JEDDAH, 13 May 2004 — The rising Abraj Al-Farsi residential tower on the north Corniche has tapped a growing market in the Kingdom. The huge triple tower project, located 500 meters north of the Sheraton Hotel, came about from the clear desire of young professional families to own land and property, said Zaki Farsi, the developer of the project.
At 30 stories, it will be the tallest building on the Corniche and the tallest residential tower in Jeddah.
“Land prices have been driven up in the search for quick profit, and this has been described as the ‘real estate boom,’” said Farsi. “This is harming the future of real estate development, because it is not true development. Putting asphalt and lights, advertising in the paper, and auctioning off the land for a quick profit endangers true real estate development.”
The profit is made quickly and at a higher than normal growth. This pushes up land prices in general — well above the usual single-figure percentage rise per annum. “This has made land very expensive for people wanting to build a villa.”
As a result, the middle-range market has suffered with the purchaser sometimes needing to approach a lending institution to finance a modest dwelling.
Within Saudi culture, the idea of owning rather than renting has caught on. The municipality has accepted the idea to divide the 25-meter lots in half for smaller villas.
This reduction in space means smaller villas and different lifestyle options. “From my research,” said Farsi, “people can only build a villa on a 10-meter frontage for the price of a 20-meter frontage five years ago.”
“We’re sacrificing this lifestyle because of the few who have manipulated land prices in the last five years, causing it to double,” he said.
A survey of villas in Jeddah revealed that SR2 million will only buy you a villa with a space of about four meters from the next unit. “Given the importance of privacy in the Saudi way of life, most of the villas we surveyed had their windows closed,” said Farsi.
For a similar price, the tower project offers green space with playgrounds and facilities of 50 by 90 meters and the ability to be completely private yet within a community.
To attract the traditional Saudi family who value their privacy yet want to enjoy a family life, Farsi had to offer a lot more than just green space for the children.
The target client is probably going to be younger, professional and possibly have a working wife. Integrated into the complex is a four-story entertainment facility — male/female clubs with mirrored facilities — to address the changing culture.
The foundations have been built and the analysis of the developing market appears to have been accurate. All the units were sold before the tower construction reached ground level.
