Saudi Arabia needs 100 malls worth 20 billion riyals within 10 years
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Riyadh leads Saudi cities in the number and growth of major shopping malls\u00a0
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Mr. Fahad bin Abdullah Al-Othaim, CEO of Al-Othaim Real Estate Investment and Development Company, stressed the importance of the real estate industry in the Kingdom in driving development and achieving more progress and prosperity for citizens, indicating that expectations indicate that real estate investments in the Kingdom will exceed 1.5 trillion riyals during the year 2010.
\nThe Saudi real estate market provides stimulating opportunities for investors and real estate developers, as it is the largest in the region, and its importance increases with the rapid growth in the population, which is expected to reach more than 50 million people by 2050.
\nKa talked about many matters related to the real estate industry in the Kingdom in this interview:
\nQ: How do you see the future of the real estate industry in the Kingdom?<\/p>\n
We have great confidence that the Saudi real estate market will maintain its attractiveness and vitality, and overcome the repercussions and effects of the global financial crisis that cast a shadow on global markets.
\nIn addition to the growing population growth in the Kingdom, which represents an important tributary to the real estate market and increases its growth opportunities, as well as the cohesiveness and strength of the Saudi economy, there are a number of stimulating and attractive factors that will push the market and enhance its opportunities to achieve further growth, in particular the continued government spending on development projects, the availability of the appropriate environment for the establishment of mega real estate projects, and the establishment of integrated economic cities.
\nThe real estate industry in the Kingdom of Saudi Arabia is considered one of the stimulating industries that push the country's development wheel to further progress and prosperity, as studies indicate and confirm expectations that real estate investments in Saudi Arabia will exceed 1.5 trillion riyals during the year 2010 (according to a report prepared by the Global Investment House (Global).
\nWhat additions can the real estate industry make to the GDP?
\nThe contribution of the real estate sector to GDP is close to 55 billion riyals, according to reports issued by the Council of Saudi Chambers, which indicated that real estate activity is expected to grow by the end of 2009 at a rate of 5.8%, and its contribution to GDP will rise to more than 7%, approaching 60 billion riyals. .
\nWhat is your assessment of the investment opportunities offered by the real estate market in the Kingdom?
\nThe Saudi real estate market provides stimulating opportunities for investors and real estate developers, as it is considered the largest in the region, and its importance increases with the rapid increase in the population, which is expected to reach more than 50 million people by 2050, according to a report issued by the Saudi British Bank (SABB). It is certain that the population increase will double the volume of demand for housing units to a figure exceeding 2.5 million units during the next 20 years, especially since estimates indicate that more than 50% of the population does not currently own private housing. According to the real estate report issued by Global Investment House (Global)<\/p>\n
What is the future of the mall industry in the Kingdom in general and Riyadh in particular?
\nAvailable studies in this field indicate that the Saudi market needs more than (100) large shopping centers over the next ten years, with investments of more than (20) billion riyals, with ten centers per year, in order to keep pace with population growth and the rapid urban expansion that accompanies this growth. .
\nAs for Riyadh, it leads the Saudi cities in the number of major commercial complexes and is considered the fastest growing city in this field, compared to the population of 4.5 million people, with a growth rate exceeding 6 %, and there is no doubt that population growth has helped increase the volume of investment in commercial centers. .
\nRiyadh is poised to see an exponential growth in the number of malls, making it the fastest-growing capital in the Arab world.<\/p>\n
Q : From your point of view, what are the reasons why real estate experts are ignored by project owners? Is it a weakness in the investor's culture, or the growing role of weak real estate professionals who fell in the middle of the road?
\n- If this disregard was a phenomenon or behavior, it was in an earlier period. Some investors viewed advisory matters as not constituting an asset, even though they were paying this value and even more in other ways
\n- However, the real estate services market is now on its way to professionalization in light of many local and global variables. Experts and consultants are no longer perceived as they used to be ... and project owners no longer view consulting costs as an extra expense ...<\/p>\n
What role can major shopping malls play in supporting tourism within the Kingdom?<\/p>\n
Malls in Saudi Arabia are one of the most important commercial tourist destinations that make the Kingdom a first and main stop for Gulf tourists.
