Saudi Arabia’s economic surge is redefining investment landscapes in the commercial real estate and tourism sectors, driven by increased global interest and strategic government initiatives. In early 2025, office rents and hotel revenues in the Kingdom reached historic highs, highlighting the country’s expanding economic momentum.
Office rents in Riyadh surged 23% year-on-year, reaching SAR 2,700 per square metre, the highest level ever recorded. Occupancy rates remain extremely tight, with 98% of premium office spaces fully leased.
This surge reflects the success of government-backed programs like the Regional Headquarters Programme. The scheme offers attractive tax incentives, including zero percent corporate income and withholding taxes for 30 years, to foreign firms establishing regional offices in Saudi Arabia.
More than 600 global companies have already announced plans to establish regional headquarters in Riyadh. Additionally, foreign business licenses increased by 67% in 2024, reaching a record 14,303. Meanwhile, Jeddah is quickly becoming a major business hub, with office occupancy at 95%. Large projects like Jeddah Gate and Jeddah Rose will add significant new office space in the coming years.
Tourism is also thriving amid Saudi Arabia’s record economic expansion. In 2024, the Kingdom welcomed a record 30 million international visitors. It aims to attract 70 million by 2030, in line with its Vision 2030 goals.
Makkah’s hotel revenue per available room rose 35.7%, while average daily rates jumped nearly 29% to SAR 859. This increase corresponds with an 8.3% rise in Umrah visas over the past year.
Madinah experienced strong growth. Its average daily rates climbed 11.8% to SAR 891, the highest nationwide. Revenue per available room increased 15.1%. The city is preparing for 30 million pilgrims annually by 2030, supported by over 6,000 new hotel rooms from major global brands.
The digital economy is another area reflecting Saudi Arabia’s record growth. The country targets expanding its data centre market to US$3.2 billion by 2029, up from US$1.78 billion in 2023.
Leading US cloud providers such as AWS, Microsoft, Oracle, and Google Cloud are ramping up operations. AWS alone has committed US$5.3 billion. Meanwhile, Chinese firms like Alibaba and Huawei Cloud are increasing their presence.
Saudi Arabia plans to quadruple IT capacity to over 1,000 megawatts by 2030. This growth positions the Kingdom as one of the world’s fastest-growing digital economies. Experts recognize Saudi Arabia as a top five global AI power, boosted by the recent US$100 billion Transcendence AI initiative.
Overall, Saudi Arabia’s booming growth touches real estate, the hospitality industry, and technology.. This trend underlines the Kingdom’s rapid rise as a global economic and digital hub.
