Saudi’s Jed­dah prop­erty mar­ket soft­ened in Q3 2018

On­go­ing in­vest­ments in in­fra­struc­ture and non- oil in­dus­tries are ex­pected to off­set sub­dued na­ture of the mar­ket in the long term, says JLL

Facilities Management Middle East - - CONTENTS -

The real es­tate mar­ket in Jed­dah soft­ened fur­ther across most sec­tors in Q3, re­vealed JLL’s lat­est mar­ket over­view. How­ever, on­go­ing in­vest­ments in in­fra­struc­ture and non-oil in­dus­tries are ex­pected to off­set sub­dued na­ture of the mar­ket in the long term.

There were two no­table com­ple­tions in the of­fice sec­tor in Q3 bring­ing the to­tal Gross Leasable Area (GLA) to 1.05 mil­lion sq m, de­spite de­lays in the de­liv­ery of a few de­vel­op­ments. As a re­sult, of­fice rents dropped fur­ther this quar­ter as va­cancy rates con­tin­ued to in­crease with the new sup­ply, JLL said in a re­port.

This quar­ter, the Hara­main High Speed Rail­way com­pleted its first jour­ney from Jed­dah’s Al-Su­lay­maniyah sta­tion cel­e­brat­ing the com­ple­tion of the largest elec­tric train project in the Mid­dle East.

The rail link will aim to con­nect Jed­dah, Makkah and Mad­i­nah with im­proved ac­cess to Jed­dah’s King Ab­dul-Aziz In­ter­na­tional Air­port, King Ab­dul­lah Eco­nomic City and Mad­i­nah.

“Al­though the mar­ket re­mained sub­dued in Q3, the en­hanced in­fra­struc­ture de­vel­op­ments to­wards a more con­nected city are a step to­wards at­tract­ing in­creased in­vest­ment op­por­tu­ni­ties. The new King Ab­dul-Aziz In­ter­na­tional Air­port will in­au­gu­rate op­er­a­tions in mid-2019, and this com­ple­tion has the po­ten­tial to uplift the real es­tate mar­ket per­for­mance in Jed­dah,” com­mented Dana Sal­bak, As­so­ciate, JLL MENA.

There were no no­table res­i­den­tial com­ple­tions in Q3 2018, leav­ing the to­tal sup­ply rel­a­tively stable at 817,000 units. In line with the Min­istry of Hous­ing’s (MoH) tar­get of in­creas­ing home own­er­ship in Saudi Ara­bia to 60% by 2020, the ninth in­stall­ment of the Sakani pro­gram was an­nounced in Q3, aim­ing to de­liver 33,000 hous­ing fi­nanc­ing op­tions to cit­i­zens across the King­dom.

Mean­while, a con­tract has been awarded by Saudi Ara­bia’s Ar­riyadh De­vel­op­ment Au­thor­ity to de­liver op­er­a­tions and main­te­nance (O&M) ser­vices for Lines 1 and 2 of Riyadh Metro. Cap­i­tal Metro Com­pany (Camco) – a joint ven­ture of RATP Group’s RATP Dev and Saudi Pub­lic Trans­port Com­pany (SAPTCO) – has won the deal, which spans 12 years and in­cludes mo­bil­i­sa­tion.

There were no no­table res­i­den­tial com­ple­tions in Q3 2018, leav­ing the to­tal sup­ply rel­a­tively stable at 817,000 units.

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