For a long time, investing in sustainability was viewed as an additional cost borne by the developer to improve a building’s efficiency and reduce its environmental impact. However, this perspective has begun to shift as the real estate market has moved from focusing on construction costs to calculating the cost of owning and operating a property over its entire lifecycle.
In Saudi Arabia, sustainability is no longer just a trend for the future. In 2025, the total certified area exceeded Green Building Certification exceeded 1 million square meters across 6,662 projects, according to data from the Saudi Green Building Forum. The data also indicated that these projects contribute to reducing carbon dioxide emissions by approximately 62,800 metric tons annually. However, the economic value of sustainability begins elsewhere: the operating bill. A building that is more efficient in its consumption of electricity and water not only yields environmental benefits but also reduces recurring expenses for the owner or tenant. As the importance of operating and maintenance costs in investment decisions rises, the difference between a standard building and a highly efficient one becomes part of the return on investment, rather than merely a design feature.
A recent study by Knight Frank reveals that 48% of international buyers interested in real estate in Saudi Arabia consider energy efficiency to be one of the most important sustainability features, while 46% chose water efficiency and 44TP3T chose air quality and ventilation systems. This means that sustainability features are now actively factored into the property selection equation, especially among buyers from markets that are more mature in this area.
This point becomes even more important when we shift from the purchase decision to resale value. A property that consumes less energy, provides a better indoor environment, and holds a credible sustainability certification may be better able to retain its appeal over the years compared to a traditional property. On the other hand, older, low-efficiency buildings may face an increasing risk of becoming less attractive to tenants and investors—a phenomenon that global real estate institutions have begun to describe as “obsolescence” risks linked to rising market demands.
In the Kingdom, the regulatory framework itself is moving toward solidifying this concept. The «Sustainable Construction" program saw a 32% increase in the number of projects benefiting from sustainability assessments during 2024, reaching 75 projects with a total area of nearly 47 million square meters. The assessment covers energy and water efficiency, quality of life, and operations and maintenance.
However, this does not mean that every investment in sustainability automatically yields a return. The return depends on the cost of the technology, the size of the building, the nature of its use, the climate, and the payback period. Installing high-efficiency systems without studying the asset’s life cycle may increase construction costs without yielding sufficient savings.
Therefore, the real question is no longer "How much will sustainability cost?" but rather "How much will unsustainability cost us?"
As the Saudi real estate market matures, the equation appears to be gradually shifting. The most valuable property in the future will not necessarily be the cheapest to build, but rather the one that strikes the best balance between construction costs, operating costs, quality of use, and resale value.
Consequently, sustainability is shifting from a mere item on a list of specifications to a component of a property’s investment value; a shift that may become more apparent as investors and buyers become increasingly concerned with what they will pay after purchasing the property, rather than just what they will pay at the time of purchase.
@ArchHesham
