Diriyah claims $4bn home sales ahead of property law change

• Sales boosted by regional HQ programme
• 11% come from multinational companies
• Foreign-buyer law now in effect

Diriyah Gate is capitalising on the influx of companies to Saudi Arabia, with relocating professionals accounting for more than a tenth of home sales at the Riyadh giga-project.

“We’ve sold over $4 billion in residential real estate,” Diriyah Gate CEO Jerry Inzerillo said in an interview at Davos. “Our Ritz-Carlton residences, which sold all 140 units, will have people move in later this year.”

While some giga-projects are being scaled back in a shake-up of Saudi Arabia’s Vision 2030, Diriyah is benefiting from international companies setting up in and around the $63 billion development as part of Saudi Arabia’s regional headquarters programme.

Supplied/Diriyah

Inzerillo did not break down the nationalities of buyers during the interview on January 19, but said 11 percent of sales had come from multinational companies relocating.

“Now Gulf residents are buying in Riyadh because they’re [moving] regional headquarters,” he said.

“They’re buying houses for their CEO, their CFO, their teams that come in. So we feel very strongly that within the next two years, the amount of residential sales is going to be robust.”

Saudi Arabia’s new property law allowing foreigners to buy properties in designated zones came into effect on January 22. Diriyah began locking in contracts with overseas buyers ahead of the law change.

Last November Diriyah representatives at the Cityscape Global real estate conference explained that foreigners could sign up for a home on the spot, with paperwork to be completed once the new rules were in place. 

The country’s investment minister Khalid Al Falih said at a conference this week that relocating businesses were driving Saudi Arabia’s property sector: “Today 62,000 international investors are registered in the kingdom, with more than 700 being regional headquarters.

“They are bringing with them very sophisticated leaders who demand a significant amount of offices, homes and branded residences.”

For Diriyah, the hope is that half of the project’s cost will be paid through foreign investment. 

Job opportunities will draw in a working population who will require housing. 

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“Diriyah 2 [the next phase of the masterplan] is configured for 500 tech companies, 100 media companies and 50 entertainment companies. That will come, all the land acquisition is done, infrastructure is being put up now, that will come shortly after 2030,” said Inzerillo. 

In November Diriyah unveiled its first non-hotel-affiliated – and thus more affordable – homes. The 239 residences, which have gone on sale off-plan, are priced from SAR1.6 million ($430,000) for a studio. Townhouses will cost up to SAR8 million.