Saudi Arabia eyes deals with foreign firms in housing push

Saudi Arabia is set to offer local and foreign property developers partnership deals as part of its plans to build 1.5 million homes over the next seven or eight years, the kingdom’s housing minister Majed al-Hogail said on Wednesday.

Speaking at a press conference on the kingdom’s economic plans, Al-Hogail said the ministry is preparing five or six types of partnerships with developers.

“The developer would be an investor, bearing risk and designing products in line with market demand,” Reuters quoted the minister as saying. He explained that the ministry will support projects by offering information and arranging financing.

The kingdom is looking to attract foreign developers in particular as they can build more diverse projects. Last month, the Saudi government authorized the ministry to seek assistance from Britain, France and China in building new projects.

A shortage of affordable housing is one of Saudi Arabia’s most pressing socioeconomic concerns. Despite the fact that billions of dollars had been allocated to projects in the country in recent years, bureaucracy and plunging oil prices have slowed the pace of construction considerably.

The government, therefore, is planning to boost private sector involvement in developing housing, while the ministry takes on more of a regulatory role.

“We want to catalyze the private sector, to be a partner with it -- we want them to play the prime role,” he added.