Kingdom of Saudi Arabia Retail Market Dynamics, Q1 2025
Summary and analysis of the Kingdom of Saudi Arabia's current retail real estate market conditions.
- Faraz Ahmed
- Muhammad Aijaz
- Taimur Khan
The Kingdom’s retail market in Q1 2025 showcased diverse vacancy trends across different cities and mall categories. Riyadh's retail sector recorded slight improvement, with the overall vacancy rate decreasing marginally to 5.1% from 5.2% in Q1 2024. This modest reduction signalled a steady, albeit slow, recovery in the capital's retail space demand.
Jeddah, however, exhibited a more pronounced improvement. Its vacancy rate fell significantly to 13.0% in Q1 2025 from 17.7% during the same period last year, indicating increased retail activity and consumer engagement in the city’s retail market.
Super regional and community malls in both cities exhibited resilience and positive performance trajectory, while regional malls faced persistent challenges. Traditional mall formats experienced declining occupancy rates, underscoring a clear shift in consumer preferences. Shoppers increasingly gravitated towards dynamic, experiential retail concepts in open-air mall formats offering diverse experiences.
