Residential Tower Apartment Rentals Lead Saudi Real Estate Activity – Asharq Al-awsat – English

Due to their market value, apartment rentals in high-rise towers are leading Saudi Arabia’s residential real estate sector as the most profitable of real estate branches.
According to experts, apartment rentals’ annual revenues exceed 12% of their total price.
Apartment rental activity in residential towers has surpassed all other real estate activities in the local rental sector, said experts, revealing that the rent for these apartments can reach up to SAR 270,000 annually.
Market data suggests that a return on investment ranging from 8% to 12% annually is considered the most successful percentage to measure the profitability of real estate investments.
The sizes of these residential tower apartments range from 45 square meters to 200 square meters, with prices starting from SAR 1.3 million and reaching up to SAR 3 million.
Prices vary depending on the city, size, location, age of the property, amenities, and proximity to public services and major roads.
Abdullah Al-Obaid, a certified real estate broker with the “Ejar” network, highlights the Saudi real estate market’s ability to diversify its activities and promote various real estate branches from time to time.
This strategy allows it to adapt to the dynamic economic sector with growth, diversity, and competitiveness. He explains that liquidity flows up and down to shift towards the most in-demand branch based on market trends.
Obaid further noted that residential apartment rentals in high-rise towers have dominated the overall activity in the Saudi real estate market, overshadowing the office space rental sector, which experienced significant growth from 2020 until the beginning of 2023.
This shift is attributed to the societal culture and preference for residential apartments, especially in major metropolitan areas, due to limited supply and the changing perception of community living.
Abdulmalik Abdullah, an investor in the high-rise apartment sector, further clarified that there is a higher demand for smaller apartments, with furnished ones being in the greatest demand.
The higher the floor, the greater the demand, he added.
Abdullah also pointed out that shorter lease durations increase the unit’s value, as annual rentals yield less compared to monthly, weekly, and daily rental rates.
 
 
Saudi Arabia has achieved a significant milestone in the tourism sector, ranking second globally in terms of tourist arrivals during the first seven months of 2023.
According to the Ministry of Tourism, the Kingdom witnessed a remarkable 58% growth in tourist numbers during the first seven months of this year compared to the same period in 2019.
The data is sourced from the UNWTO World Tourism Barometer, published by the United Nations World Tourism Organization (UNWTO) in September 2023.
This is a continuation of Saudi Arabia’s success in the tourism industry and its position as a global leader in this field. Riyadh hosted World Tourism Day on September 27-28.
Minister of Tourism Ahmed Al-Khateeb said this achievement would not have been possible without the support of Custodian of the Two Holy Mosques King Salman bin Abdulaziz and Prince Mohammed bin Salman, Crown Prince and Prime Minister.
This achievement strengthens the Kingdom’s status as a global tourist destination. The substantial rise in tourist arrivals reflects the confidence travelers have in the variety and quality of tourism options available in Saudi Arabia.
Saudi Arabia’s Public Investment Fund (PIF) announced on Tuesday the establishment of Al Balad Development Company (BDC).
The company will become the main developer of Jeddah’s historic Al Balad district, in line with the continuous efforts led by Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister, to revitalize Historic Jeddah to transform Jeddah into an economic hub, a global cultural and heritage destination, and a leading tourism destination, inspired by Jeddah’s rich history and contributing to the realization of Saudi Vision 2030.
The company will focus on improving the district’s infrastructure, overseeing the restoration of historic buildings in Al Balad, and developing service facilities as well as recreational, residential, commercial, hotel and office spaces.
The overall project development area will comprise approximately 2.5 million square meters, with a total built up area of 3.7 million square meters. This includes 9,300 residential units, 1,800 hotel units and around 1.3 million square meters of commercial and office space.
The company will collaborate with the private sector and specialists to develop the area’s infrastructure according to the best standards of urban planning for historic areas, taking into account environmental sustainability and preserving the unique heritage of Historic Jeddah: a UNESCO World Heritage site.
The aim is to transform it into a leading tourism destination that attracts visitors from around the world, thus contributing to economic development, with the company also working to offer attractive investment opportunities and quality commercial options for the people of Jeddah.
BDC aims to provide a rich experience to explore the cultural and historic dimensions of the district by providing an integrated environment that attracts residential, work, cultural and recreation development, contributing to quality of life and improving the visitor experience.
Al Balad is recognized for being an iconic Red Sea port, in addition to featuring a unique urban character and distinctive coral limestone architecture. In 2021, Crown Prince Mohammed launched the “Revitalize Historic Jeddah” initiative, as part of “Historic Jeddah Development Project.”
