Retail space demand in Riyadh drives 4.2% rent increase in Q3: Knight Frank

The report also highlighted a 4.2 percent year-on-year rise in average rental rates, which reached SR2,845 ($757.24) per sq. meter. Shutterstock

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Updated 08 December 2024

Nirmal Narayanan

December 08, 2024 13:30

Retail space demand in Riyadh drives 4.2% rent increase in Q3: Knight Frank

Prime locations like Riyadh Park and Al Nakheel Mall have maintained near-full occupancy
Supply of retail space in the capital grew with the addition of 22,500 sq. meters

Updated 08 December 2024

Nirmal Narayanan

December 08, 2024 13:30

RIYADH: The retail market in Riyadh saw a five-percentage-point increase in occupancy rates, reaching 92 percent by the end of the third quarter, according to a new report by Knight Frank.

The report also highlighted a 4.2 percent year-on-year rise in average rental rates, which reached SR2,845 ($757.24) per sq. meter.

This increase reflects the city’s growing appeal as part of Saudi Arabia’s Vision 2030, aiming to transform Riyadh into a leading business and tourist hub.

“Over the last 12 months, the retail market in Riyadh has experienced a steady rise in rental rates, particularly in well-located regional and super-regional malls,” Knight Frank stated.

The firm pointed to prime locations like Riyadh Park and Al Nakheel Mall, which have maintained near-full occupancy thanks to their strategic positions, diverse tenant mix, and entertainment offerings.

Meanwhile, the supply of retail space in Riyadh grew with the addition of 22,500 sq. meters, bringing the city’s total retail space to 4.3 million square meters by 2026, a 21 percent increase.

“Riyadh’s retail market is growing along key corridors like King Fahd Road, Olaya Street, and northern districts, driven by urban expansion and rising consumer spending,” Knight Frank said.

In comparison, Jeddah’s retail market saw a more modest increase in rental rates of 1.2 percent, reaching SR2,525 per sq. meter. However, occupancy in the city declined slightly by 1 percentage point to 86 percent.

The report noted that Jeddah’s retail market is undergoing shifts influenced by changing consumer preferences and an increased supply of retail space.

Jeddah’s retail stock is expected to grow by 475,000 sq. meters by 2026, bringing the total to 3.3 million sq. Meters.

In Dammam, occupancy remained stable at 90 percent, but rental rates saw a slight decline of 0.7 percent, reaching SR2,285 per sq. meter. Despite this, demand for high-traffic locations remains steady.

Retail stock in Dammam stands at 1.28 million sq. meters and is expected to reach 1.3 million sq. meters by 2026.

“Dammam and Al Khobar are seeing a rise in diverse entertainment options, reflecting the Kingdom’s goal to create engaging, family-friendly retail that incorporates both leisure and community interaction,” Knight Frank added.

Topics: Knight Frank real estate rental

COP16: World Bank launches drought risk and resilience platform to address global crisis

Updated 9 sec ago

Nadin Hassan

December 10, 2024 16:54

COP16: World Bank launches drought risk and resilience platform to address global crisis

Updated 9 sec ago

Nadin Hassan

December 10, 2024 16:54

RIYADH: A new platform designed to help governments monitor and manage drought risks has been launched by the World Bank at COP16 in Riyadh, as concerns over the global impact of water scarcity grows.

The Drought Risk and Resilience Assessment aims to strengthen decision-making frameworks and governance for to help tackle this growing issue.

The platform is designed to provide governments with tools to better understand droughts, create mechanisms for ongoing action, and anticipate and manage future risks.

It comes after Saudi Arabia used COP16 to announce the Riyadh Global Drought Resilience Partnership, which aims to provide early warning systems, training, and capacity building for 80 countries most vulnerable to a lack of water.

Speaking at the meeting of the Convention to Combat Desertification, the World Bank’s Global Director of Water Saroj Kumar Jha said his institution’s platform will be “built on international best practices,” harnessing expertise from governments, scientists, and practitioners.

“Droughts do not occur suddenly but develop gradually over time,” he said. “What is important is that we need a system by which different parts of the government are able to collect the data.”

