Saudi Arabia Construction Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 70.33 Billion |
| Market Size (2029) | USD 91.36 Billion |
| CAGR (2024 - 2029) | 5.37 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Need a report that reflects how COVID-19 has impacted this market and its growth?
Saudi Arabia Construction Market Analysis
The Saudi Arabia Construction Market size is estimated at USD 70.33 billion in 2024, and is expected to reach USD 91.36 billion by 2029, growing at a CAGR of 5.37% during the forecast period (2024-2029).
- The market is driven by Riyadh's Vision 2030 national development plan for diversifying and privatizing the huge Saudi economy. This plan includes several huge megaprojects like the Neom Future Cities, Qiddiya Entertainment City, and the Red Sea Project. Saudi Arabia offers the region's biggest pipeline of construction opportunities.
- Due to the COVID-19 pandemic, the Saudi Arabian construction market had to deal with many problems. The pandemic had a big effect on Saudi Arabia's construction industry. The rate at which construction contracts were given out dropped significantly in 2020 and 2021. However, the Kingdom had the highest value of projects awarded in 2022, which showed its commitment to diversifying the economy and changing the country in line with its Vision 2030,
- In 2022, the number of buildings built in the Kingdom grew by 3.2%. Saudi Arabia has been the strongest market in the MENA region for the past four years in a row, with the highest overall value of project awards. As of October 2022, Saudi Arabia had a 35% market share and won contracts worth USD 31 billion compared to USD 87 billion for all of MENA.
Saudi Arabia Construction Market Trends
Increase in the Total Value of Construction Contracts Awarded in Saudi Arabia
Saudi Arabia's pipeline value of unawarded (pre-execution) projects is estimated at USD 1.1 trillion, which includes projects from the study stage through the leading contractor bid. Approximately 70% comprise construction sector projects, with residential, cultural, leisure, and hospitality as sub-sector leaders. This is the driving force behind the Vision 2030 strategy. In the second half of 2022, 13,000 hotel keys were expected to be delivered in Riyadh, Jeddah, and Makkah, accentuating the continuation of the development of the Kingdom's hospitality sector.
The top ten contractors in the Kingdom are responsible for USD 400 billion in projects, which are currently in the execution stage, accounting for 40% of the total future pipeline value of USD 1.1 trillion. According to MEED Projects, the total value of projects awarded in Saudi Arabia between 2021 and 2025 is expected to reach USD 569 billion, with a total of USD 85 billion (15%) awarded to date across 2021 and 2022 (October end).
Global economic volatility in the first two quarters of 2022 created challenges in the local construction market regarding delivery lead times and instant price increases, with suppliers reluctant to guarantee prices for extended periods.
Emergence of Saudi Arabia as a Cultural and Religious Tourism Center is Likely to Promote the Construction Demand
The Kingdom's hotel construction rate is anticipated to nearly triple in 2023, with nearly 50% of the 167 projects on file due for delivery within those 12 months.
Altogether, 56% (35,884) of the 63,753 Saudi Arabian rooms in the database are expected to come online in 2023, dwarfing the 9,207 keys from the 24 projects in 2022. Development is anticipated to return to near this rate in 2024, with 23 projects delivering 9,599 rooms, while 2025 and beyond are likely to see at least another 40 hotels representing 9,063 keys joining the market.
First-class four-star properties account for 77 projects and 30,229 rooms - 46% of the total, with the remaining 54% in the five-star luxury segment, equating to 90 builds comprising 33,524 keys.
A significant proportion of the development wave is due to a number of megaprojects taking shape in Makkah (Mecca). While in terms of pure project totals, the 27 hotels slated for the Islamic religious center only put it third on the top Saudi cities list, the 31,957 keys which are expected to become available in the area are more than three times that of the number one city by project number - which is Riyadh, with 45 hotels totaling 9,302 rooms.
Second in this analysis is Jeddah, with 33 projects delivering 7,148 rooms, while fourth in the list is Al Wajh, representing 12 projects of collectively 4,868 keys.
Saudi Arabia Construction Industry Overview
The Saudi Arabian construction market is fragmented and highly competitive, with the presence of major international players. The Saudi Arabian construction market presents opportunities for growth during the forecast period, which is expected to further drive the competition in the market. With a few players holding a significant market share, the Saudi Arabian construction market has an observable level of consolidation. Some of the key players include JGC Corp., SNC-Lavalin, Fluor Corp., Van Oord Dredging & Marine Contractors BV, and VINCI. The government's focus on the creation of general infrastructure as well as energy and utility construction projects as part of its effort to diversify its economy away from the oil industry is anticipated to help the construction industry's output.
Saudi Arabia Construction Market Leaders
Bechtel
CB&I LLC
Fluor Corp.
Tekfen Construction and Installation Co. Inc.
Gilbane Building Co.
