MAKKAH, 11 January 2008 — The volume of the real estate market around the Haram Mosque in Makkah is projected to cross SR1.5 trillion mark this year, registering a 50 percent surge compared to last year, according to a real estate developer in Makkah.
Bandar Al-Homaidah, member of the Real Estate Committee in the Makkah Chamber of Commerce and Industry (MCCI), said the new developmental projects and construction of infrastructure including circular roads in Makkah would reduce the residential facilities in general.
Homaidah warned an impending real estate crisis because of various factors including the evacuation and demolition of around 1,000 properties comprising 4,000 residential units for the new expansion scheme of the Haram Mosque courtyard.
Fearing a crunch in the supply of residential facilities, the businessmen in Makkah recently appealed the Ministry of Municipal and Rural affairs to review the currently approved urban belt, which is valid until 2028. Custodian of the Two Holy Mosque King Abdullah ordered a fair appraisal of the properties to be acquired for the expansion of the Haram courtyard in the northern side and that the compensation should be commensurate with the prevailing market rates, according to informed sources.
Abdullah Ibrahim Al-Saggat, chairman of the property assessment committee in the Makkah region, said the work on the northern expansion of the Haram Square, which will be ready for worshippers in five years, would start the after the completion of the assessment of the value of the properties and the transfer of the ownership.
“The properties to be demolished are within 400 meters in the Al-Ezzah Street toward the Jabal Kaaba in the north western direction of the Haram Mosque,” he said.
He added that an appraisal committee headed by the mayor of Makkah has begun the study of the properties. The price of the properties would be fixed with due consideration for the location and category of the building.
Essam Basnawi, deputy chairman of MCCI, said the available plots would not be able to accommodate 75 percent of the displaced. “A chamber committee plans to form a real estate bloc that can head off a real estate crisis in Makkah after the demolition of 1,000 properties. Makkah is in need of more residential buildings to satisfy the increasing demand. Those who build new properties will serve as the substitute for the properties demolished for the expansion project,” Basnawi said.
He urged the builders to emulate the Egyptian experiment in which the suburban builders helped find residences for those who were displaced by various developmental works in the heart of the city.
Bandar Al-Homaidah, member of the real estate committee in the chamber, said the expansion of the Haram Square to the northern side would accommodate a large number of worshippers in the courtyard.
“While the new expansion would accommodate several thousands of pilgrims, it will also raise the rent demand by 20 percent compared to last year,” he added.