NEOM, the futuristic mega-city in Saudi Arabia, secures a groundbreaking $21 billion public-private partnership agreement for the first phase of its residential communities, marking a significant step towards its vision and attracting investors while boosting local development and sustainability.
NEOM, the futuristic mega-city project in Saudi Arabia, has reached a significant milestone in its expansion plans with the finalization of contracts for the first phase of its residential communities’ development. This ambitious social infrastructure project aims to accommodate the growing workforce in the region, and the agreement is valued at over SAR 21 billion, making it one of the largest international public-private partnerships in terms of accommodation. The preferred bidders for this phase include prominent Saudi Arabian companies, Alfanar Global Development, Almutlaq Real Estate Investment Company (AREIC), Nesma Holding Co., and Tamasuk, along with two separate partners, Al Majal Al Arabi Group Company and the Saudi Arabian Trading and Construction Company (SATCO).
NEOM’s Chief Executive Officer, Nadhmi Al-Nasr, expressed his satisfaction with the selection of leading Saudi Arabian companies as partners for delivering and operating the temporary communities. Al-Nasr stated, “The newly formed partnerships mark an important milestone for the region and is a testament to the capabilities of our team and partners who rapidly achieved financial close on a record amount.”
The agreement signifies a crucial step in encouraging greater private sector involvement in NEOM’s infrastructure development. The second phase of the temporary residential project is expected to be open to the market in the near future, while NEOM is currently reviewing interest from potential investors with plans to shortlist pre-qualified participants.
NEOM aims to attract more investors to contribute to its vision and become active stewards of its commercial assets. The substantial investment of billions of riyals demonstrates the magnitude of the project for Saudi Arabia and will have a direct economic impact on the region. Furthermore, it will help foster local competency, promote sustainable construction solutions, and generate employment opportunities.
NEOM’s core developments, including THE LINE, Trojena, Oxagon, and Sindalah, are progressing, and infrastructure is gradually unfolding across the vast region. This recent public-private partnership is a crucial step towards realizing larger plans within the agreed timescales. The scope of the agreement encompasses various aspects, such as design, finance, construction, operations, and maintenance of the housing communities.
Representatives from the partnering companies expressed their enthusiasm for being part of NEOM’s groundbreaking infrastructure project. Sabah Al Mutlaq, Vice Chairman of Alfanar, stated, “We are elated to partner with NEOM on this multi-nodal infrastructure project and to contribute to NEOM’s vision of disrupting the conventional approach to urban living.” Mohammed Al Balwi, Chairman of Tamasuk, emphasized their commitment to delivering the infrastructure that will facilitate the rapid development of NEOM. Faisal Al Turki, President of Nesma Co., expressed his eagerness to work with the NEOM team to bring the project and the wider vision to fruition. Tariq al Mutlaq, Chairman of AREIC, expressed delight in witnessing the growth of NEOM and highlighted the alignment of NEOM’s initiatives with their mission for sustainable development.
Upon completion of the first phase of the project, the agreement will lead to the establishment of 10 additional communities across NEOM, providing accommodation for an estimated 95,000 occupants. The temporary modular units, built sustainably, will serve as accommodations during the construction period and can be repurposed afterward. These communities will offer not only essential services but also a wide range of lifestyle facilities, including sports fields, cricket ovals, tennis courts, volleyball courts, basketball courts, swimming pools, and entertainment venues.
