Salaam - Riyadh office rents jump 15% as reforms lift Saudi property sector
As-salamu alaykum - Saudi Arabia’s push to diversify its economy is giving new life to the property market. Office rents in Riyadh have risen about 15% year-on-year and occupancy is near 98%, driven by big reforms and long-term investment plans.
The market is getting a boost from potential long-term investments and measures like the expanded white land tax and a five-year rent freeze in Riyadh. A recent market review noted the office sector is leading growth as non-oil industries expand and many multinational companies move regional headquarters to Riyadh.
Strengthening the property market is part of Vision 2030’s goal to make the Kingdom a global hub for business and tourism. Authorities expect the real estate sector to grow significantly by 2029. Analysts say regulatory changes and steady strategic investment are transforming the market and creating opportunities for investors, developers, and tenants.
One important factor is the regional headquarters program, which has issued many new licenses and offers incentives like a long corporate tax exemption for qualifying companies. Demand is strongest in technology, finance, and health care, and limited supply has led some firms to secure space through early pre-leases.
The King Abdullah Financial District remains central to Riyadh’s expansion plans, with proposals to double its size and welcome tens of thousands of daily visitors. Infrastructure improvements, including plans to reactivate a short monorail, aim to make the area more convenient and attractive.
Key policy changes expected to support growth include a new ownership law for non-Saudis coming into effect next year, an expanded white land tax to discourage speculation and encourage development, and the five-year rent freeze intended to stabilize costs for residents and businesses.
Beyond offices, residential transactions and prices have been rising, retail sales are picking up, and hospitality metrics like revenue per available room and occupancy are improving. Logistics and industrial rents are also climbing in some districts.
Overall, the combination of reforms, large planned projects, and targeted incentives is reshaping Saudi Arabia’s real estate landscape. May Allah make these developments beneficial for the people and help bring sustainable, fair growth to the country.
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