Jha added that most developing countries lack national drought monitors to systematically collect data on factors such as soil, crops, water, rainfall, temperature, humidity, and weather.

He emphasized that establishing these monitors would become a key focus area moving forward.

Osama Faqeeha, Saudi Arabia’s deputy minister of environment, highlighted the global urgency of addressing droughts, noting that projections suggest more than half of the world’s population could face water scarcity in the coming decades.

He pointed to the increasing spread of droughts to new regions, particularly Latin America, where 35 percent is now exposed to the phenomenon.

“What the outlook is telling us is that maybe this number is expected to double or even more,” Faqeeha said. He also warned about the economic and social consequences of drought, including its impact on food prices, migration, and economic stability.

The deputy minister also emphasized that 80 percent of the impact of water scarcity falls on agricultural communities, particularly small-scale farmers. He called for more global action to combat drought, underscoring that Saudi Arabia has long relied on innovative approaches to water management.

“We have to realize that 90 percent of freshwater is in soil, not in the rivers, not in the lakes — it’s in the soil, and when drought hits, the soil dries and life is taken away from it,” Faqeeha said, adding that every dollar put in resilience and preparedness saves $5 to $10 from the response.

Global call to action

Speakers at COP16 emphasized the interconnected nature of the crisis and the urgent need for collaborative solutions.

Valerie Hickey, global environment director at the World Bank, highlighted the economic toll of environmental degradation, saying: “Globally, since 1995, the world has lost 20 percent of its natural capital per capita,” she said, adding that land degradation alone costs the global economy 10 percent of its gross domestic product annually.

The Kingdom’s efforts to tackle the issue also align with broader environmental goals, including its Saudi and Middle East Green Initiatives, which aim to combat desertification and expand vegetation cover.

Ayman Ghulam, CEO of the National Center of Meteorology, elaborated on Saudi Arabia’s proactive response to the challenges posed by sand and dust storms, which are worsening due to climate change.

These include a dedicated regional center focusing on monitoring and mitigating the effects of storms, while the Climate Change Center addresses broader environmental impacts.

The cloud seeding program, another critical initiative, works to enhance rainfall and combat aridity, supporting water resource management and reducing the vulnerability of affected areas.

“These efforts demonstrate the Kingdom’s commitment to sustainable development, environmental conservation and addressing the challenges of climate change and sand and dust storms, and drought and land degradation,” Ghulam said.

Faqeeha urged global stakeholders to act decisively. “The time to act is now,” he said, emphasizing that resilience requires partnerships across governments, NGOs, and the private sector.

By fostering collaboration and leveraging innovative solutions, the initiatives announced at COP16 aim to address one of the most pressing global challenges.

Topics: COP16 Green & Blue World Bank Drought

Closing Bell: Saudi main index continues upward trend, closes at 12,194

Updated 29 min 6 sec ago

Nirmal Narayanan

December 10, 2024 16:20

Closing Bell: Saudi main index continues upward trend, closes at 12,194

Parallel market Nomu edged up by 54.76 points to close at 31,557.61
MSCI Tadawul Index gained 15.72 points to 1,532.32

Updated 29 min 6 sec ago

Nirmal Narayanan

December 10, 2024 16:20

RIYADH: Saudi Arabia’s Tadawul All Share Index continued its upward trend for the third consecutive day on Tuesday, as it gained 96.24 points or 0.80 percent to close at 12,193.64.

The total trading turnover of the benchmark index was SR6.95 billion ($1.85 billion), with 110 of the listed stocks advancing while 118 declining.

The Kingdom’s parallel market Nomu also edged up by 54.76 points to close at 31,557.61, while the MSCI Tadawul Index gained 15.72 points to 1,532.32.

Anaam International Holding Group was the best-performing stock of the day. The company’s share price surged by 6.77 percent to SR1.42.

Saudi Research and Media Group was another top gainer, with the firm’s share price increasing by 4.23 percent to SR286.

The share price of Makkah Construction and Development Co. also rose by 4.20 percent to SR119.

