Riyadh Real Estate Market Overview The second quarter Prepared by: Market Studies & Research Department

Transcription

1 Riyadh Real Estate Market Overview The second quarter 2016 Prepared by: Market Studies & Research Department July, 2016

2 Serial 1 1/1 1/2 1/3 1/4 1/5 1/6 1/7 * Contents Riyadh City Overview Riyadh Residential sector Land sector in Riyadh Riyadh Office sector Riyadh Retail (commercial) sector & shopping centers Riyadh Hotel sector Kingdom of Saudi Arabia s Vision 2030 (1452 H) White Land Fees CHESTERTONS Page No

3 1 Riyadh City Overview: 1 Riyadh population in 2004 (1425) 4,260,000 2 Riyadh population in 2016 (1437) 6,506,700 3 The percentage of Saudis in 2004 (1425) of the total population % 66 4 growth rate Population in Riyadh between ( ) % growth rate Population in Riyadh between ( ) % 4 6 The difference in population number in Riyadh between the years ( ) 2,246,700 7 Percentage of the population that their age is less than 15 years % 27 8 Percentage of Saudis in Riyadh % 64 9 Percentage of non Saudis in Riyadh % Indian nationality Percentage of total population % Pakistani nationality Percentage of totalpopulation % Percentage of house owners who have moved two or three times during their stay in Riyadh % Percentage of house owners who have moved four to five times during their stay in Riyadh % 10 1/1 Riyadh Residential Sector Overview: 1 The number of houses in Riyadh in in 2004 (1425) 704,000 2 The number of housing units in Riyadh in 2016 (1437) 1,217,996 3 Number of units built between ( ) 513,996 4 Number of families in Riyadh in in 2016 (1437) 1,116,339 5 Percentage of vacant housing units for the year 2016 % 8 6 Villas Percentage of total residential units for the year 2016 % 52 7 Apartments Percentage of total residential units for the year 2016 % 42 8 Local buildings percentage of total residential units for the year 2016 % percentage of Saudis who own their homes 2016 % Percentage of Saudis who build their own houses through personal funds 2016 % Percentage of Saudis who build their houses through the Real Estate Development Fund 2016 % Percentage of Saudis who build their houses through private companies such as banks and real estate companies 2016 % 21 2

4 1/1/1 Apartments average rents in Riyadh: 26,935 SR is the Overall average rent for the apartments in Riyadh City, this average differs in Riyadh depending on location. Table 1 Sector Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh Apartments rent (in SAR) lowest price average highest price average Overall average for every sector 20,650 29,800 25,225 24,286 37,714 31,000 28,700 43,250 35,975 18,700 25,250 21,975 16,895 24,105 20,500 Overall average 21,846 32,024 26,935 Overall average rent for apartments in Riyadh 26,935 Source: Field survey by CHESTERTONS Chart 1 50,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Average lowest prices Average Highest price The overall average for each sector 20,650 29,800 25,225 24,286 37,714 31,000 28,700 43,250 35,975 18,700 25,250 21,975 16,895 24,105 20,500 Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh 3

5 This table shows the apartments rental prices in Riyadh (in SAR) : Northern Riyadh Western Riyadh Al Falah 27,000 Laban 17,000 24,000 Al Aqiq 20,000 28,000 Irqah 18,000 25,000 Hittin 30,000 Al Khozama 30,000 50,000 Al Malqa 27,000 40,000 Al Nakheel 30,000 50,000 Al Nafl 22,000 35,000 Al Mohammadeyah 27,000 Al Sahafah 25,000 35,000 Al Rahmaniyah 25,000 Al Yasmin 22,000 40,000 Al Raid 17,000 24,000 Central Riyadh Eastern Riyadh At Taawun 27,000 Al Nasim Al Sharqi 35,000 Al Wahah 70,000 Al Nasim Al Gharbi 35,000 Al Masif 25,000 40,000 Al Nahdah 35,000 King Fahd 25,000 40,000 Ghirnatah 35,000 King Abdullah 30,000 Al Munsiyah 35,000 Salah Ad Din 30,000 Al Hamra 35,000 Al Izdihar 30,000 Al Yarmuk 35,000 Al Nuzhah 35,000 Al Qadisiyah 35,000 Al Muruj 27,000 40,000 Al Sulimaniyah 30,000 50,000 Southern Riyadh Al Wurud 30,000 Al Olaya 30,000 50,000 Al Fayha 20,000 30,000 Jarir 27,000 35,000 AL Shifa 15,000 22,000 Al Dhubbat 25,000 40,000 Al Marwah 15,000 19,000 Badr 15,000 18,000 Al Hada 30,000 Al Badi'ah 17,000 24,000 4

