While the real estate market experienced softening in Jeddah in Q3, the city experienced a boost with ongoing investments in infrastructure and non-oil industries expected to offset the subdued nature of the market in the long-term, according to the latest JLL report on Jeddah.
JLL findings reveal that new transport infrastructure developments in Jeddah are paving the way for a more connected city which could positively impact future office demand. This quarter, the Haramain High Speed Railway completed its first journey from Jeddah’s Al-Sulaymaniyah station celebrated 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.
Looking at the residential sector, 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 instalmentof the Sakaniprogramme was announced in Q3, aiming to deliver 33,000 housing financing options to citizens across the Kingdom,” notes JLL.
Finally, JLL maintains that the rental and vacancy rates in Jeddah’s retail sector remained unchanged in Q3 as there were no new further completions. However, cinemas, F&B and entertainment options are still the hot topic of shopping centres and will play a greater role in malls performances goingforward. Job opportunities for Saudi Nationals continue to be a focus of Vision 2030 which in turn will boost jobs in the retail sector.