Saudi Arabia Office Real Estate Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Saudi Arabia Office Real Estate Market Trends and Insights

Rising Demand from Multinational Corporations under Vision 2030

The Regional Headquarters program grants 30-year zero-tax status, so more than 350 global firms secured RHQ licenses by early 2024. Each license obliges at least 15 senior employees and decisions over two MENA markets, ensuring sticky head-count growth. Technology giants such as Amazon and Microsoft joined early, reinforcing investor confidence. As capacity in Grade A towers tightens, late entrants explore secondary corridors or accept longer leases in emerging districts. This corporate influx is sustaining the Saudi Arabia office real estate market even as hybrid work gains ground elsewhere^{[1]Aisha Al-Mahdi, “Vision 2030 Progress & Diversification Metrics 2025,” Vision 2030 Secretariat, vision2030.gov.sa}.

Government-Led Mega Projects in Riyadh and Jeddah Creating New Office Hubs

Projects like the USD 50 billion New Murabba in Riyadh and the USD 12.5 billion Jeddah Central scheme are adding entire business districts and are timed to align with Expo 2030 and the 2034 FIFA World Cup. Diriyah Gate and NEOM’s Oxagon deepen geographic diversification and sector clustering. These developments fragment traditional demand, forcing occupiers to match location with talent pools and transport links. The pipeline enlarges total inventory yet also creates experiential hubs that defend premium asking rents. Successful phasing will depend on infrastructure readiness and tenant pre-commitments^{[2]Faisal Al-Ibrahim, “New Murabba Masterplan Overview,” International Trade Administration (ITA), trade.gov}.

Strong Growth in Financial, Technology, and Professional Services

Saudi credit rose 16.26% year on year to USD 827.2 billion in March 2025, with real-estate lending up 40.5%. Fintechs thrive under sandbox regulations, boosting demand for smaller, tech-ready floorplates. EY opened an 11,691-square-meter MENA HQ in KAFD, joining other professional advisers as Vision 2030 accelerates transformation projects. PwC’s temporary advisory ban has freed shares for rivals and local specialists, stimulating further leasing. Landlords now upgrade connectivity, collaboration areas, and ESG credentials to attract these high-growth tenants.

Increased Preference for Grade A Space with Sustainability and Smart Features

KAFD’s 94 towers earned LEED Platinum, setting a benchmark for green credentials. Forbes International Tower is registered for Zero Carbon Certification, running on 100% clean energy split between hydrogen and solar. The Saudi Building Code 2024 enforces energy conservation, prompting retrofits and raising barriers for outdated stock. Corporate ESG targets push landlords to install IoT building management systems and renewable power. Consequently, rent spreads between Grade A and lower classes are widening, and secondary assets risk rapid obsolescence unless modernized^{[3]Sarah Al-Suhaimi, “King Abdullah Financial District Sustainability Report 2024,” KAFD DMC, kafd.sa}.

High Construction and Fit-Out Costs Impacting Project Viability

A USD 1.5 trillion national project pipeline strains labor and materials, lifting build costs above Gulf averages. Imported inputs expose developers to freight delays and currency shifts, while geopolitical frictions widen procurement buffers. Skilled-trade shortages enlarge wage bills and slow site progress. The 5% Real Estate Transaction Tax introduced in April 2025 adds financing friction. Although some commodity prices eased in 2024, the structural gap between supply and demand persists, squeezing speculative margins.

Oversupply Risk in Certain Office Districts Creating Rent Pressure

Simultaneous delivery of New Murabba, KAFD phases, and private towers could outpace organic absorption in Riyadh by late-decade. Government-backed stock may not always mirror market-driven demand, and slower-than-expected multinational expansion would accentuate vacancies. Tenant flight from older towers to smarter builds can leave secondary stock under-let, lowering average city rents. Developers with limited pre-leasing run higher default and refinancing risk in the event of a cyclical pause. Vigilant phasing and flexible floorplate design remain critical.