6 1/1/2 Villas average rents in Riyadh: SAR 118,668 is the overall average rent for villas in Riyadh, this average differs in Riyadh City depending on location. Table 2 Sector Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh Villas Rents (in SAR) lowest price average highest price average Overall average for every sector 84, , , , , , , , ,250 70, ,500 94,500 72, ,737 93,553 Overall average 90, , ,668 Overall average of villas rents in Riyadh 118,668 Source: Field survey by CHESTERTONS Chart 2 Average lowest prices Average Highest price The overall average for each sector 250, , , ,000 84, , , , , , , , ,250 70, ,500 94,500 72, ,737 93,553 50,000 0 Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh 5

7 This table shows the Villas rental prices in Riyadh (in SAR): Northern Riyadh Western Riyadh Al Falah 140, ,000 Laban 80, ,000 Al Aqiq 90, ,000 Irqah 80, ,000 Hittin 150, ,000 Al Khozama 140, ,000 Al Malqa 140, ,000 Al Nakheel 140, ,000 Al Nafl 90, ,000 Al Mohammadeyah 140, ,000 Al Sahafah 120, ,000 Al Rahmaniyah 140, ,000 Al Yasmin 100, ,000 Al Raid 150, ,000 Central Riyadh Eastern Riyadh Al Taawun 90, ,000 Al Nasim Al Sharqi 50,000 80,000 Al Wahah 120, ,000 Al Nasim Al Gharbi 60,000 90,000 Al Masif 90, ,000 Al Nahdah 70, ,000 King Fahd 90, ,000 Ghirnatah 80, ,000 King Abdullah 130, ,000 Al Munsiyah 70, ,000 Salah Ad Din 130, ,000 Al Hamra 90, ,000 Al Izdihar 130, ,000 Al Yarmuk 70, ,000 Al Nuzhah 130, ,000 Al Qadisiyah 70,000 90,000 Al Muruj 140, ,000 Al Sulimaniyah 150, ,000 Southern Riyadh Al Wurud 150, ,000 Al Olaya 150, ,000 Al Fayha 120, ,000 Jarir 90, ,000 AL Shifa 60,000 90,000 Al Dhubbat 120, ,000 Al Marwah 60,000 90,000 Badr 60,000 90,000 Al Hada 150, ,000 Al Badi'ah 70, ,000 6

8 1/1/3 Apartments average selling prices in Riyadh: SAR 441,656 is the overall average selling price for Apartments in Riyadh, this average differs in all sides of Riyadh depending on location. Table 3 Sector Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh Apartments selling prices (in SAR) lowest price average highest price average Overall average for every sector 336, , , , , , , , , , , , , , ,316 Overall average 351, , ,656 Overall average of apartments sales in Riyadh 441,656 Source: Field survey by CHESTERTONS Chart 3 Average lowest prices Average Highest price The overall average for each sector 700, , , , , , , , , , , , , , , , , , , , , ,000 0 Riyadh West Riyadh north Riyadh Central Riyadh east Riyadh South 7

9 This table shows the apartment selling price across Riyadh (in SAR): Northern Riyadh Western Riyadh Al Falah 600,000 Laban 270,000 Al Aqiq 350, ,000 Irqah 350,000 Hittin 700,000 Al Khozama 400, ,000 Al Malqa 400, ,000 Al Nakheel 400, ,000 Al Nafl 350, ,000 Al Mohammadeyah 400, ,000 Al Sahafah 400, ,000 Al Rahmaniyah 400, ,000 Al Yasmin 350, ,000 Al Raid 700,000 Central Riyadh Eastern Riyadh Al Taawun 400, ,000 Al Nasim Al Sharqi 270, ,000 Al Wahah 550, ,000 Al Nasim Al Gharbi 300,000 Al Masif 400, ,000 Al Nahdah 300,000 King Fahd 600,000 Ghirnatah 300, ,000 King Abdullah 700,000 Al Munsiyah 270,000 Salah Ad Din 400, ,000 Al Hamra 700,000 Al Izdihar 400, ,000 Al Yarmuk 300,000 Al Nuzhah 700,000 Al Qadisiyah 250, ,000 Al Muruj 400, ,000 Al Sulimaniyah Al Wurud Al Olaya 500, , , ,000 Southern Riyadh Al Fayha 350,000 Jarir 350, ,000 AL Shifa 300,000 Al Dhubbat 350, ,000 Al Marwah 250, ,000 Badr 250, ,000 Al Hada 350,000 Al Badi'ah 300,000 8

