operating officer Yousef Al-Hamoudi, agreed to develop two parks in Al-Badriya district of Hofuf, while Abdullah Al-Abdulqader, board member at Imam Abdulrahman Bin Faisal University, pledged to fund a 2,000-sq.-meter park in Al-Asima neighborhood.  

Al-Ahsa Mayor Essam Al-Mulla explained that the agreements form part of the municipality’s objectives to serve the community, deliver projects and initiatives that advance development, and establish integration between public and private sectors in pursuit of sustainable growth consistent with Saudi Vision 2030, according to the SPA report.   

During the signing ceremony, Prince Saud and the minister inaugurated the “Al-Ahsa: Future and Development” exhibition, which showcased municipal services, infrastructure projects, and quality of life initiatives.   

They also handed over residential units to beneficiaries of the developmental housing program in Al-Ahsa.  

Building on these initiatives, Al-Ahsa also witnessed a sharp rise in tourism in 2024, with visitor numbers increasing by 500 percent to reach 3.2 million. As a result, total tourist spending exceeded SR3.3 billion, marking a 400 percent increase compared to 2019. These figures highlight the region’s growing appeal and underscore the impact of continued investment in infrastructure and services. 

RIYADH: ������Ƶ’s construction output value is expected to reach $191 billion in 2029, representing a rise of 29.05 percent compared to 2024, according to an analysis. 

In its latest report, global consulting firm Knight Frank pointed to the growth in residential developments, the ongoing giga-projects, and increased demand for office space — particularly in Riyadh — as the key drivers for this rise.

The Kingdom aims to deliver over 1 million homes, more than 362,000 hotel keys, over 7.4 million sq. meters of retail coverage, and more than 7.7 million sq. meters of new office space by the end of this decade as part of its Vision 2030 economic diversification drive. 

������Ƶ’s Real Estate General Authority expects the property market to reach $101.62 billion by 2029, with an anticipated compound annual growth rate of 8 percent from 2024.

Knight Frank’s forcast comes after the output value for the construction, transport, and power sectors, as well as those covering oil and gas, industrial, water, and chemical, in the Kingdom expanded by 4.6 percent year on year in 2024, reaching $148 billion. 

The anticipated growth in the Kingdom’s construction output value also aligns with the broader trend observed in the GCC region, where countries are pursuing their economic diversification efforts. 

“Construction contracts totaling more than $215.4 billion were awarded across ������Ƶ between 2020 and 2025, highlighting the government’s incredible ambition and commitment to making the Kingdom the center of wealth generation and trade not just in the GCC (Gulf Cooperation Council) but globally,” said Faisal Durrani, partner, head of research of Knight Frank in the Middle East and North Africa. 

He added: “Indeed, some $1.3 trillion is planned to be invested in real estate and infrastructure projects as part of Vision 2030, highlighting the breadth and scale of what is now being delivered.” 

According to the report, the total real estate development value for the Western Region accounts for 53 percent of the total in this $1.3 trillion development plan.

In May, a report released by Research and Markets projected that the construction market in the UAE is expected to expand at a compound annual growth rate of 4.8 percent from 2025 to 2029, reaching 242.33 billion dirhams ($65.89 billion). 

In June, Research and Markets projected that Qatar’s construction sector is projected to grow at an annual average growth rate of 4.7 percent from 2026 to 2029, supported by public and private sector investments in renewable energy, water infrastructure and liquefied natural gas projects.

In February, speaking at the Public Investment Fund Private Sector Forum in Riyadh, Fahad Al-Hashem, assistant deputy minister at the Ministry of Investment, said that ������Ƶ’s construction sector saw significant growth in 2024, with 3,800 new licenses added in just one year to bring the total to 8,900.

According to the latest Knight Frank report, Riyadh remains the center of construction activity, with $135.2 billion of contracts awarded since 2020, representing 63 percent of the total across the Kingdom. 

The $195 billion development plan for Riyadh envisions 4.6 million sq. meters of office space, 2.6 million sq. meters of retail, more than 28,800 hotel rooms, and over 340,000 residential units.

Knight Frank added that the total value of commissioned projects in Riyadh stands at $35 billion. 

The analysis also discussed Riyadh’s rapidly developing transport system, which includes the Riyadh Metro project, featuring six lines spanning 176 km with 85 stations and fully automated, driverless trains. 

Knight Frank stated that the King Abdulaziz Public Transport Project in the capital will create a comprehensive bus rapid transport system, while more than $5 billion is being spent on major road projects to support the city’s expansion.

“With the population of Riyadh projected to increase to 10 million by 2030, the city’s transport upgrade program is one of the largest and most innovative in the world,” said Mohamed Nabil, regional partner, head of project and development services, Knight Frank, MENA. 

He added: “Although the car is still the dominant form of transport, the investments being made in Riyadh’s Metro and rapid transport system show how the city is redefining the urban experience through sustainable development to create not only a liveable city, but also an attractive destination for business and tourism.” 

In June, a separate report released by Knight Frank highlighted the growth of Riyadh as a commercial hub.

According to that analysis, the rents for Grade A office spaces in the Kingdom’s capital reached SR2,700 ($719.95) per sq. meter, marking a year-on-year rise of 23 percent, driven by the success of government-led initiatives, including the ambitious regional headquarters program.

That initiative offers benefits to international firms, including a 30-year exemption from corporate income tax and withholding tax on headquarters activities, as well as discounts and support services.

In the latest report, Amar Hussain, associate partner — research Middle East at Knight Frank, said that giga-projects in the Kingdom are emerging as a major hub for construction activities. 

“The $50 billion New Murabba project will transform 19 sq. km of north-west Riyadh, creating 18 new neighborhoods. In Western ������Ƶ, a $685.5 billion real estate development plan centered on giga projects will deliver more than 382,000 homes, 330,000 hotel rooms, and office and retail space spanning upwards of 7.3 million sq. meters,” said Hussain. 

He added: “These projects are designed on a scale far beyond anything else currently under construction in EMEA (Europe, the Middle East and Africa), and this bold vision is rapidly becoming reality, bringing benefits to Saudi residents and businesses alike.”