Real estate boom in Makkah raises value of deals by $10mln in a year

The number of real estate deals in Saudi Arabia last year was about 277,924 real estate deals

  
An aerial view of Kaaba at the Grand mosque in the holy city of Mecca, Saudi Arabia August 12, 2019. Image for illustrative purposes.

An aerial view of Kaaba at the Grand mosque in the holy city of Mecca, Saudi Arabia August 12, 2019. Image for illustrative purposes.

REUTERS/Umit Bektas

MAKKAH — Contrary to expectations, real estate movement recorded an unexpected recovery in Makkah Al-Mukarramah during the past year despite the negative impact on the markets due to COVID-19 pandemic, which confirms that Makkah is an investment destination for businessmen and investors.

According to the reports and indicators of the Ministry of Justice, the value of financial transactions for real estate deals increased during 2020 to approximately SR901.48 million, an increase of 4.31% over 2019, which amounted to SR864.24 million at that time.

The increase is approximately SR37.24 million in the value of transactions within one year. The number of real estate deals in Saudi Arabia last year was about 277,924 real estate deals, of which 9,333 deals was Makkah Al-Mukarramah’s share. The share of Makkah’s market equals 3.36% of total real estate deals executed in all regions of the Kingdom during the past year 2020.

This increase is a result of Vision 2030 initiatives, which aims to facilitate hosting an increasing number of Umrah performers visiting from abroad to reach 30 million by 2030. Work is currently under way to establish many projects in Makkah Al-Mukarramah to achieve the goals of the vision in raising the efficiency of hospitality, as well as, raising the quality of life.

From this standpoint, the private sector initiated their work in Makkah’s real estate market to support and enhance the goals of Vision 2030 with a number of huge and important projects.

The most prominent of Makkah’s development boom is "Thakher Makkah" project, designed and developed by some of the best in field international and local companies, which is considered to be one of the largest real estate projects existing in Saudi Arabia.

The land area of the project land is 320,000 square meters, and the built-up area is around 3.4 million square meters. Thakher Makkah hosts around 85 hotel towers, 10 hotel apartment towers, and 8 residential towers, accommodating about 200,000 guests. The project is distinguished by its proximity to the Holy Mosque in Makkah Al-Mukarramah by a distance of no more than 1,300 meters.

Makkah nowadays is distinguished by the diversity of mega real estate projects undergoing within it, such as Jabal Omar project, which is being built on a total area of 230,000 square meters. The mixed-use project includes 40 hotel towers that hosts apartments, luxury residential units, international hotels, and commercial markets.

“Makkah Gate” is among the many undergoing projects in Makkah. It is the first suburban project owned by the Holy Capital’s Municipality through its investment subsidiary. The project provides an ambitious and practical vision for the development of the western suburb of Makkah, which is about 12 kilometers from the west and is the main gateway to enter Makkah.

The project is located on a land area of approximately 8,300 square meters, and upon completion, it will accommodate more than half a million people by 2022. The project includes several residential neighborhoods, a university, a medical city, a complex for government departments, museums, and a huge wild park.

"Jabal Khandama" is another addition to the huge development boom in Makkah. The total built-up area is estimated at 910,000 square meters, and it is expected to be completed by the end of 2030. The number of floors of the project is expected to reach about 88 floors, with an estimated height of 450 meters.

As for the "Jabal Al Sharashef" development project, which has built-up area of 1.6 million square meters, it aims to reconfigure the urban environment of the neighborhood on the basis of comprehensive and coherent plans that include all aspects of the built environment, such as urban formation, housing, transportation networks, utilities, and public services. The hosting capacity is estimated to accommodate about 190,000 seasonal hotel residents and 650,000 permanent residents.

"Kudai Towers" project has its works underway as part of the development boom. The project is about 1.7 kilometers away from the Holy Mosque. Kudai Towers is comprised of 12 hotel towers, 10 of which are planned to be 4-star hotels and consists of 30 floors, while 2 of them will be 5-star hotels that consists of 45 floors. The project’s capacity is 10,000 luxury hotel rooms, and it will have 4 helipads, 70 restaurants, and the largest dome in the world sitting at the top of the project.

The recent real estate boom in Makkah Al-Mukarramah contributed to the increase in the number of real estate offices by 32.76% during the past year in 2020, bringing the total of specialized real estate offices operating in Makkah to 154 offices, compared to 116 offices by the end of 2019. This increase in specialized real estate services only confirms the recovery of real estate movement in Makkah. — SG


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