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RIYADH: ����ֱ��’s ongoing economic diversification push is energizing its property market, with office rents in Riyadh climbing 15 percent year on year and occupancy hitting 98 percent, CBRE said. 

Backed by $1.55 trillion in potential long-term investments and major reforms such as the expanded white land tax and a five-year rent freeze. 

In its Q3 2025 ����ֱ�� Real Estate Market Review, CBRE said the office sector continues to drive momentum, buoyed by the Kingdom’s non-oil economic expansion and an influx of multinational companies relocating regional headquarters to Riyadh. 

Strengthening the property market is central to Vision 2030, as the Kingdom works to position itself as a global business and tourism hub. The Real Estate General Authority forecasts the sector will reach $101.6 billion by 2029, expanding at an 8 percent compound annual growth rate from 2024. 

Matthew Green, head of research at CBRE for the Middle East and North Africa region, said: “����ֱ��’s real estate market is currently moving through a major transformation phase, amidst significant regulatory reforms, and sustained strategic investments, creating a dynamic environment for investors, developers, and occupiers alike.” 

According to the report, the Kingdom’s regional headquarters program is playing a key role in the office sector’s expansion, with 34 new licenses issued in the second quarter, bringing the total to 634. 

The initiative offers incentives including a 30-year corporate income tax exemption and withholding tax relief, along with regulatory support for multinationals operating in the Kingdom. 

Demand is strongest in the technology, financial, and health care sectors, with limited supply prompting some firms to secure office space through early pre-leasing arrangements, CBRE said. 

The King Abdullah Financial District remains at the center of Riyadh’s real estate expansion, with plans to double its footprint and accommodate 40,000 daily visitors. Infrastructure upgrades — including the reactivation of the 3.6-km monorail — are further enhancing KAFD’s appeal as a “10-minute city.” 

Policy interventions 

CBRE highlighted three major policy measures expected to boost the real estate sector’s growth trajectory. 

The new ownership law for non-Saudis, announced in July and set to take effect in January 2026, will open the market to foreign investors, supporting the Kingdom’s goal of attracting $100 billion in annual foreign direct investment by the end of the decade. 

The expanded white land tax, first announced in April and detailed in August, introduces a tiered rate structure targeting more than 411 million sq. meters of undeveloped land, aimed at curbing speculation and encouraging development. 

Additionally, the five-year rent freeze in Riyadh, effective since September, is expected to stabilize costs for residents and businesses, enhancing the capital’s competitiveness as a global business hub. 

“����ֱ��’s development pipeline remains vast, with $440 billion in committed projects and $1.55 trillion in potential long-term investments,” CBRE said, adding that giga-projects such as Neom and Qiddiya City dominate the pipeline. 

It added that Riyadh’s Expo 2030 preparations and municipal restructuring underscore a strategic push toward urban transformation. 

Residential, retail and hospitality sectors 

The report said residential transactions increased 17.9 percent quarter on quarter in the third quarter of 2025, reaching a total value of SR7.7 billion ($2.05 billion). 

In Riyadh, apartment prices rose 6.3 percent year on year in the third quarter, while villa prices increased by 11.6 percent over the same period. 

The retail sector’s performance was buoyed by stronger consumer spending so far this year, with sales volumes expected to grow at a compound annual rate of 4.4 percent through 2027. However, rental growth remained modest over the past 12 months, reflecting balanced market conditions.

����ֱ��’s retail pipeline includes 800,000 sq. meters of new space, with 100,000 sq. meters due by year-end. Major developments such as Westfield Riyadh, Bellevue Riyadh, and Avenues Mall are scheduled for completion between 2026 and 2027. 

In hospitality, revenue per available room rose 11 percent year on year in August, supported by an equivalent 11 percent increase in occupancy rates. 

In the industrial segment, Riyadh’s logistics rents continue to rise, led by Al Faisaliyah and Al Mashael districts, where rents reached SR299 per sq. meter per year. 

Jeddah’s Asfan submarket recorded the highest national rent at SR350 per sq. meter annually, despite more moderate growth overall.