Saudi Arabia’s real estate challenge needs to be solved sustainably

After all, it’s safe to say that quality of life is the very basis of a well-functioning society.

This elemental need is gaining urgency as demographic, economic and mobility trends show more people converging on urban areas now and for decades to come. Right now, about half the world’s people live in cities, and many forecasters project that by 2050, that number could rise as high as 80 percent.

To put that data in perspective, by mid-century the global population is expected to reach at least nine billion – and a whopping seven billion of us will be urban dwellers.

Home sustainable home in Saudi Arabia

We’re already seeing this growth dynamic in Saudi Arabia, whose population has increased by 10 million in just 20 years. With over half of all Saudis below age 30, the need to invest in housing is tremendous. The transformation strategy Vision 2030, which primarily aims to diversify the national economy, calls for Saudi homeownership to reach 70 percent by the end of the decade. To achieve that goal, all qualified buyers need access to ample, quality housing and financial assistance.

But a new paradigm is also needed.

Around the world and across the socioeconomic spectrum, city housing too often goes wrong. Substandard materials and workmanship, overcrowding, lack of amenities, poor planning and little if any green space can drastically reduce quality of life. In short, with mass migration underway, the clock is ticking on getting urban housing sorted.

Done right, home sweet urban home can be a sustainable one if planned, built and maintained with the right infrastructure, innovation and services for long-term, positive impact. And jobs can be created in the process.

Here’s our plan.

Local meets global

PIF, Saudi Arabia’s sovereign wealth fund and Vision 2030’s diversification engine, launched ROSHN, a new national real estate developer, specifically to address urbanisation by developing best-in-class housing within integrated communities – a move that addresses national mandates to increase housing and create or expand sectors, including real estate, construction and infrastructure.

ROSHN’s 10-year plan to develop more than 200 million square metres in nine cities was launched in late 2020.

What’s different about ROSHN starts with the master plan itself. It is focused heavily on lifestyle, community facilities, and walkability aspects that encourage community engagement, followed by architecture that weds the best of local and international, combining global best practices in design and construction with aspects of Saudi heritage (reflected in the ROSHN name, which refers to Arabia’s ancient, hand-carved shutters that offer privacy while admitting cool breezes).

Integration: Key to viability

Sedra, ROSHN’s flagship neighbourhood in northern Riyadh, will feature more than 30,000 houses over 20 million square metres. Integration is woven into Sedra on multiple levels to underpin a satisfying daily life.

The architecture, for example, is influenced by the traditional Salmani architectural style, with a contemporary interpretation to recognise Saudi Arabia’s past, and build on a visionary future. This clean, streamlined style easily accommodates innovation and technology for modern living – seen in the housing types serving a range of resident needs.

Sustainability and lifestyle considerations are clearly seen in the Sedra master plan, where foot/bike paths and e-scooter hubs ensure that mosques, schools, shopping and other amenities are a short distance away.

Green spaces are often overlooked in urban neighbourhoods. Parks, water features and nature trails are proven health and mood boosters, and they can improve sustainability by mitigating pollution and heat. Sedra’s wadi, or riverbed, creates a structural backbone that lets residents enjoy nature.

This integrated approach will also be applied to Alarous, ROSHN’s second community being developed in Jeddah.

Housing as economic catalyst

Last but not least, sustainable urban housing can promote economic resilience and growth by creating jobs and contributing to GDP. Strategic partnerships between real estate investors and the private sector will strengthen construction and infrastructure sectors and promote workforce development, knowledge/technology transfer and local content.

Additionally, maximising the land bank’s value attracts capital from local and foreign investors.

And very importantly, PIF ensures access to long-term financing at a lower rate, as the owner of the Saudi Real Estate Finance Company – thus helping develop the housing finance market.

It’s all about the people

Clearly, one size does not fit all when it comes to planning a cohesive, resilient residential community – given the complexity of a city’s many components, its unique nature, and the varying needs and goals of the community itself.

But carefully coordinated planning, executed by the right public- and private-sector partners, can create residential compounds with more convenient facilities and features, more efficient buildings and better infrastructure and land use, to include well-maintained green spaces.

All of which come down to the people these communities serve.

As Saudi Arabia continues its economic and social transformation, this new approach to urban housing can create a quality of life that fits citizens’ aspirations, with strong economic, social and financial returns – now and for the future.

After all, happiness begins at home.