10 1/1/4 Villas average selling prices in Riyadh: SAR 1,787,926 is the overall average selling price of villas in Riyadh. Table 4 Sector Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh The average lowest price Villas Sales (in SAR) the average highest price Overall average for every sector 1,490,000 2,010,000 1,750,000 1,678,571 2,221,429 1,950,000 1,589,000 2,615,000 2,102,000 1,480,000 1,990,000 1,735,000 1,126,316 1,678,947 1,402,632 Overall average 1,472,777 2,103,075 1,787,926 Overall average selling price of villas in Riyadh 1,787,926 Source: Field survey by CHESTERTONS Chart 4 Average lowest prices Average Highest price The overall average for each sector,000 2,500,000 2,000,000 1,500,000 1,490,000 2,010,000 1,750,000 1,678,571 2,221,429 1,950,000 1,589,000 2,615,000 2,102,000 1,480,000 1,990,000 1,735,000 1,126,316 1,678,947 1,402,632 1,000, ,000 0 Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Southern Riyadh 9

11 This table shows Villas selling prices across Riyadh (in SAR) : Northern Riyadh Western Riyadh Al Falah 1,800,000 2,500,000 Laban 1,300,000 1,700,000 Al Aqiq 1,600,000 1,900,000 Irqah 1,600,000 2,000,000 Hittin 1,900,000,000 Al Khozama 2,000,000,000 Al Malqa 1,800,000 2,400,000 Al Nakheel 2,000,000,000 Al Nafl 1,600,000 2,000,000 Al Mohammadeyah 1,800,000 2,400,000 Al Sahafah 1,700,000 2,200,000 Al Rahmaniyah 1,800,000 2,400,000 Al Yasmin 1,700,000 2,200,000 Al Raid 2,000,000,000 Central Riyadh Eastern Riyadh Al Taawun 1,600,000 2,500,000 Al Nasim Al Sharqi 1,200,000 1,700,000 Al Wahah 2,000,000,000 Al Nasim Al Gharbi 1,300,000 1,700,000 Al Masif 1,500,000 2,200,000 Al Nahdah 1,400,000 1,800,000 King Fahd 1,500,000 2,200,000 Ghirnatah 1,500,000 2,000,000 King Abdullah 1,800,000,000 Al Munsiyah 1,400,000 1,900,000 Salah Ad Din 1,800,000,000 Al Hamra 1,900,000 2,500,000 Al Izdihar 1,700,000 2,500,000 Al Yarmuk 1,500,000 2,000,000 Al Nuzhah 1,700,000 2,500,000 Al Qadisiyah 1,200,000 1,600,000 Al Muruj 1,800,000,000 Al Sulimaniyah Al Wurud Al Olaya 180,000 1,800,000 1,800,000,000,000,000 Southern Riyadh Al Fayha 1,300,000 2,000,000 Jarir 1,500,000 2,500,000 AL Shifa 900,000 1,400,000 Al Dhubbat 1,600,000 2,500,000 Al Marwah 900,000 1,400,000 Badr 900,000 1,300,000 Al Hada 1,900,000 3,500,000 Al Badi'ah 1,400,000 1,800,000 10

12 1/2 Land prices in Riyadh: 1/2/1 Selling Price for Residential land with single street frontage: Overall average selling price for Residential land overlooking on one street frontage in Riyadh is 2,150 SR/m 2. Table 5 Sector Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Residential land with single street frontage (in SAR) lowest price average highest price average average Overall for every sector 1,750 2,000 1,875 1,700 1,850 1,775 2,400 2,750 2,575 2,200 2,600 2,400 The general average 2,000 2,300 2,150 Overall average selling price for Residential land with single street frontage in Riyadh Source: Field survey by CHESTERTONS Chart 5 2,150 Average lowest prices Average Highest price The overall average for each sector 2,500 2,000 1,750 2,000 1,875 1,700 1,850 1,775 2,400 2,750 2,575 2,200 2,600 2,400 1,500 1, Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh 11

