Saudi Arabia is on track to become the world’s largest construction market, driven by its ambitious efforts to diversify the economy and reduce its reliance on oil revenues. According to a recent report from Knight Frank, a London-based real estate consultancy, the Kingdom’s total construction output is projected to reach SAR 679 billion (USD 181.5 billion) by 2028, marking a nearly 30% increase from 2023.
A Transformative Economic Vision
The surge in construction activity reflects Saudi Arabia’s broader economic transformation under the Saudi Vision 2030initiative, which was launched to promote economic diversification, sustainability, and growth across various sectors. As part of its strategy, the Kingdom is investing heavily in infrastructure, residential developments, and mega projects designed to reshape the country’s urban landscape.
Key areas driving the construction boom include residential properties, large-scale giga projects, and developments in the aviation and hospitality sectors. These sectors are designed to attract foreign tourists and support the Kingdom’s growing international appeal, with the recently revamped tourist visa service making it easier for international visitors to explore the country.
Key Construction Markets
The construction sector is set to see significant growth in several key areas:
- Residential Property: A rising demand for residential units, driven by population growth and urban expansion.
- Giga Projects: Mega projects such as NEOM, the Red Sea Development, and the Riyadh Metro will continue to attract substantial investments and global attention.
- Aviation and Hospitality: Aiming to enhance its tourism appeal, Saudi Arabia is expanding its aviation infrastructure and hospitality offerings, preparing for international events such as the World Expo, the 2025 Asian Indoor and Martial Arts Games, and potentially the FIFA World Cup 2034.
The Kingdom’s focus on large-scale projects is contributing to the rapid evolution of Saudi Arabia’s construction market, providing exceptional opportunities for both local and foreign investors.
Growth in Saudi Construction Contracts
In 2023, more than SAR 525 billion (USD 140 billion) worth of construction contracts were awarded, the majority of which were centered around Riyadh, the capital, which is expected to grow its population to 10 million by 2030. This rapid expansion presents a wealth of opportunities for businesses involved in the construction and infrastructure sectors.
Benefits for Businesses
Saudi Arabia’s construction boom offers numerous opportunities for businesses interested in setting up a company in Saudi Arabia. The robust investment climate, coupled with the Kingdom’s ongoing reform efforts to simplify the company registration process, makes it an attractive destination for both foreign investment and 100% foreign-owned businesses in Saudi Arabia.
Additionally, the expansion of key sectors such as construction, hospitality, and aviation presents opportunities for investors to take advantage of the Kingdom’s market entry strategies, which include pro-business policies and incentives. Whether you’re looking to establish an LLC in Saudi Arabia or navigate the legal requirements for business in Saudi Arabia, the Kingdom offers ample avenues for growth and success.
Ready to Enter Saudi Arabia’s Thriving Market?
Soutien Group is specialized in assisting businesses with company formation in Saudi Arabia, business setup in Saudi Arabia, and Saudi company registration. Our expert team is equipped to guide you through the steps for business registration in Saudi Arabia and help you take full advantage of the burgeoning construction market.
Contact us to explore how we can help you expand your business in Saudi Arabia and capitalize on the country’s dynamic growth across multiple sectors. Let us help you turn your investment opportunities into a successful venture in the Kingdom’s thriving economy.
