Only 1% of Saudi projects cancelled - research

Only four percent of a total value of $543bn projects in Saudi Arabia had been put on hold or cancelled since the economic crisis hit the kingdom, according to research released on Sunday.

A total of 460 projects with a budget of close to $289bn were already under construction across Saudi Arabia’s real estate, leisure and entertainment and infrastructure sectors, said the report by Dubai research firm Proleads.

Most of the remainder of the 812 projects studied by Proleads were either in active planning, study, design or bidding stage, according to the firm.

A further 30 projects – or one percent by value – had been cancelled and only 25 – or three percent by value – were on hold, according to the research.

“Compared with other parts of the Gulf, the Saudi Arabian civil construction market is in a much healthier state because it reflects more closely local population demand and growth,” said Deep Marwaha, event director of Cityscape Saudi Arabia, which opened in Jeddah on Sunday.

Cash flow on real estate projects in the kingdom maintained a closer balance with spending on infrastructure, said the report.

“While civil construction in other Gulf countries has been dominated by a volatile domestic real estate sector, in Saudi Arabia it has been more balanced with the government’s budget for infrastructure keeping pace with that of real estate,” Marwaha added.

Demand for housing is being fuelled by rapid growth of Saudi’s domestic population.

It is estimated that as many as 1.5 million new housing units are required in the kingdom over the next five years.

Only 35 percent of Saudis own their own home, according to recent research by UK-based The Architect’s Journal.

According to a similar Proleads report published in May, only 2.4 percent of 1,289 construction projects worth $1.28 trillion which were under way in the UAE at the start of the year had been cancelled.

The same company valued Qatar's civil construction projects at $82.5bn at the end of March this year in another report released in April.

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