13 This table shows the selling prices for Residential land with single street frontage, across Riyadh (in SAR): Northern Riyadh Western Riyadh Al Falah 2,500 Laban 900 1,400 Al Aqiq 2,100 2,400 Irqah 1,700 1,900 Hittin 2,800 3,300 Al Khozama 3,500 Al Malqa 2,400 2,700 Al Nakheel 2,700 3,200 Al Nafl 2,100 2,600 Al Mohammadeyah 2,800 3,500 Al Sahafah 2,400 2,700 Al Rahmaniyah 2,800 Al Yasmin 2,200 2,500 Al Raid 2,500 Central Riyadh Eastern Riyadh Al Taawun 2,300 2,900 Al Nasim Al Sharqi 1,100 1,200 Al Wahah 3,500 3,900 Al Nasim Al Gharbi 1,100 1,400 Al Masif 2,000 2,600 Al Nahdah 2,200 2,400 King Fahd 2,200 2,500 Ghirnatah 1,650 1,850 King Abdullah 2,300 2,900 Al Munsiyah 2,400 2,700 Salah Ad Din 2,500 Al Hamra 1,850 2,300 Al Izdihar 2,700 3,300 Al Yarmuk 1,700 2,400 Al Nuzhah 2,800 3,300 Al Qadisiyah 1,100 1,200 Al Muruj 3,400 Al Sulimaniyah 2,700 Southern Riyadh Al Wurud 2,600 Name district Al Olaya 2,700 3,300 Manfuhah 1,100 1,200 Jarir 2,100 2,300 Ash Shifa 1,100 1,300 Al Dhubbat 2,500 2,900 Al Marwah 1,000 1,100 Utaiqah 1,000 1,200 Al Hada 2,100 2,300 Al Badi'ah

14 1/2/2 Selling Prices for Residential land with main road frontage and return: Overall average selling price for Residential land with main road frontage and return in Riyadh is 2,463 SR/m2. Table 6 Sector Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh Residential land with main road frontage and return (in SAR) average lowest average highest price price Overall average for every sector 1,900 2,800 2,350 1,900 2,250 2,075 2,600 2,900 2,750 2,500 2,900 2,700 The general average 2,225 2,700 2,463 Overall average selling price for Residential land with main road frontage and return in Riyadh City 2,463 Source: Field survey by CHESTERTONS Chart 6 2,500 2,000 1,750 2,000 1,875 1,700 1,850 1,775 2,400 2,750 2,575 2,200 2,600 2,400 1,500 1, Western Riyadh Northern Riyadh Central Riyadh Eastern Riyadh 13

15 This table shows selling prices for Residential land with main road frontage and return, across Riyadh (in SAR): Northern Riyadh Western Riyadh Al Falah 2,700 3,400 Laban 1,000 1,500 Al Aqiq 2,400 2,700 Irqah 1,900 2,400 Hittin 3,800 Al Khozama 3,500 3,800 Al Malqa 2,700 3,400 Al Nakheel 3,200 4,000 Al Nafl 2,600 2,700 Al Mohammadeyah 3,200 3,800 Al Sahafah 2,500 2,800 Al Rahmaniyah 3,500 Al Yasmin 2,500 2,800 Al Raid 3,500 Central Riyadh Eastern Riyadh Al Taawun 2,500 3,200 Al Nasim Al Sharqi 1,200 1,300 Al Wahah 4,000 4,500 Al Nasim Al Gharbi 1,200 1,500 Al Masif 2,300 2,800 Al Nahdah 2,400 2,700 King Fahd 2,400 2,800 Ghirnatah 1,850 2,100 King Abdullah 2,500 3,200 Al Munsiyah 2,600 3,500 Salah Ad Din 2,700 3,500 Al Hamra 2,000 2,500 Al Izdihar 3,600 Al Yarmuk 1,000 1,800 Al Nuzhah 3,600 Al Qadisiyah 1,200 1,300 Al Muruj 3,200 3,600 Al Sulimaniyah 3,400 Southern Riyadh Al Wurud 2,700 3,400 Name district Al Olaya 3,700 Manfuhah 1,100 1,300 Jarir 2,200 2,500 Ash Shifa 1,200 1,500 Al Dhubbat 2,400 2,800 Al Marwah 1,000 1,250 Utaiqah 1,100 1,300 Al Hada 2,400 2,700 Al Badi'ah 1,400 1,700 14