Conversely, the share price of Banan Real Estate Co. slipped by 9.88 percent to SR7.39.

On Dec.10, shares of Jahez International Co. for Information Systems Technology debuted on Saudi Arabia’s main exchange. The company’s share price, however, slipped by 9.04 percent to SR34.20.

On the parallel market, Dar Almarkabah for Renting Cars Co. was the best performer, with its share price increasing by 13.42 percent to SR60.

Saad Hussain Bin Dajam Group announced that it received approval from the Kingdom’s Capital Market Authority to float 2.05 million shares, or 20 percent of the firm’s capital on Nomu.

According to a statement, the offer will be confined to qualified investors stipulated in the glossary of defined terms used in the CMA regulations and rules.

The statement added that the authority’s approval is valid six months from the resolution date.

The CMA also approved the request of Twareat Medical Co. to register its shares on the parallel market.

Established in Khobar in 2010, the firm provides medical care services across the Kingdom, including emergency medicine, radiology, dermatology, and pediatrics.

Topics: Closing Bell Saudi stock exchange Tadawul All Share Index (TASI)

Arab Fund to launch observatory to address water scarcity

Updated 9 min 3 sec ago

Reem Walid

December 10, 2024 15:34

Arab Fund to launch observatory to address water scarcity

Observatory will foster collaboration and attract investments to solve the region's urgent water management challenges
Fund reaffirmed its commitment to enhancing regional water and food security

Updated 9 min 3 sec ago

Reem Walid

December 10, 2024 15:34

RIYADH: The Arab Fund for Economic and Social Development is set to launch a new Water Observatory aimed at boosting investments in sustainable water solutions across the region. Announced at the 16th session of the UN Convention to Combat Desertification’s Conference of the Parties in Riyadh, this initiative is designed to improve data collection and accessibility on water-related projects.

The observatory will provide vital data and insights to stakeholders, helping them make informed decisions to address the growing challenges of water scarcity.

The initiative is aligned with the Arab Fund’s ongoing commitment to combat water scarcity, a critical issue in a region where 12 countries face severe water shortages, each with less than 500 cubic meters of water per capita annually.

“Addressing water scarcity requires billions in investments, but these resources must be strategically allocated to create meaningful, long-term impact,” said Merza Hassan, senior adviser to the chairman of the Arab Fund for Economic and Social Development.

“By collaborating with regional and global partners from the public and private sectors, as well as financial institutions, we can address overconsumption and ensure water sustainability for future generations.”

The fund’s statement emphasized that the observatory will foster collaboration and attract investments to solve the region's urgent water management challenges.

At COP16, the fund reaffirmed its commitment to enhancing regional water and food security, noting its support for the Riyadh Green Initiative. This is part of a broader $10 billion pledge by the Arab Coordination Group to promote sustainable development in the region.

In addition, the fund hosted two events. One focused on advancing water management policies, exploring innovative financing mechanisms, and fostering international partnerships. The other brought together private sector leaders to share strategies and experiences on successful water-related investments, emphasizing the essential role the private sector plays in addressing water scarcity.

Moreover, the Arab Fund held high-level bilateral meetings with ACG member states, senior government officials, and representatives from regional and global development organizations, including UN agencies. These discussions aimed to explore potential partnerships and co-financing opportunities to advance the Sustainable Development Goals across the Arab region.

To date, the Arab Fund has financed 671 projects totaling 10.72 billion Kuwaiti dinars ($34.87 billion), benefiting 22 countries.

Topics: COP16 Green & Blue Arab Fund

Lebanon dollar-denominated bond rally sparks hope for reforms

Updated 8 min 8 sec ago

Miguel Hadchity

December 10, 2024 14:43

Lebanon dollar-denominated bond rally sparks hope for reforms

Lebanon’s dollar-denominated bonds surged by 30% in 10 days, reaching 13 cents to the dollar
Bond rally has laid the groundwork for potential economic recovery by boosting confidence in Lebanon’s financial markets

Updated 8 min 8 sec ago

Miguel Hadchity

December 10, 2024 14:43

RIYADH: A rally in Lebanon’s dollar-denominated bonds a day after Syrian militant groups removed President Bashar Assad from power shows growing optimism for economic and governance reforms in the region, according to an expert.

