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Demand fuels fast pace of Jeddah urban development

Last updated: Monday, February 11, 2013 12:35 AM
Hussain Al- Harthi

JEDDAH – With a solid combination of demographic and economic growth positions, Jeddah is a major center for residential and commercial development projects,” said Hussain Al- Harthi, VP and Managing Director, National Exhibitions Company, ahead of the Cityscape Jeddah 2013 that will take place at the Jeddah Centre for Forums & Events on March 2-4, 2013.

“All demand drivers are in place to sustain growth within the residential market, offering ample opportunities for investors to make attractive returns. Jeddah’s population has doubled over the last 25 years to 3.6 million, and this growing population coupled with limited housing supply is expected to drive prices and sustain demand,” he said.

The Jeddah Urban Development and Real Estate Investment Event - Cityscape Jeddah 2013 is expected to be one of the most unique events, with this year’s inclusion of exciting new features.

In addition to the largest real estate exhibition in Saudi Arabia, being added to its portfolio this year, is the Residential & Affordable Housing Summit, the Hotel Investment & Development Summit and the World Architecture Congress Saudi Arabia, which will provide a wealth of opportunities for various asset classes in the real estate sector. With a market heavily fuelled by domestic consumption, as opposed to future projections in other GCC countries, Saudi Arabia represents a significant hub of opportunities for the local, national and international industry players.

An additional 2 million units, planned to be in place by 2015, is not expected to meet the market demand for housing. With many projects in the supply pipeline and demand likely to remain consistent, the investment in affordable housing will clearly intensify and price increases should satisfy investors.

Riyadh Al-Thagafi, CEO of Ewaan Global Residential Company, said “we have recognized the importance of participating in Cityscape events from the beginning, and have been sponsoring the Jeddah event since it started. We have been utilizing this platform to launch our products in the market and this year we are making use of our presence to launch Phase Three of our flagship project Alfareeda located north of Jeddah. There is extremely high demand for master development projects in Saudi Arabia and this is evident from the huge success in sales we are witnessing of Phase Two, which is almost sold out after only a few months of launching.”

Also commenting on the increase in demand for residential projects, Khalid Telmesani, CEO, Sumou Real Estate, said ”the significant growth that we all have been witnessing in the real estate market in Jeddah, Saudi Arabia and the region, in general has given rise to a niche category of specialized residential development projects. It is for this reason, we are proud to sponsor such a prestigious event as Cityscape Jeddah, which gives developers, such as Sumou the perfect opportunity to showcase some of our major projects at the event.”

He added: “Cityscape is the biggest event of the year for us since it presents a unique opportunity for networking among our peers and to meet investors and other interested parties from across the Kingdom and the region.”

Overviewing another dimension of Cityscape 2013, Al Harthi said “the Residential & Affordable Housing Summit will explore the challenges and opportunities of the residential sector, which will remain a hot spot during 2013 with further opportunities to create more affordable housing products in the future. Moreover, continued growth in real estate financing and private sector lending will give a boost to the overall real estate industry, which is one reason for increased participation of banks and home finance companies during this year’s event.”

Jeddah is much more than an industrial and logistical hub. Service sectors, such as the tourism industry, are expected to thrive. An average growth of 6 percent year-on-year on business and tourist arrivals in the Kingdom, as well as the government’s investment of SR100 billion in infrastructure and transportation projects to increase the capacity for religious tourism, should facilitate this trend.

Al-Harthi said “there will be a need to cater for the demand created by increased religious tourism by developing more low and mid-scale hotels. The Hotel Investment & Development Summit at Cityscape Jeddah 2013, was specifically designed as a meeting place for developers, investors, government officials, hoteliers and financiers to come together and share ideas, source new business contacts and shape strategies for maximizing and supporting the growth of Saudi Arabia’s hospitality industry.”

“In addition, with these promising prospects in sight there is huge potential for architects, designers, engineers and consultants to win new projects and grow their business during the World Architecture Congress Saudi Arabia, which we have added to Jeddah’s portfolio, following its huge success during Cityscape Riyadh.” — SG

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