16 1/2/3 Commercial land in Riyadh: Commercial (Retail) land located on main roads in Riyadh were sold between SAR 2,000 SAR 2. Table 7 (In SAR) Road lowest rate highest rate Average Eastern Ring Road Western Ring Road Northern Ring Road Anas bin Malik Street Khair Road Kharj Road King Fahd Road King Abdul Aziz Road 6,500 5,500 9,000 7,000 4,000 2,000 17,000 7,000 9,000 6,000 12,000 8,000 5, ,500 7,750 5,750 10,500 7,500 4,500 2,500 20,000 7,750 Source: Field survey by CHESTERTONS Chart 7 the lowest rate the highest rate Average 25,000 20,000 17, ,000 15,000 10,000 5,000 6,500 9,000 7,750 5,500 6,000 5,750 9,000 12,000 10,500 7,000 8,000 7,500 4,000 5,000 4,500 2,000 2,500 7,000 8,500 7,750 Eastern Ring Road Western Ring Road Northern Ring Road Anas bin Khair Street Kharj Road Malik Road King Fahd Road King Abdulaziz Road 15

17 1/3 Riyadh Office sector: 1/3/1 Current supply of administrative offices in Riyadh: The second quarter 2016 witnessed the development of a few administrative offices projects to be delivered within the next two years. It is worth mentioning that rental rates have seen a slight rise, Offices rents range between 400 SR/m 2 up to 1,280 SR/m 2 and sometimes up to about 1,700 SR/m 2 in some distinctive towers in Riyadh. Table 8 Offices rental prices across Riyadh (in SAR/Sqm) Main Roads to King Fahd North 800 1,200 King Fahd Centre 900 1,250 Northern Ring Road 950 1,250 Eastern Ring Road Khurais Olaiya North Olaiya centre King Abdullah Centre west King Abdullah East Prince Mohammed Bin Abdulaziz Tahlia 950 1,100 Takhasusi Al Oruba Salahuddin Malaz Othman Bin Affan Source: Field survey by CHESTERTONS 16

18 1/3/3 Future supply of administrative offices in Riyadh ( ): It is expected that in 2016 the main completions will be the Information Technology & Communication Complex (ITCC) as well as Majdoul tower located on King Fahd Road will lead the market. The King Abdullah Financial District project expects further delays and is unlikely to provide any office space during the year The next table shows our projections for the total gross leasing offices areas within the next 3 years in Riyadh: Table 9 Project Name Offices tal Rental Area (GLA in 000 Sqm) Expected to start in King Abdullah Financial District (KAFD) ITCC King Saud University Endowment Project (KSUE) Majdoul wer Hamad wer Others tal GLA (000 Sqm) 1311 Till the end of 2018 Source: Field survey & analysis by CHESTERTONS Chart 9 Offices Future supply in Riyadh ( ): King abdullah Financial District (KAFD) 95 Information Technology & Communication Complex (ITCC) King Saud University Endowment Project (KSUE) Majdoul wer Hamad wer Others 17

19 1 /4 Riyadh Retail (Commercial) sector & Shopping Centers: The rental for shops across the city ranges between 700 SR/Sqm and 1,200 SR/Sqm with average of 927 SR/Sqm, and it might exceed to 2,500 SR/Sqm for line shops in some premium malls. 1/4/1 Current supply rented spaces for shopping centers: tal Retail rented spaces in the second quarter of 2016 reached approximately 1.47 million square meters, with growth of 600 Sqm more than was available at the end of year Table 10 year 2013 Reached 2014 Reached 2015 Reached 2 nd quarter 2016 reached Area rented (in million square meters) Growth rate %8 %3 %4 Source: Field survey by CHESTERTONS Chart

