Saudi Arabia has embarked on a massive USD 1.3 trillion real estate and infrastructure development drive over the past eight years. The move is part of an ambitious strategy to diversify the Kingdom’s economy away from its traditional oil dependency, aiming to transform the country into a hub for global investment, tourism, and innovation.
The sweeping initiative, which includes mega projects such as Neom and The Line, also seeks to improve the quality of life for Saudi citizens and create an attractive environment for living, working, and travelling.
Steady Growth In Development
According to the latest report from real estate consultancy firm Knight Frank, the volume of real estate and infrastructure projects in Saudi Arabia has risen by 4% over 2023. This marks significant progress in the Kingdom’s long-term strategy.
More than one million residential units are in development, alongside various high-profile, large-scale construction projects, many of which are designed to support a growing population and stimulate tourism and investment.
Since 2016, when Crown Prince Mohammed bin Salman unveiled his vision for a post-oil economy, the Kingdom has awarded approximately USD 164 billion worth of real estate contracts.
At the heart of this transformation is the futuristic Neom City project, set along the Red Sea coast. Neom has received $28.7 billion of that total, with a major focus on The Line, a pair of striking mirror-clad towers that will stretch 105 miles across the desert.
Neom is positioned to be one of the largest and most technologically advanced cities in the world. It serves as the flagship development of “Vision 2030,” a plan that envisions not only economic diversification but also the modernisation of Saudi society and infrastructure.
In addition to Neom, several other significant projects have been central to Saudi Arabia’s transformative plans. The National Housing Company has received USD 12 billion in development contracts to build new homes, while the historic Diriyah Gate is being revitalised with a USD 9 billion investment.
Diriyah, a UNESCO World Heritage site, is being developed into a cultural and entertainment hub, showcasing Saudi Arabia’s rich history and heritage.
Qiddiya, an entertainment megaproject near Riyadh, has garnered almost USD 7 billion. Once completed, Qiddiya will offer a vast array of entertainment, sports, and cultural attractions, aiming to establish Riyadh as a global entertainment capital.
Racing Against Time And Obstacles
Despite the progress, Saudi Arabia’s ambitious goals come with significant challenges. Mega projects like Neom, The Line, and Diriyah are still far from completion, and the Kingdom is working aggressively to overcome logistical hurdles such as supply chain bottlenecks, labour shortages, and rising construction costs. Saudi Arabia has set tight deadlines, with most developments scheduled to be completed between 2028 and 2030.
Knight Frank’s report highlights the kingdom’s determination to meet these targets, even as it positions itself to become the world’s largest construction market by the next decade. Riyadh remains a focal point of this activity, with contracts worth approximately USD 35 billion already awarded.
By 2030, the capital is expected to add 29,000 hotel rooms, 340,000 new homes, and 4.6 million square metres of office space. These developments are designed to accommodate the growing demands of both residents and visitors as the city prepares to host global events such as the World Expo in 2030 and the FIFA World Cup in 2034.
Western Seaboard And Giga Projects
Beyond the capital, Saudi Arabia’s western seaboard is also witnessing a construction boom, fuelled by investments exceeding USD 54 billion. This region, home to at least 17 “giga projects,” is critical to the Kingdom’s economic diversification and tourism goals. The development along the Red Sea coastline, with projects such as Neom and The Red Sea Project, is expected to turn this area into a premier destination for international travellers.
As part of its broader strategy, Saudi Arabia is targeting a massive increase in foreign direct investment (FDI) and tourism. By 2030, the Kingdom aims to attract USD 100 billion in FDI and host 150 million tourists annually. In 2023 alone, Saudi Arabia welcomed approximately 109 million tourists, although the majority were domestic visitors.
A USD 110 Billion Hotel Expansion
A key component of Saudi Arabia’s economic transformation is its hotel and hospitality sector, which is expected to undergo massive growth. The Kingdom plans to add 362,000 new hotel rooms by the end of the decade, at an estimated cost of USD 110 billion.
Knight Frank emphasises the need for a diverse range of accommodations, suggesting that more mid-market hotels, rather than exclusively four- and five-star properties, will be essential to capturing a broader segment of the global tourist market.
Ensuring this balance between luxury and affordability will be crucial for Saudi Arabia to meet its tourism targets and appeal to a wide range of visitors. The projected expansion is also expected to create substantial opportunities for investment in both tourism infrastructure and real estate.
A Vision For The Future
Saudi Arabia’s USD 1.3 trillion infrastructure push is not just about building new cities and hotels. It represents a bold effort to reposition the Kingdom on the global stage as a modern, diversified economy, less dependent on oil revenues and more focused on innovation, sustainability, and global connectivity. By the end of the decade, Saudi Arabia hopes to attract millions of tourists, billions in investment, and establish itself as a key player in global business, culture, and tourism.
While challenges remain, the kingdom’s relentless drive and significant financial backing underscore its determination to turn “Vision 2030” into a reality. If Saudi Arabia can meet its ambitious deadlines, the country is set to undergo one of the most significant transformations in the modern era, redefining its identity and role in the global economy.