Medina off-plan apartment sales to begin next year

• Fairmont branded residences to go on sale
• Launching in late 2026
• Aims to draw investment to Medina

The largest real estate project in the Saudi holy cities will begin off-plan apartment sales in Medina next year as it pursues partnerships with third-party developers for future phases, a senior executive has said.

The move signals a wider effort to attract real estate investment, including foreign capital, in Medina and Saudi Arabia more widely ahead of new regulations that will lower market barriers to overseas investors.

Developer Rua al Madinah Holding will start selling Fairmont branded residences ahead of the launch of its first phase towards the end of 2026, according to its chief commercial officer Pedro Ribeiro.

It also hopes to secure institutional investments and sign joint ventures with other developers, he said. Talks are already underway for such agreements, Ribeiro said, without giving further details.

“We are in touch with people that are listening to the project and are really considering investing,” he said. “They want to come and start doing business with us.”

Real estate project part of overall tourism plan

The project is the largest in the city’s history, spanning 1.35 million square metres. In addition to private residences, plans include 47,000 hotel rooms to help support Saudi Arabia’s ambition of increasing visitor numbers to Medina from 18 million to 30 million visitors a year.

Ribeiro said that 60 percent of the infrastructure for the project is now complete and the first hotel rooms may open by 2028. 

The overall project could be under construction until 2042, Ribeiro said. The project is backed by the kingdom’s sovereign wealth fund, the $930 billion Public Investment Fund.

Like other PIF projects, Ribeiro said that the company hoped that private investors and third-party developers would play a significant role in the construction of future phases. 

“We are opening the opportunity to outside investors from Saudi, the Middle East and, potentially in the very near future, foreign investments in Medina,” he said.

New regulations for foreigners

From January 22, Saudi Arabia will lower restrictions on foreigners buying real estate in the kingdom, although only Muslims will be permitted to buy in Mecca and Medina. Surveys suggest considerable interest among non-Saudi buyers in the holy cities.

The confirmed details surrounding the new foreign buyer legislation have not yet been released although Ribeiro said the company expects to see provisions for 100 percent foreign ownership across the city within the next two years.

The new measures allowing foreigners to buy in Saudi Arabia are intended to boost foreign direct investment and bolster the country’s growing real estate sector. The country hopes to more than quadruple FDI by 2030 to $100 billion of inflows.

Speaking in Riyadh last month, investment minister Khalid al Falih said that securing private investment had become a bigger concern, hinting that the government and PIF may look to pull back on big spending projects. 

Part of this may include an increase in initial public offerings, something that Crown Prince Mohammed bin Salman has said is an objective of all PIF companies.

Public listing

In March Umm Al Qura for Development and Construction went public in the second-largest IPO of the year, raising more than half a billion dollars.

While it is not a PIF company, Umm Al Qura is overseeing the construction of Masar, a mixed-use development in the holy city of Mecca of similar size and ambition to Rua al Madinah. 

Its share price has risen about 50 percent since listing.

Ribeiro declined to comment in detail on Rua al Madinah’s plans to go public saying only that the company is “ready for an IPO” but that “we are not putting it as a priority”.

Further reading:

• Saudi builders pivot to global market as reform looms
• Liveability is the Gulf’s smartest investment 
• Turkish developers target Saudi real estate market