20 1 /4/2 Future supply for the shopping centers in Riyadh ( ): It is expected new commercial centers will be established in Riyadh city such as Mall of Saudi, Deriyah Festival City Mall, The Avenues, and others, all of which represent an added rental area about 1,418,360 square meters, as shown in the following table : Table 11 Upcoming Retail Project Expected GLA (Sqm) Mall of Saudi ( Majid Al Futtaim ) 300,000 Deriyah Festival City Mall 250,000 The Avenues ( Al Shaya Group ) 200,000 Arabia Plaza 164,360 City Center Ishbiliah ( Majid Al Futtaim ) 100,000 Riyadh Park 92,000 KAFD 88,000 AlHamraa Mall 52,000 ITCC 50,000 Malaz Mall 49,000 Khaleej Mall 4 Boulevard Mall 30,000 tal Expected GLA 1,418,360 Source: Field survey & analysis by CHESTERTONS Chart 11 Future supply for the rental spaces within the upcoming shopping centers in ,000 88,000 50,000 49, , ,000 Mall of Saudi ( Majid Al Futtaim ) Deriyah Festival City Mall The Avenues ( Al Shaya Group ) Arabia Plaza 92, ,000 City Center Ishbiliah ( Majid Al Futtaim ) Riyadh Park KAFD 100, ,000 AlHamraa Mall ITCC Malaz Mall 164,360 Khaleej Mall Boulevard Mall 19

21 It is worth mentioning that there are two big projects were contracted and approved in North Riyadh, and it is expected to be finished by : The first project is "The Avenues" one of Mabanee (Alshaya Group) projects, with a total area of 391, 000 m² Northern Riyadh, at a cost of about 6.5 billion SAR, the project includes a shopping mall and two hotels with 500 rooms, and residential buildings include 1050 residential unit and a medical building contains 240 medical clinic. The second project is "Mall of Saudi" one of Majid Al Futtaim Group projects, at a cost of about 10.5 billion SAR, with a total area exceeding 866 thousand square meters include one of the largest indoor ski resorts in the world, the project is scheduled to include 300,000 Sqm for shops, restaurants, leisure facilities, luxury condominiums, offices, showrooms, luxury hotels and serviced apartments as well as other public facilities. 20

22 1 /5 Riyadh Hotel sector: 1 /5/1 Current supply of hotel rooms in Riyadh: There is stability in the supply of hotel rooms in Riyadh reached about (10,700) rooms during the second quarter of 2016, which showed a percentage increase in the number of rooms 2%, As shown in the following table: Table 12 Year 2013 reached 2014 reached 2015 reached Q reached Number of rooms 9,500 9,900 10,500 10,700 growth rate 4% 6% 2% Source: Field survey by CHESTERTONS Chart 12 10,800 10,700 10,600 10,500 10,400 10,200 10,000 9,900 9,800 9,600 9,500 9,400 9,200 9,000 8, First quarter

23 1/5/2 Future supply of hotel rooms in Riyadh: It is expected that the future supply of hotel rooms in Riyadh at the end of the third quarter of 2016 will increase by about 3,100 rooms, and the supply is expected to reach up to 17,400 room at the end of 2018, which shows a growth rate of % 83 more than 2013 (was 9,500 room). Table 13 year The second half of Number of rooms 13,100 15,900 17,400 The expected growth rate 21% 9% Source: Field survey by CHESTERTONS Chart 13 The Projected Future supply for hotel Rooms 20,000 18,000 16,000 14,000 15,900 17,400 12,000 13,100 10,000 8,000 6,000 4,000 2,

24 1/5/3 Hotels under construction in Riyadh: There are many 5 star Hotel projects in the pipeline and will be completed in upcoming years as follows: Table 14 No project name InterContinental (King Abdullah Financial District) Aloft Riyadh Fairmont Hotel (Hilton (KSU) Nobuo Riyadh Crown Plaza Hilton Riyadh Hotel (Residence Granada) Le Meridien Radisson Blu Wyndham Hotel (King Abdullah Financial District) Court Yard Hotel Al Olaya Hyatt Regency Hotel Source: Field survey by CHESTERTONS Chart 14 No. of keys Hotels under construction in Riyadh city Completion date Court yard Hotel Al Alia, 200 Wyndham Hotel (King Abdullah Financial District, 210 Hyatt Regency Hotel, 295 InterContinental (King Abdullah Financial District), 220 Aloft Riyadh, 225 Fairmont Hotel, 288 Radisson Blu, 252 Hilton (KSU)), 241 Le Meridien, 232 Hilton Riyadh Hotel (Residence Granada), 830 Crown Plaza, 362 Nobuo Riyadh,