The establishment of BDC aligns with PIF’s strategy to diversify the Saudi Arabia’s economy through developing and enabling strategic sectors, including real estate and tourism, contributing to achieving the aims of Vision 2030.
Saudi Cruise, a wholly owned PIF subsidiary, specializing in developing the cruise sector in Saudi Arabia, announced new agreements with a number of world-leading technology companies to boost investment in the Aroya Cruise Line.
The move is part of Saudi Cruise’s vision to offer innovative experiences in the tourism sector in the Kingdom in line with the objectives of Vision 2030.
Saudi Cruise renews its commitment to offer unique and innovative passenger experiences through these strategic partnerships with Monitor Deloitte for digital strategic consultancy, Alibaba Cloud for cloud computing services, theICEway for IT services, SourceToad for software engineering, Otalio for property management systems on board ships, and Versonix for travel and entertainment software services.
The Saudi Cruise team has expertise in the field of IT and digitization and strives to achieve innovation and excellence in the cruise industry. These efforts emphasize the company’s clear vision.
Iraq, OPEC’s second producer after Saudi Arabia, said on Tuesday it would award 30 new oil and gas projects in its fifth + and sixth licensing rounds.
The fifth + licensing round includes 16 new projects, some of which were not awarded in the fifth licensing round and some new projects, the oil ministry official said at the ADIPEC energy conference held in the UAE capital Abu Dhabi.
The sixth licensing round will include 14 projects, he said.
The number of Saudi nationals in the private sector rose to 2.2 million in the second quarter of 2023.
With the close of last September, the General Authority for Statistics (GASTAT) revealed a decrease in the unemployment rate among Saudis in the second quarter of 2023, dropping from 9.7% to 8.3%, compared to the same period last year.
This figure approaches the government’s targets in Vision 2030, which are set at 7%.
On Monday, the National Labor Observatory, a part of the Human Resources Development Fund (HRDF), disclosed that the total growth in the number of Saudi workers in comparison to the same quarter of 2022 reached approximately 210,000 employees, with an average growth of 42,000 employees per quarter until the end of the second quarter of 2023.
The expansion in the number of citizen workers in the private sector can be attributed to the positive economic growth witnessed in the Saudi economy.
This growth has contributed to increasing the overall labor market size, strengthening demand for labor, and boosting productivity rates in the market.
The Observatory released a report on Saudization for the second quarter of the current year, which reviews changes in the labor market and job localization rates in private sector establishments.
The report showed that the number of Saudi employees recorded the most significant increase for both genders, with males standing at 1.3 million, compared to about 900,000 females, bringing the total Saudization rate to 22.3%
The Eastern Province took the lead, recording the highest Saudization rate of 27 percent, followed by Makkah at 24 percent and Riyadh and Madinah at 21 percent each.
The information and communications sector also achieved a strong participation rate for male citizens, reaching 60%, while education achieved the highest engagement of female citizens at 53%.
The Statistics Center – Abu Dhabi (SCAD) announced the gross domestic product (GDP) estimates for the second quarter of 2023, revealing a whopping 12.3 percent growth of the non-oil economy and a 3.5 percent increase in the total GDP compared to the same period in 2022.
Abu Dhabi’s non-oil economic activities have maintained remarkable growth in Q2 2023, leading the value of the emirate’s real non-oil GDP to $42 billion, the highest since 2014 to break a record registered in the first quarter of the current year, where it surpassed $39 billion.
According to preliminary estimates, the value of Abu Dhabi’s real GDP in the second quarter of 2023 reached its highest level at $78.2 billion, driven by the growth of all non-oil activities, to continue the increase of its contribution to the GDP to 53.7 percent.
It boosted the growth of the emirate’s non-oil GDP by 9.2 percent in the first half of 2023 compared to the same period last year.
Morocco’s national economy grew by 2.3 percent in the second quarter of 2023, compared with 2.2 percent in the same quarter of 2022.
Driven by external demand, this growth was achieved against a backdrop of high inflation and an improvement in the national economy’s financing capacity.
According to the Higher Planning Commission (HCP), the country’s leading statistics institution, non-agricultural activities recorded a 2.1 percent volume increase, compared to a rise in agricultural activities by 6.3 percent.
Meanwhile, the added value of the primary sector increased in terms of volume, recording an increase of 6 percent during the second quarter of 2023.
It was due to an increase in agricultural sector activities by 6.3 percent, paired with a slower 0.5 percent growth in fishing.