*Disclaimer: Major Players sorted in no particular order
Saudi Arabia Construction Market News
January 2023: China Harbor announced in a statement that it awarded two contracts to Saudi Arabia. The first contract was related to building the infrastructure of a new project in Riyadh, and the main scope of work included various pipeline facilities, earthworks, and ancillary housing construction facilities. This project was the second pipeline network project won by the company in the central region of Saudi Arabia in Riyadh, and it was also another important achievement of the company's active "secondary operation" for core owners.
December 2022: Bechtel was appointed as the project management consultant for TROJENA, a year-round mountain destination in the NEOM region of northwest Saudi Arabia. TROJENA is a key development that will contribute to the Kingdom's Vision 2030 goals of growing tourism and diversifying its economy away from hydrocarbons. In this role, Bechtel is expected to provide various services, including technical, commercial, and construction management, for the development of TROJENA and support NEOM's ambitions for sustainability.
Saudi Arabia Construction Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
2.1 Analysis Methodology
2.2 Research Phases
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Current Economic and Construction Market Scenario
4.2 Technological Innovations in the Construction Sector
4.3 Spotlight on Key Ongoing and Upcoming Projects
4.4 Industry Value Chain/Supply Chain Analysis
4.5 Impact of Government Regulations and Initiatives on the Industry
4.6 Impact of COVID-19 on the Market
5. MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Saudi Arabia Vision 2030
5.1.2 Green and Sustainable Building Initiatives
5.2 Market Restraints
5.2.1 Saudization (Nitaqat) Program
5.2.2 Declining Crude Oil Prices
5.3 Market Opportunities
5.3.1 Increased Foreign Investment
5.3.2 Business Tourism
5.4 Industry Attractiveness - Porter's Five Forces Analysis
5.4.1 Bargaining Power of Suppliers
5.4.2 Bargaining Power of Consumers/Buyers
5.4.3 Threat of New Entrants
5.4.4 Threat of Substitute Products
5.4.5 Intensity of Competitive Rivalry
6. MARKET SEGMENTATION
6.1 By Sector
6.1.1 Residential
6.1.2 Commercial
6.1.3 Industrial
6.1.4 Infrastructure (Transportation)
6.1.5 Energy and Utilities Construction
7. COMPETITIVE LANDSCAPE
7.1 Market Concentration Overview
7.2 Company Profiles
7.2.1 Bechtel
7.2.2 CB&I LLC
7.2.3 Fluor Corp.
7.2.4 Tekfen Construction and Installation Co. Inc.
7.2.5 Gilbane Building Co.
7.2.6 Jacobs
7.2.7 AL Jazirah Engineers & Consultants
7.2.8 Al Latifa Trading and Contracting
7.2.9 Afras Trading and Contracting Company
7.2.10 Al-Rashid Trading & Contracting Company*
- *List Not Exhaustive
8. FUTURE OF THE MARKET
9. APPENDIX
9.1 Macroeconomic Indicators (GDP Breakdown by Sector, Contribution of Construction to Economy, etc.)
9.2 Key Production, Consumption, Export, and Import Statistics of Construction Materials
Saudi Arabia Construction Industry Segmentation
The construction market includes a wide range of activity that covers upcoming, ongoing, and growing construction projects in different sectors. These include but are not limited to geotechnical (underground structures) and superstructures in residential, commercial, and industrial structures, as well as infrastructure construction (like roads, railways, and airports) and power generation and transmission-related infrastructure.
The Saudi Arabian construction market is segmented into residential, commercial, industrial, infrastructure (transportation), and energy and utility construction. The report provides market size and forecasts for the Saudi Arabian construction industry in terms of value (USD) for all the above-mentioned segments.
| By Sector | |
| Residential | |
| Commercial | |
| Industrial | |
| Infrastructure (Transportation) | |
| Energy and Utilities Construction |
Saudi Arabia Construction Market Research FAQs
How big is the Saudi Arabia Construction Market?
The Saudi Arabia Construction Market size is expected to reach USD 70.33 billion in 2024 and grow at a CAGR of 5.37% to reach USD 91.36 billion by 2029.
What is the current Saudi Arabia Construction Market size?
In 2024, the Saudi Arabia Construction Market size is expected to reach USD 70.33 billion.
Who are the key players in Saudi Arabia Construction Market?
Bechtel, CB&I LLC, Fluor Corp., Tekfen Construction and Installation Co. Inc. and Gilbane Building Co. are the major companies operating in the Saudi Arabia Construction Market.
What years does this Saudi Arabia Construction Market cover, and what was the market size in 2023?
In 2023, the Saudi Arabia Construction Market size was estimated at USD 66.75 billion. The report covers the Saudi Arabia Construction Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Saudi Arabia Construction Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Saudi Arabia Construction Industry Report
Statistics for the 2024 Saudi Arabia Construction market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Saudi Arabia Construction analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