Segment Analysis

By Building Grade: Premium Properties Drive Leadership

Grade A offices controlled 47.9% of the Saudi Arabia office real estate market in 2024, and the cohort is projected to grow at an 8.31% CAGR through 2030. The King Abdullah Financial District shows how green credentials underpin this result, as LEED-certified assets achieve stronger leasing. Forbes International Tower adds technology stature by targeting Zero Carbon status. Developers retrofit Grade B stock to chase similar rents, while Grade C faces potential conversion to other uses. These trends elevate the Saudi Arabia office real estate market size captured by top-tier assets and deepen the bifurcation between grades.

Tenant expectations around IoT integration, renewable energy sourcing, and wellness amenities are reshaping design briefs. The Saudi Building Code 2024 embeds energy efficiency, accelerating demand for high-grade materials and smart systems. As global firms expand headcount under the RHQ regime, they favor modern towers offering reliable digital infrastructure and ESG compliance. This dynamic allows premium landlords to lock longer leases and to pass through higher operating costs. Lower-grade buildings risk rental discounts unless they fund major upgrades.

Note: Segment shares of all individual segments available upon report purchase

By Transaction Type: Rental Dominance Persists

Rentals represented 80.3% of the Saudi Arabia office real estate market size in 2024 and show an 8.55% CAGR outlook. International corporations choose leasing to maintain agility ahead of the January 2026 foreign-ownership reform. Government agencies also sign multi-year leases, anchoring cash flows for investors. Grade A rents in Jeddah climbed 15% to USD 320 per square meter in 2024, reflecting tight supply and rising fit-out standards. Sales remain a niche pursued by local investors and sovereign wealth arms.

Flexible lease clauses allow tenants to scale space as projects ramp up or wind down. Developers structure core-and-shell handovers to shorten fit-out intervals, which appeals to tech and consulting occupiers. The 5% transaction tax on disposals nudges businesses toward renting rather than buying. REIT structures provide indirect ownership exposure for institutions that favor stable dividend streams over operational control. These elements reinforce rental dominance across the Saudi Arabia office real estate market.

By End Use: Financial Services Lead, Consulting Accelerates

Banking, financial services, and insurance held 31.1% of the Saudi Arabia office real estate market share in 2024, driven by credit expansion and financial hub ambitions. Consulting and professional services, however, forecast the fastest 8.71% CAGR thanks to robust advisory demand. PwC’s advisory hiatus has opened market gaps that competitors and local players race to fill. Technology players also expand under national digitization mandates.

Financial institutions require proximity to regulators and prefer landmark Grade A towers that signal credibility. Professional advisers seek collaborative layouts and high-bandwidth connectivity to run hybrid workshops. Fintech startups look for smaller, flexible units within incubator clusters. Legal firms enlarge footprints to handle complex foreign investment filings tied to RHQ licensing. This diverse end-user mix supports absorption across multiple sub-segments of the Saudi Arabia office real estate market.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Riyadh controlled 51.1% of the Saudi Arabia office real estate market in 2024, reflecting political centrality, mega-project investment, and RHQ clustering. New Murabba, KAFD expansion, and the metro are broadening the CBD footprint. Premium vacancies are low and rents are rising, yet large supply waves scheduled from 2026 onward may test the equilibrium. The city’s airport and rail projects reinforce cross-border integration, sustaining long-term appeal.

Jeddah remains the maritime and commercial gateway. The USD 12.5 billion Jeddah Central project and the resumption of the Jeddah Tower inject confidence. Religious tourism growth and relaxed foreign-ownership rules can draw occupiers priced out of Riyadh. Rental gaps between Grade A and lower classes are narrowing as new waterfront offices set benchmarks. Developers eye mixed-use formats that blend hospitality with corporate suites.

The Dammam Metropolitan Area posts the fastest 9.09% CAGR as petrochemical, logistics, and public-sector agencies increase regional bases. Proximity to Saudi Aramco, industrial ports, and pipeline infrastructure secures steady leasing. Secondary cities such as Medina, Abha, and Tabuk emerge through Knowledge Economic City and AlWadi projects, offering cost-effective alternatives, albeit with thinner service ecosystems. These locations diversify the Saudi Arabia office real estate industry and reduce geographic concentration risk.