Divided into 13 sections, the Plan covers the following areas:
1. Urban territory and settlement patterns 2. Local economy 3. Environment 4. Social Services 5. Culture and heritage 6. Tourism 7. Transportation 8. Infrastructure 9. Waterfront management 10. Open space and leisure 11. Housing 12. Unplanned settlements 13. Management
and quantity of land developed is often poorly matched to Jeddah’s needs, authorities said. As a result, there is an undersupply of land allocated to low and middle-income housing and an oversupply in other asset classes, particularly luxury housing and retail. Another issue with regards to the use of land the Jeddah Municipality is
addressing is the overallocation of land. “Te planning system in Jeddah has consistently set growth boundaries for the city which make too much land available to development. Te result has been fragmented development of a large area rather than the coherent development of smaller zones,” the Municipality said. Causes for this lie in the insufficient attention to conservation of land, weak planning controls and former land grants issued to Saudi citizens by the government.
Housing Initiatives In order to address the housing shortage in the Kingdom, the Jeddah Plan
outlines the following initiatives: l Produce 283,000 housing units to meet immediate deficiency, including 80,000 affordable and 151,600 replacement housing units for the currently inadequately housed population
l Provide an additional 670,000 units by 2029 to accommodate population growth
Rapid growth has created many challenges From a real estate perspective, the Plan is a huge challenge for the
responsible authorities. According to the Jeddah Municipality, “Jeddah is forecast to grow to 5.7 million people by 2029. Tis substantial increase in population will place additional pressures on the city. To accommodate this growth, nearly one million new housing units, including 685,000 affordable housing units will need to be built in Jeddah.” Jeddah’s housing shortage is evidence of a Kingdom-wide problem,
however here it is much more acute than in other regions, authorities say. Reasons for this lie in the increase in expatriate population, rural to urban migration as well as natural demographic growth with an increasingly young population. Te severe housing shortage itself is a result of the opposing interests of the public and the private sectors, the authorities feel. “Te current lack of supply is partly due to a lack of government control over private sector real estate developers, but also due to the developers themselves, who cater primarily for the more affluent classes and do not perceive middle and low cost housing projects as being sufficiently profitable.” According to Dr. Abdulgader Othman Amir, Vice Mayor for Strategic Planning & Chief Planner at the Jeddah Development and Urban Regeneration Company (JDURC), the biggest challenge the Plan faces with regards to the provision of affordable housing is the availability of land and the financing of construction in the absence of a mortgage law. Te Jeddah Plan identifies another obstacle to the development of
affordable housing in the country’s legal framework which provides insufficient protection to landlords and lenders whose tenants or borrowers default. “Tis is a disincentive in the creation of a robust rental market. Te development of new financing instruments, including the introduction of mortgages, should improve the fluidity of the housing market,” Jeddah Municipality said. According to the Municipality, “new financing and development mechanisms will be introduced to incentivise the development of housing for low-income and middle income residents.” In addition to the development of housing, the Municipality “will also
regulate the property market by establishing stronger processes for the allocation, release and control of land development.” According to the authorities, a significant amount of land in the city has been used in an unregulated or under-regulated way which resulted in the construction of low quality housing and poorly planned districts. In addition to this, the mix
l Provide mechanisms to cater for various types of tenure and relevant financing mechanisms
To realise and implement the initiatives, the Plan states that a number of institutions need to be created, new policies need to be put in place and old ones amended where necessary. Institutions include a Municipal Housing Authority and a Jeddah High Committee for housing while policies include the revision of the land grant policy and the amendment of eligibility criteria for housing support. Six months ago, JDURC began the construction of the North Jeddah housing project, east of Khaleej Salman, launched as an initiative to provide 25,000 residential apartments to the lower and middle income groups. Construction is scheduled to be completed within two years.
From a transit city to a destination in its own right In addition to residential real estate development, Jeddah is also currently undertaking several projects in the tourism and hospitality sector to accommodate the increase in tourists to the region as well as to strengthen the city’s image as an international tourist destination. “Te main challenge facing the development of our tourism sector is to
build Jeddah as a destination in its own right. Given the strong global and regional competition in tourism, the deficiencies must be addressed in what is offered to tourists and other visitors to the city. Currently there is a lack of well-maintained and well-marketed attractions, as well as inadequate transport and hospitality infrastructure, all of which require investment,” Jeddah Municipality said. According to the authorities, Jeddah is an important tourism hub for the Saudi Arabian economy, brining in more than a quarter of the country’s tourism earnings. Over 90 per cent of Jeddah’s tourism is from the domestic market while 44 per cent of the international tourists visiting Saudi Arabia are from GCC nations, and a further 49 per cent are from other Islamic nations. Only 7 per cent are classified as visiting from non-Islamic parts of the world such as North and South America and Europe. (Jeddah Municipality) Most international tourists primarily visit Saudi Arabia for religious
reasons. However, up until now, Jeddah had little benefit from religious tourism as pilgrims often transfer directly to Makkah or Madinah. With most religious tourists using Jeddah as a quick stopover on the way to Makkah and Madinah, authorities aim to “transform the city from being a gateway and transit destination to becoming a world-class nature, heritage and cultural tourism destination.”
JUNE 2012 I CITYSCAPE I 23
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