25 1/6 Kingdom of Saudi Arabia s Vision 2030 (1452 H): The Council of Ministers Approved a new a comprehensive and ambition vision of Kingdom of Saudi Arabia based on three PILLARS which are as follows: 1. The heart of the Arab and Islamic world. 2. A global investment powerhouse. 3. A global hub connecting three continents, Asia, Europe and Africa These pillars will provide better opportunities for partnerships with the private sector. The Kingdom will improve the business environment, so that its economy grows and flourishes, driving healthier employment opportunities for citizens. 1/6/1 THEMES AROUND WHICH THE KSA VISION IS BUILT: 1. A Vibrant Society focuses on the importance of building a vibrant society in which members live in accordance with the Islamic principle of moderation, enjoy a good life supported by an empowering social and health care system commitments and goals this theme as follows : increase the capacity to welcome Umrah visitors from 8 million to 30 million every year. more than double the number of Saudi heritage sites registered with UNESCO. have three Saudi cities be recognized in the top ranked 100 cities in the world. increase household spending on cultural and entertainment activities inside the Kingdom from the current level of 2.9% to 6%. increase the ratio of individuals exercising at least once a week from 13% of population to 40%. raise the position from 26 to 10 in the Social Capital index. increase the average life expectancy from 74 years to 80 years 2. A Thriving Economy, that focuses on creating a thriving economy that provides opportunities for all by building an education system aligned with market needs and creating economic opportunities for the entrepreneur, the small enterprise as well as the large corporation, develop investment tools to unlock our promising economic sectors, diversify the Saudi economy, create job opportunities, improve the business environment to leverage the unique strategic location commitments and goals this theme as follows: lower the rate of unemployment from 11.6% to 7%. increase SME contribution to GDP from 20% to 35%. increase women s participation in the workforce from 22% to 30%. move from the current position as the 19th largest economy in the world into the top

26 increase the localization of oil and gas sectors from 40% to 75%. increase the Public Investment Fund s assets, from SAR 600 billion to over 7 trillion. rise from the current 25th position to the top 10 countries on the Global Competitiveness Index. increase foreign direct investment from 3.8% to the international level of 5.7% of GDP. increase the private sector s contribution from 40% to 65% of GDP. raise the global ranking in the Logistics Performance Index from 49to 25 and ensure the Kingdom is a regional leader. raise the share of non oil exports in non oil GDP from 16% to 50%. 3. An Ambitious Nation In order for the KSA to be an ambitious nation, the public sector and the government will lead changes to promote effectiveness, transparency, accountability and enabling high performance,commitments and goals this theme as follows: increase non oil government revenue from SR163 billion to SR1 Trillion. raise the ranking in the Government Effectiveness Index, from 80 to 20. raise the ranking on the E Government Survey Index from our current position of 36 to be among the top five nations. increase household savings from 6% to 10% of total household income. raise the non profit sector s contribution to GDP from less than 1% to 5%. rally one million volunteers per year (compared to 11,000 now). 1/6/2 HOW TO ACHIEVE THE VISION? Many transformative programs that have paved the way for the Vision have already been launched and will help achieve the goals, including: The Government Restructuring Program. The Strategic Directions Program. The Fiscal Balance Program. The Project Management Program. The Regulations Review Program. The Performance Measurement Program. ensure the realization of Saudi Arabia s Vision 2030, a set of executive programs that will have a significant impact on implementation are being prepared and will be launched in due course, including: The Saudi Aramco Strategic Transformation Program. The Public Investment Fund Restructuring Program. The Human Capital Program. The National Transformation Program. The Strategic Partnerships Program. The Privatization program. The Program for Strengthening Public Sector Governance. 25

