S&P sees strong long-term growth opportunities for Saudi REITs

S&P Global expects strong long-term growth opportunities for Saudi real estate investment trusts (REITs), backed by recent initiatives and sustained expansion opportunities in the Kingdom’s property market.

In its latest report, the agency said the long-term outlook for Saudi Arabia’s real estate sector remains solid, although REITs continue to face significant financing needs. REITs can secure permanent capital from both domestic and international investors, attract foreign investment, and diversify funding sources for property operators, while also offering investors steady income streams.

“We expect the Saudi real estate sector will be key in expanding corporate lending over 2026-2027, a trend that has already started to materialize. We forecast that funding requirements, particularly in the construction space, will remain elevated over the medium term,” S& P Global added.

Any decline in property prices is likely to be limited, as strong demand for residential properties in Riyadh — driven by migration and the city's financial significance — will likely cushion price pressures. S&P further expects the new foreign Ownership Law, which will take effect in January 2026, to boost demand and foreign direct investment.