Commercial property investors looking to invest in Saudi Arabia have a sense of optimism that makes perfect sense, given the encouraging developments that have been happening in the country. In February 2011, King Abdullah made a major announcement that the country would increase spending by $130 billion.
The cabinet approved the country’s first mortgage law in July. The legislation sets out regulations for mortgage companies and their activities, and will give the residential and commercial market a boost.
Consumer confidence is positive, and the increased spending on infrastructure and other projects means there will be multiple opportunities for investors going forward. The private sector will play a more prominent role in the economy as deregulation continues.
The country has the 20th largest economy in the world and is one of the world’s fastest-growing countries. The per capita income is expected to rise to $33,500.00 by 2020. It sat at $20,700.00 in 2007, according to the Saudi Arabia General Investment Authority.
The proposed Kingdom Tower is an example of the type of commercial project that will be much easier to build in Saudi Arabia. Plans for the building, which will reach 1 km in height, are backed by Prince Alwaleed. The projected cost of the project is $1.2 billion. The price tag will be significantly lower than Dubai’s Burj Khalifa, which cost $1.5 billion.
The designs for the Kingdom Tower show a mixed-use complex that will have a Four Seasons Hotel and an observation deck. The tower will also have office space, and tenants and visitors will be served by 59 elevators.
According to a report released by consultancy firm EC Harris, Saudi Arabia is the cheapest country in the Middle East in which to build. It is half as expensive as Bahrain and over one-third cheaper than the United Arab Emirates.
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