Makram Makarem, a senior director at Beirut-based Investment and Capital Bank, told Arab News that the prospect of reduced external influence in Lebanon through Iranian proxies in Syria, as well as the weakening of Hezbollah, has boosted investor confidence.

Lebanon’s dollar-denominated bonds surged by 30 percent in 10 days, reaching 13 cents to the dollar on Dec. 9, data from Bloomberg Terminal showed.

At least nine of the country’s dollar bonds, maturing between 2026 and 2037, traded above 12 cents, a significant rise from their average for much of the year.

The 2029 bonds saw the largest increase, rising 2.03 cents to 12.76 cents on the dollar — the highest since December 2022, Reuters reported.

Although still significantly below face value, the bonds have rallied multiple times since Israel’s recent military strikes in Lebanon.

“This optimism stems from expectations of reduced political interference and greater focus on governance,” said Makarem.

The financial adviser at the Lebanese institution explained that the bond surge is driven by a combination of geopolitical and economic factors.

The removal of President Assad’s government has disrupted a crucial supply route for Hezbollah, the Iran-backed Lebanese militia designated as a terrorist group by the US.

He pointed out that this, coupled with growing expectations of a breakthrough in Lebanon’s long-stalled presidential election, has improved investor sentiment.

While the outlook is promising, Lebanon’s entrenched corruption and political inefficiencies pose challenges, requiring strong reforms and sustained international support for meaningful progress, he added.

On the economic front, Makarem underlined that ongoing state debt restructuring efforts and historical recovery rates for defaulted bonds, which typically range from 20 percent to 50 percent, “indicate that current bond levels are undervalued, with recovery estimates projected between 20 percent and 30 percent.”

Additionally, rising gold prices — which are positively correlated with Lebanon’s recovery prospects due to the country’s gold reserves — along with restructuring efforts in the banking sector, have raised growth expectations.

“However, sustaining this sentiment will depend on Lebanon’s ability to implement reforms and navigate its entrenched political and economic challenges,” he added.

Since Lebanon defaulted on its international debt in 2020, the nation has endured a severe economic crisis marked by hyperinflation, poverty, and political deadlock. With a caretaker government in place since 2022 and ongoing presidential election failures, significant reforms still need to be made.

The bond rally has laid the groundwork for potential economic recovery by boosting confidence in Lebanon’s financial markets.

“Lebanon’s broader recovery hinges on addressing systemic challenges like hyperinflation, a weak currency, and fragile institutions,” Makarem said, warning that without structural reforms and effective governance, the rally is unlikely to translate into sustained economic improvement.

Despite Lebanon’s dollar bonds nearly doubling from the average, as highlighted by Makarem, they remain almost 50 percent below their post-default highs, reflecting ongoing concerns about the country’s ability to achieve lasting financial stability and implement necessary reforms.

Topics: Lebanon Bond market Debt market Syria

PIF launches Adeera to redefine Saudi hospitality with local brands

Updated 6 min 43 sec ago

Miguel Hadchity

December 10, 2024 14:30

PIF launches Adeera to redefine Saudi hospitality with local brands

New venture aims to introduce a variety of local hotel brands designed to meet the needs of a diverse range of visitors
Adeera is poised to unlock new business opportunities within the Kingdom’s hospitality sector

Updated 6 min 43 sec ago

Miguel Hadchity

December 10, 2024 14:30

RIYADH: Saudi Arabia is making a significant move to develop its own homegrown hospitality brands with the launch of Adeera, a new hotel management company fully owned by the Public Investment Fund.

The new venture aims to introduce a variety of local hotel brands designed to meet the needs of a diverse range of visitors, from mid-range options to ultra-luxury accommodations.

As Saudi Arabia continues to position itself as a major global tourism destination, the launch of Adeera comes at a crucial time.

According to a press release, the company is poised to unlock new business opportunities within the Kingdom’s hospitality sector by focusing on the unique Saudi experience.

