RIYADH: Saudi Arabia is powering growth in the Gulf Cooperation Council’s real estate sector, accounting for 63.1 percent of total projects in the region in 2024, a new report showed.
According to consultancy firm CBRE, the total value of the projects pipeline across the GCC is estimated at $1.68 trillion in 2024 – an increase from $1.38 trillion the previous year.
The Kingdom accounts for $1.06 trillion of this total.
The UAE follows Saudi Arabia, with $409 billion, representing 24.1 percent of the planned spend. Oman contributes 5.2 percent, Kuwait represents 3.2 percent while Qatar and Bahrain account for 2.9 percent and 1.3 percent resepectively.
In its report, CBRE revealed that the growth of real estate projects in the GCC is a fundamental component of the region’s diversification strategies.
Taimur Khan, head of research, Middle East and North Africa region at CBRE, said: “The region’s economic prospects remain positive, defying the global macroeconomic backdrop as regional economies are set for stronger growth and inbound investment levels, something which will continue to underpin a strong performance and demand in the region’s real estate sector.”
He added: “In the GCC’s residential market, price performance has almost uniformly been positive over the course of 2023. Whilst the direction of price changes has converged toward a largely positive territory, we continue to see a significant polarization in the rates of growth witnessed, something we expect to see continue.”
In its report, CBRE added that the Middle East real estate market is anticipated to sustain its upward trajectory in 2024, buoyed by robust economic growth, high demand, and limited supply.
According to the consultancy firm, office sector occupier activity in 2024 will center around Riyadh due to high demand from both national and international occupiers.
However, CBRE added that global economic headwinds and lack of stock in key GCC markets may hamper market activity levels in the office sector.
The report further pointed out that average price growth in Riyadh will materially outperform other key cities in the residential sector in Saudi Arabia.
In the hospitality sector, CBRE expects the Kingdom to witness a bright transition in 2024 as it is ready to receive visitors to its tourist destinations.
“In Saudi Arabia, the year will be a transitional one, as new destinations continue to be developed, and traditional homes of domestic leisure visitation such as Al Khobar, Jeddah and Abha find themselves in a more competitive market,” stated CBRE.
