Article

Reimagining Saudi Arabia's Urban Landscape

Real estate insight from Clarke Morton-Shepherd, Head of Markets, Project & Development Services KSA, JLL MENA

December 12, 2024

The transformation of Saudi Arabia's urban landscape is a complex and multifaceted process that encompasses a wide array of initiatives aimed at rejuvenating and modernising its cities. From urban renewal projects and strategies for brownfield development to the modernisation of buildings, integration of smart technologies, innovative financing models, and vibrant community engagement, Saudi Arabia is on a path to reshape urban spaces into greener, smarter, and more human-centric communities. These efforts not only aim to enhance living standards but also to solidify Saudi Arabia's position as a leading global urban centre.

Vision 2030 and the birth of urban developments

Saudi Arabia's Vision 2030 initiative is the driving force behind this urban transformation. This ambitious plan seeks to diversify the kingdom's economy, reduce its oil dependency, and develop public service sectors such as health, education, infrastructure, recreation, and tourism. Central to this vision is the transformation of urban areas to accommodate a growing population and facilitate a modern lifestyle.

High-profile development projects like the King Abdullah Financial District, King Salman Park, and the futuristic giga-city NEOM have attracted global attention, symbolizing a progressive shift in Saudi urban development. These projects, however, are merely the initial steps in a comprehensive plan that targets a far-reaching transformation of the kingdom's urban landscape, with Riyadh at the forefront.

Riyadh: The epicentre of transformation

Riyadh, as Saudi Arabia's capital and largest city, exemplifies the challenges and opportunities inherent in urban transformation. The city's population has experienced staggering growth, soaring from 111,000 in 1950 to over 7.8 million by 2024. This rapid urbanisation has been characterized by horizontal expansion, leading to a sprawling cityscape with a low population density of about 4,300 people per square kilometre. In stark contrast, other global urban centres exhibit much higher densities, such as Singapore with 8,500, New York with 10,500, Cairo with 19,000, and Manila boasting over 43,000 people per square kilometre.

The extensive urban sprawl in Riyadh has significant ramifications, including lengthy commutes, often exceeding two hours a day, which not only inconvenience residents but also strain the city's infrastructure and contribute to pollution. To tackle these challenges, Riyadh has embarked on constructing the region’s most comprehensive metro system. This ambitious project consists of six lines spanning over 176 kilometres and features 84 stations. The recent inauguration of the first stage of the Riyadh metro is a pivotal milestone, paving the way for high-density, transit-oriented developments (TODs) around key multimodal interchanges and metro stations.

Densification: The path forward

Increasing urban density through mid-to-high-rise developments presents numerous benefits for Riyadh's residents and governing authorities alike. Shorter commute times inevitably translate into reduced carbon emissions and lower infrastructure costs, aligning with Vision 2030's emphasis on creating sustainable and livable urban environments. Consequently, a significant rise in residential density is anticipated in Riyadh and across Saudi Arabia over the coming decade.

According to JLL research, Riyadh's total housing stock reached 1.46 million units by the third quarter of 2024, with approximately 4,000 new units completed during this period. While villas have traditionally been the housing choice for Saudis, there is an observable shift towards apartment living driven by affordability and urban lifestyle preferences. This shift is crucial in accommodating Riyadh's projected population growth, which is expected to exceed 9 million by 2035.

Community engagement and future-proofing

An essential facet of this transformation is community engagement, ensuring that urban development aligns with the aspirations and well-being of the residents. Authorities are increasingly focused on fostering public participation in urban planning, particularly in targeted redevelopment areas. This collaborative approach ensures that new developments reflect the cultural and social values of the community.

Moreover, future-proofing Saudi cities is another critical component of urban transformation. This involves leveraging advanced technologies, such as IoT, AI, and data analytics, to enhance urban living through smart cities. By integrating these technologies into urban infrastructure, cities can improve energy efficiency, optimize traffic management, and enhance public services, providing a resilient and adaptive framework for future generations.

Financing the urban transformation

The financial undertakings of these ambitious urban projects are immense and may necessitate innovative funding models to ensure sustainability and scalability. Public-private partnerships (PPPs) for example, can be used in financing urban development, leveraging private sector investments alongside government funding. These partnerships can facilitate the sharing of risks and rewards and ensure that large-scale projects align with commercial viability and public interest.

Trailblazing toward tomorrow

As Saudi Arabia continues down this path of urban transformation, it is setting a precedent for other nations seeking to modernise and innovate their urban landscapes. By embracing a holistic approach that combines advanced technology, sustainable practices, and community involvement, Saudi Arabia is on the cusp of creating cities that are not only economically vibrant but also enriching places to live.

In essence, the ongoing transformation of Saudi Arabia's urban areas is a testament to its commitment to progress, innovation, and the well-being of its citizens. With each city and project, Saudi Arabia is reimagining its future, crafting urban spaces that reflect both its rich heritage and its aspirations for tomorrow.

Looking for more insights? Never miss an update.

The latest news, insights and opportunities from global commercial real estate markets straight to your inbox.