According to the latest construction market intelligence report released by global consultancy JLL, the Middle East and North Africa (MENA) region witnessed the awarding of projects worth $101 billion in the first half (H1) of 2023.
Saudi Arabia and the UAE accounted for a significant portion of the total project awards in the MENA region, with Saudi Arabia contributing $44 billion (around 67 percent of the total) and the UAE adding $23 billion to the figure.
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Despite a decline in the value of awarded projects year-on-year (YoY), Egypt maintains a strong pipeline of upcoming projects, indicating a positive outlook for future construction activities in the country.
The residential sector emerged as the dominant force in the UAE, with awarded projects amounting to over $9 billion. Notably, Dubai alone contributed to nearly 75 percent of the total value in this sector.
Furthermore, Saudi Arabia and Egypt granted project awards valued at $5 billion and $771 million, respectively, within the residential sector.
The hospitality and mixed-use sectors also demonstrated prominence, with Saudi Arabia’s leisure projects alone contributing $2 billion to these segments.
$3 trillion
The project pipeline in the MENA region surpassed an estimated value of $3 trillion, with Egypt, Saudi Arabia, and the UAE collectively accounting for over 60 percent of this total.
The Kingdom took the lead, capturing approximately 35 percent of the share, which translates to an anticipated value of $1.3 trillion. The UAE and Egypt each have an estimated value of $500 billion.
The construction sector, fueled by a remarkable project pipeline exceeding $3 trillion, is set to offer more than just stability in the upcoming period. Nations such as the UAE, Saudi Arabia, and Egypt predominantly lead this promising landscape.
Ongoing economic diversification
Meanwhile, the construction market in Saudi Arabia is projected to experience an average annual growth rate of 4 percent between 2024 and 2027. This growth is primarily attributed to the ongoing economic diversification efforts established under the Saudi Vision 2030 initiative.
Robust growth
The construction market in the UAE is anticipated to witness a robust average annual growth rate of over 3 percent between 2024 and 2027. This growth can be attributed to increased investments in various sectors such as infrastructure and real estate, including residential, hospitality, mixed-use, and commercial real estate.
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