Furthermore, the added value of the secondary sector recorded a 2.8 percent drop compared to 1 percent during the second quarter of last year.
The decrease is due to a decline in the added values of each extraction industry by 9.4 percent compared to a 7.5 percent decrease.
Public works and construction increased by 2.8 percent instead of a 1.8 percent decrease. Manufacturing industries saw a 2.1 percent rise compared to a 1.8 percent increase.
Electricity and water activities increased by 1.4 percent compared to a 1.5 decrease during the same period.
At the same time, the added value in the tertiary sector slowed to 4.4 percent, marked by a rise in real estate services and a slowdown in accommodation and catering.
Services such as the transport and warehousing sectors slowed by 5.3 percent, while education, health, and social services dropped by 5.1 percent.
General public administration and social security services also fell by 4.8 percent.
Other services experienced a slowdown, including research and development and business services, information and communication, financial services and insurance, and trade and repair of vehicles.
In the first quarter of 2023, the Moroccan economy recorded a rise of 3.5 percent.
Jordan’s Ministry of Investment announced new investment prospects through the online platform to explore and extract oil shale.
According to the platform, there are more than 18 known oil shale sites in Jordan, including al-Lajjun, al-Sultani, Jurf al-Darawish, al-Attar, Umm al-Ghadran, Wadi Maghar, Suwaqa, Khan al-Zubaib, and al-Thamd.
The investor must develop and invest in infrastructure assets and create new construction opportunities, long-term returns for shareholders, and concession rights.
The data showed that most of the leading oil shale places of proven commercial importance are in central and southern Jordan and can be easily reached via the desert road between Amman and Aqaba.
Oil shale is also found in the areas of Wadi al-Adhiyah, Wadi al-Nadhiyah, Asfir al-Mahatta, the Ghazimah Mountains, Wadi Abu al-Hamam, and most of these areas are close to the infrastructure services necessary for investment.
The data indicated that oil shale is defined as a sedimentary rock in which the organic content (kerogen) is insoluble in organic solvents but instead forms oil-like liquid hydrocarbons when subjected to thermal decomposition at temperatures of up to 500 – 600°C.
Jordan has a sizeable domestic resource of oil shale spread across 60 percent of the Kingdom’s total area, making it the fourth-largest oil shale reserve worldwide.
According to the data provided by the platform, oil shale is a safe and long-term solution to Jordan’s significant energy needs.
Many studies and surveys conducted on the use of oil shale in several locations in Jordan confirmed that the material can be exploited through three paths: heating the deep oil shale to produce oil, distilling the oil shale through surface mining, and direct combustion of oil shale to generate electricity.
The number of industrial establishments in Saudi Arabia increased from 8,800 in 2019 to more than 11,000 industrial establishments, according to Ministry of Industry and Mineral Resources official Mohammad al-Suwailem.
The undersecretary for industrial services was speaking at the “Industrial Sector Enablers” forum, organized by the Riyadh Chamber represented by the Industrial Committee, in cooperation with the Ministry of Industry and Mineral Resources.
The forum was held in the presence of a member of the Board of Directors and Chairman of the Industrial Committee at the Riyadh Chamber, Abdullah al-Khorayef, and several interested specialists in the industrial sector.
The event highlighted the enablers allocated to enable the industrial sector to achieve the industrial goals within the paths of Vision 2030.
Suwailem confirmed that the number of industrial establishments in Saudi Arabia is targeted to reach 36,000 in 2035.
Khorayef confirmed that holding the forum comes within the framework of the efforts of the Chamber’s Industry Committee to build bridges of communication with officials in the industrial sector.
He reiterated that it allows the opportunity to discuss issues of concern to the sector and reach solutions.
The Saudi Minister of Economy and Planning, Faisal bin Fadel Al-Ibrahim, hosted on Monday a reception for representatives of government entities and private sector companies participating in the sixth session of the Saudi-Portuguese Joint Committee and the Saudi-Portuguese Investment Forum in the Portuguese capital, Lisbon.
The minister heads the Saudi delegation participating in the sixth session of the Saudi-Portuguese Joint Committee, which aims to strengthen economic relations, explore investment opportunities between the two countries, and enhance cooperation in various fields.
The Saudi Minister also visited the Park of Nations, a neighborhood in Lisbon that was constructed for the 1998 World Expo.
Furthermore, he discussed with Executive Secretary of the Community of Portuguese Language Countries (CPLP) Zacarias da Costa promoting relations between the Kingdom and Portugal.
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