OFFICE SECTOR
INCREASED OPPORTUNITIES FOR TENANTS
Currently facing a shortage of Grade A office space, the city of Jeddah is expecting a number of large projects to come to fruition over the next two years. Cityscape magazine evaluates the issues and the outlook for 2011
later increased to over SR1 trillion. According to Jones Lang LaSalle, the implementation of the country’s largest ever budget ‘will provide significant support to the real estate sector, on both the supply and demand sides.’
R It is thought the package and leadership initiatives
provided by the government, will have a direct and indirect impact across real estate sectors. JLLS said it expects the package to ‘boost economic activity, create jobs, and boost demand for office space.’ Te northern part of Jeddah appears to be the area
attracting significant amounts of new office space with more than half of the 2009-2011 supply being built there. Tenants based in the city will undoubtedly be able to look forward to a greater choice and more flexible terms and conditions. Te CB Richard Ellis Market View of Saudi Arabia
Half 2 2010 states the Jeddah office market continues to be subjected to a ‘sizeable volume of new space deliveries,’ with a number of large projects due for completion in north-west Jeddah over the next two years. Mike Williams, senior director, CBRE Middle East
Research and Consultancy, says this will result in a more tenant favourable market with increased opportunities for tenants to upgrade to better quality space at more competitive rental rates. “While asking rents have remained relatively stable
in good quality buildings, older buildings in historically favoured locations are experiencing increased vacancy, driving down rents as the market moves in favour of tenants,” Mr Williams said. Quoted rents for local quality space varies between
SAR500 and SAR1,350/m²/pa depending on the location and age of the building. CBRE states the median rental rate for new quality
office space is running at SR975/m²/pa plus 10% service charge. “Although Jeddah’s quality office space supply is growing, the pace of growth is not
esidents of Saudi Arabia were given a recent boost by the government when it announced a stimulus package of SR580bn, which was
10 I CITYSCAPE I JUNE 2011
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64