\nA recent Saudi field study conducted on some tourist destinations and commercial centers indicated that visitors to closed commercial centers approached 10 million visitors during .
\nHere we must point out the keenness of commercial centers to establish miniature entertainment centers inside them as a kind of internal tourist entertainment, as these centers have become an important attraction for their visitors from Saudi families. .<\/p>\n
Q : Have you considered revitalizing cooperation between the public and private sectors on housing in relation to land prices and building materials?
\n- If we take into account that comprehensive development is the most important solution to the housing crisis in Saudi Arabia, and it is the main pillar of housing development through its many benefits and multiple positives, the activation of cooperation should be in the following: The government sector, which is the organization of services and facilities and ensuring the establishment of advanced neighborhoods according to the concept of comprehensive development, making them model neighborhoods that increase in value over time. .
\nThus, the golden equation is achieved from this cooperation, where developers accomplish their projects and achieve their profitability goals, and the citizen receives the appropriate high-quality housing in an integrated services environment. .<\/p>\n
Q : It is said that the real estate market has become attractive to local and regional companies. How do you explain this?
\nThe Saudi market is currently witnessing an increase in demand for real estate of various types, and the opportunity is currently favorable to double real estate investment, especially since it is considered a safe haven, God willing, from the occurrence of crises and economic fluctuations. .
\n The advice, if I may call it advice. The low prices of building materials and the stagnation of small products have increased the temptations of the real estate market for small products, as the opportunity will be favorable in the coming years to increase investments in this aspect. .<\/p>\n
Q : Many local real estate investors have turned to investing in neighboring countries, what do you attribute this to?
\nI believe that this phenomenon is temporary, especially if we take into account the investment advantages available in the Kingdom that are not available to other countries in the region. .<\/p>\n
Q : In your view, are there any risks facing real estate investment in Saudi Arabia in particular and the Gulf countries in general, and what are the types of risks?
\n- Investing in the real estate market is considered one of the safest and least risky investments, as the real estate market is one of the most important pillars of the Saudi economy, and the largest national and foreign savings and investments are directed towards it. .
\n- The Gulf market continues to attract investors in various types of real estate products, and promises a promising future due to the strength of the economies of these countries, the political stability of their systems, and the need of their populations for real estate products in light of the rapid growth of the region's population, especially the Kingdom of Saudi Arabia. .
\n- Here, it is necessary to unify efforts between the GCC countries to overcome obstacles and issue regulations that serve and promote the real estate market
\n- It is necessary to enter into strategic alliances between real estate companies within the local framework and within the framework of the countries of the region in order to serve the real estate sector, and the ability to compete with major companies. . <\/p>\n
Q : What are the conditions for a good investment in shopping centers?
\nThe project must be studied in detail. .
\nThe investor must be a good reader of the market and its trends. .
\nThe importance of choosing a good location. .
\nSetting goals .
\nIdentify your target customers. .
\nAdherence to the best standards in design and implementation. .
\nAttracting international and local brands.
\nThe importance of customer retention. .<\/p>\n
Q : Do real estate conglomerates help the investor to enter the real estate market with confidence?
\nIn light of the Kingdom's accession to the World Trade Organization, and after the door is open to major non-Saudi companies, companies that possess economic components and high and distinguished expertise that seek to acquire a large share of the market, the new reality requires the creation of major real estate conglomerates capable of moving the market positively, enabling these companies to achieve the required balance.<\/p>\n
Q : What is the value added to the Saudi market through the mortgage law?
\n- The Mortgage Law in addition to the complementary real estate regulations expected to be issued will play an important role in developing and increasing the effectiveness of the Saudi real estate market. .
\n- The passage of these legislations will attract more foreign investments and make the market more attractive to foreign investors.
\nMost importantly, these systems will transform the market into a more professional and authentic industry that will be managed with scientific and academic thought that keeps pace with the development in the world. .<\/p>\n
Q : What does the real estate market need to be the best?
\nIn fact, the real estate market is the best and most attractive, and this advantage will continue, God willing, in light of the investment and economic components enjoyed by the Kingdom.
\nIn order to maintain this advantage, it is important to ensure that regulations and legislations keep pace with the real estate market with its rapid developments. .<\/p>","protected":false},"excerpt":{"rendered":"
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