27 1/7 White Land Fees: 1/7/1 The initiatives taken by Ministry of housing to assist the landowners in their Land development process: Collect all relevant development actors under one roof to facilitate the procedures. Opportunity to sell raw lands on the map. The Ministry of Housing initiated WAFI Program to simplify the development process, and the Ministry's efforts in co operation with the private sector to provide developers to help the landowners who are wishing to develop their land. 1/7/2 Evaluation mechanism for the white lands: Land is assessed in accordance with the site and services and other utilities and activities, the landowner has the right to object to the fees within 60 days from the date of registration, any false information given by the landowner is fraud. In case of impediments or obstacles the fees do not apply to the land, Heirloom land is subjected to fees. 1/7/3 How to specify developed land: When the final maps are issued from the official authorities then it s defined as developed land, any rental is not exempted from paying fees on such land. 1/7/4 How to calculate Taxes and Zakat together: No final deduction for that matter, and a competent Committee will be formed to look at this issue. 1/7/5 The Geographic scope boundaries that is targeted to apply fees in the first phase of white land system: The range includes undeveloped Plots areas in Riyadh, Jeddah and Dammam, including undeveloped Plot area designated for only residential use or commercial residential use; for plots that are 10 thousand square meters or more, within the geographical scope that is shown in the following maps 26

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31 1/7/6 Stages of white land fees according to the Executive Regulation: First stage: 10, 000 m² and above in undeveloped land. Second stage: 10, 000 m² and above in developed land for one owner in one scheme. Third stage: 5, 000 m² and above in developed land for one owner in one scheme. Fourth stage: 10, 000 m² and above in developed land for one owner in one city. Once announcing and starting any stage, the process cannot go to another stage unless completing 18 months at least, each stage will be announced immediately after the Minister's approval to begin. In the case of non application of certain stage on any of the cities, or not in a certain stage to Achieving a balance between supply and demand, the Minister may overcome this stage and move to the next. The Developers Service Center ITMAM is now activated, this center has to end all necessary licenses from a One Stop Shop, if there are any obstacles from the authorities and not by the owner, the owner has the right to file a complaint and provide proof of his right, in order not to be charged for any bills or fines or other. 30

32 1/1/7 The implementation mechanism: Landlord has six months for registration. The landowner who provides false information will be under penalty of law (by the relevant authorities). Bills will be issued on the landowners after 6 months of registration. The landowner have one year from the registration date (about 18 months) to complete and to register the final Drawings and layout of the land, in order not to be charged for that year, in case of the development is completed in two years, the landowner will be charged for the first year only and the fees will be canceled in the second year upon delivery. In the case of non payment in a specific period of time, the landowner will be considered violating the law and will be subject to the penalty of law. Landowner whose bill was issued, has the right to object at a maximum of 60 days, and is answered within 60 days from the date of the objection. That isn't answered within this period, it shall be considered rejected, and landowner must pay the fees. 1/1/8 The lands definition according to the Executive Regulation: Undeveloped land: Is a raw land, land that is either does not have a license or is under development. The final maps and the license must be adopted and issued from the municipality and/or other official authorities to be considered as a developed land. Unused land (Space land): Land that is not developed, or not developed for the purpose it was allocated for. White land: Land dedicated to either residential use or residential commercial use within the urban boundary. Developed land: Land where final maps and the license have been adopted by the competent authorities. 31

33 CHESTERTONS One of the oldest firms of Property Consultants in the world. Founded in London in Over 65 offices in 15 Countries on 5 Continents. At the forefront of expanding International Standards. Permanent regional presence in the Middle East and North Africa established in 2008 Operational office established in the Kingdom of Saudi Arabia. Servicing property requirements within Saudi Arabia, the Middle East Region and Internationally. BUSINESS LINES Research, Advisory and Consultancy. Property Management. Leasing and Tenant Representation. International Sales and Acquisitions. Capital Markets. Property Valuations. Plant and Machinery Valuations. RESEARCH, ADVISORY AND CONSULTANCY 1. Market Research Project Specific Targeted Markets 2. Feasibility Studies Highest and Best Use Analysis. Master Planning. Financial Analysis. Strategic Advice. Contact us : Ahmad Ababatain Mark Morris Jones Mostafa Sewellam Abdulkarem Bawazir Managing Director, KSA Director & Country Manager, KSA Market Studies & Research Manager., KSA Valuation Manager, KSA ahmad.ababatain@chestertonsmena.com mark.morrisjones@chestertonsmena.com mostafa.sewellam@chestertonsmena.com abdulkarem.bawazir@chestertonsmena.com Address: KSA, Riyadh, King Fahd Road (North), TAMKEEN wer 17th floor, offices A & B, P.O.Box 2573, Riyadh Saudi Arabia 32