Province drives real estate boom

With a significant real estate boom going on in Saudi Arabia at the moment – one which has made the world’s top property players sit up and take note –  it comes as no surprise that Eastern Province, the country’s major industrial center, happens to be right at the very core of it.
According to a recently published report by JLL, availability of low cost fuel and political and government support are just two of the major drivers of the soaring demand for industrial property in the province. Indeed, a defining feature of the Eastern Seaboard real estate market is the importance of the industrial sector, with large areas of land having been allocated for the future development of this sector in both the Dammam Metropolitan Area (DMA) and Jubail.
However, there is also a significant shortage of residential accommodation in the province, with demand creating numerous opportunities for both foreign and local developers.  One such company who is looking to take advantage is Al Nouh Real Estate, one of the province’s leading property firms.
“We have been working in real estate in the area for more than 20 years,” explains chairman Amjad Al Nouh. “But in the last five years, we’ve expanded our investment because we believe our nation is facing a very big boom regarding housing, and the government has allocated a huge budget for housing projects under its program to provide houses for  citizens.”
As a result of this extra investment, Al Nouh Real Estate is now on the verge of completing the infrastructure of Danat AL-Ramis in Qatif City, which contains 3000 lots and will provide more than 6000 housing units, ranging in category from affordable to high-end properties.
“We will also shortly start to develop another neighborhood in Siyhat and Khobar in the eastern province, as well as our many other small projects in the area,” says Mr. Al Nouh. “However, we are working to develop a new strategic plan for the next five years considering the new economic situation.”
This changing dynamic – which combines the factors of a growing, more affluent population, an expanding expatriate community and numbers of international visitors, as well as rising employment and investment levels in the area – is expected to increase both sale prices and rentals in some sectors of the market over the next few years.
Potential growth segments include the office market, which although remains limited to oil companies at the moment, is likely to develop over time as real estate demand moves downstream. Tourism is another segment of the market with huge potential.  The Saudi government, for instance,   is proposing to develop the Al-Uqair area of the Eastern Province as a major tourist destination with new hotels, residential, retail and extensive recreational facilities. Retail market growth, meanwhile, is likely to be in line with further increases in population and tourist arrivals.
Regarding Al Nouh, which plans to expand its investment as these new opportunities arise, the chairman of the real estate firm reveals that his company has its doors open to any foreign partners wanting to invest in the area.
“We in Saudi Arabia are open to all outside investors,” he says. “We welcome expertise and new ideas regarding our major work in real estate and housing construction.” “We believe the world is like a small village, we have to work together to achieve development and progress for our countries and our people.”