Riyadh, Saudi Arabia – Saudi Arabia’s office market is experiencing a period of remarkable expansion and tight supply, particularly in its two largest commercial centers, Riyadh and Jeddah, according to JLL’s latest ‘KSA Office Market Dynamics’ report for Q2 2025. The report reveals a landscape dominated by landlord-favorable conditions and exceptionally low vacancy rates across prime and Grade A office spaces in the two cities.

Riyadh’s prime office spaces registered a low 0.5% vacancy rate in Q2 2025. Grade A and B segments in Riyadh also maintained constrained vacancy rates of 3.8% and 2.9% respectively, while Jeddah mirrored this trend with Grade A and B vacancies at 3.3% and 2.2% respectively.

Strong occupier demand in both Riyadh and Jeddah has fueled significant rental surges. Prime rents in Riyadh climbed 7.3% year-on-year to reach SAR 3,630 per sq. m. per annum, with King Abdullah Financial District (KAFD) exceeding SAR 4,000 per sqm, reflecting strong demand for quality space in Riyadh. Jeddah also saw healthy rental growth across the market spectrum, with Grade A rents increasing by 4.3% to SAR 1,393 per sqm and Grade B rents growing by 6.5% to SAR 933 per sqm.

In contrast, the Dammam Metropolitan Area (DMA) presented a different market dynamic. Despite substantially higher vacancy rates for Grade A (17.2%) and Grade B (21.4%) office spaces, the market, comprising government offices and owner-occupied buildings, remained landlord-favored. Grade A rents in DMA increased by 8.2% year-on-year, reaching SAR 994 per sqm per annum in Q2 2025.

Saud Al Sulaimani, Country Lead and Head of Capital Markets at JLL Saudi Arabia, said: “The continued expansion of the KSA office market directly reflects the Kingdom's strategic vision for economic diversification and urban development. Riyadh's sustained performance, driven by a flight to quality and the Regional Headquarters Program, solidifies its position as a key business hub. With a diversifying occupier base and expanding flexible workspace options, we are witnessing a dynamic and maturing market where landlords are strategically adapting to meet evolving tenant needs for enhanced amenities and services.”

Primarily concentrated in the city centre, Riyadh’s total office stock reached 8.1 million sqm in Q2 2025, with an additional 0.66 million sqm expected by year-end. The high demand has seen residential assets being converted to office space across the city, and new occupiers relocate to the less congested northern parts. The capital’s occupier base is also diversifying, with notable leasing activity over the last quarter from non-traditional sectors such as healthcare, pharmaceuticals, and technology.

Meanwhile, Jeddah added 81,887 sqm of new office space in H1 2025, increasing total stock to 2.97 million sqm, with a further 42,680 sqm of GLA expected to be completed in the second half of the year.

About JLL

For over 200 years, JLL (NYSE: JLL), a leading global commercial real estate and investment management company, has helped clients buy, build, occupy, manage and invest in a variety of commercial, industrial, hotel, residential and retail properties. A Fortune 500 company with annual revenue of $20.8 billion and operations in over 80 countries around the world, our more than 111,000 employees bring the power of a global platform combined with local expertise. Driven by our purpose to shape the future of real estate for a better world, we help our clients, people and communities SEE A BRIGHTER WAYSM. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com

About JLL MEA

Across the Middle East and Africa (MEA) JLL is a leading player in the real estate and hospitality services markets. The firm has worked in 35 countries across the region and employs over 2000 internationally qualified professionals across its offices in Dubai, Abu Dhabi, Riyadh, Jeddah, Al Khobar, Cairo, Casablanca, Cape Town, Johannesburg and Nairobi. For further information, visit jll-mena.com

Media Contact:
Medha Sandrasagara
JLL MEA
Medha.Sandrasagara@jll.com

Reem AlTajer | Janine Alamir

Burson

reem.tajer@bursonglobal.com | janine.alamir@bursonglobal.com