Adeera will work closely with hotel developers to maximize the involvement of the local private sector, creating a platform for the growth of homegrown hospitality brands.

Khalid Johar, co-head of PIF’s Local Real Estate Portfolio, emphasized the significance of the launch. “The timing of Adeera’s introduction aligns perfectly with Saudi Arabia’s expansion in hospitality and tourism. The company has the opportunity to help propel the sector forward by introducing innovative hotel brands, supporting the Kingdom’s growing reputation as a world-class tourism destination.”

Johar also highlighted that Adeera’s distinct focus on Saudi culture and traditions would give the company a competitive edge in a rapidly evolving market. The goal is to create an authentic Saudi hospitality experience that resonates with both local and international visitors, celebrating the Kingdom’s rich heritage while offering world-class service.

The launch of Adeera marks another key step in PIF’s broader efforts to diversify Saudi Arabia’s economy and drive sustainable growth.

The press release noted that this move follows several significant investments by PIF in the tourism and real estate sectors. These investments include the luxury boutique hotel company Boutique Group, which specializes in transforming historic and cultural palaces into upscale boutique hotels; Dan, an agri-tourism company; and Asfar, a tourism investment firm.

Saudi Arabia’s National Tourism Strategy is an ambitious plan aimed at attracting 150 million visitors and generating 10 percent of the country’s gross domestic product from tourism by 2030. PIF’s investments are aligned with this vision, focusing on strategic sectors such as infrastructure, real estate, technology, and renewable energy to help establish Saudi Arabia as a leading global investment hub.

In addition to strengthening local industries, PIF is also focused on fostering innovation, creating employment opportunities, and attracting international investment. Through these initiatives, the fund aims to ensure sustainable economic growth and enhance the Kingdom’s competitiveness on the global stage.

The Kingdom’s hotel sector is already experiencing significant growth. According to recent data from the Central Bank of Saudi Arabia, spending in hotels saw a notable week-on-week increase of 11.4 percent from Nov. 10 to 16, reaching SR399.7 million ($106.4 million).

This follows an 8.5 percent increase in hotel spending during the week of Oct. 13-19, despite a broader decline in point-of-sale transactions, as reported by SAMA.

This upward trend in hotel spending underscores the growing demand for high-quality accommodations and further highlights the potential for continued growth within the hospitality sector.

With Adeera, Saudi Arabia is poised to take a leading role in shaping the future of its hospitality industry, blending the best of modern hotel management with a deep respect for its cultural and historical roots.

Topics: PIF Saudi Arabia Saudi Arabia's Public Investment Fund (PIF)

Retail space demand in Riyadh drives 4.2% rent increase in Q3: Knight Frank

Retail space demand in Riyadh drives 4.2% rent increase in Q3: Knight Frank

Riyadh’s office space to see major expansion by 2026, driven by regional HQ program: Knight Frank

Saudi Arabia needs 115k new homes a year to meet 2030 homeownership target: Knight Frank

COP16: World Bank launches drought risk and resilience platform to address global crisis

COP16: World Bank launches drought risk and resilience platform to address global crisis

Saudi Arabia unveils Riyadh Action Agenda to address land restoration, drought

More funding needed for global land conservation, say experts at COP16

Closing Bell: Saudi main index continues upward trend, closes at 12,194

Closing Bell: Saudi main index continues upward trend, closes at 12,194

Closing Bell: Saudi main index closes in green at 12,097

Closing Bell: Saudi main index rises to close at 11,955

Arab Fund to launch observatory to address water scarcity

Arab Fund to launch observatory to address water scarcity

More funding needed for global land conservation, say experts at COP16

COP16: Over $12bn pledged for drought resilience and land restoration on 2nd day

Lebanon dollar-denominated bond rally sparks hope for reforms

Lebanon dollar-denominated bond rally sparks hope for reforms

PM: ‘Stability and reconstruction of southern Lebanon key to regional stability’

Hezbollah leader says $77m allocated to Lebanon war displaced

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PIF launches Adeera to redefine Saudi hospitality with local brands

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Retail space demand in Riyadh drives 4.2% rent increase in Q3: Knight Frank

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