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February week 3

Al Mazaya Weekly Real Estate Report underlines necessity of growing Smart City investments

-Will Smart Cities re-shape the real estate demand & supply landscape in Gulf Region?

The establishment of residential and commercial complexes with sophisticated infrastructure and integrated service projects now forms the basis for building top model smart cities.

Therefore, the real estate industry has started recently to witness a growing trend towards investments in smart cities, which have become a source of inspiration for many real estate developers to introduce products that ensure top quality standards and specifications conducive to earning the real estate sector the competitive edge required to ensure good and continuing demand levels.

In this regard, the Weekly Real Estate Report of Al Mazaya Holding indicates that smart city-related projects have become in strong demand across the Middle East region in a way that requires the introduction of more advanced real estate products, which will maintain good demand levels by relevant economic sectors.

With government and private real estate projects being on the rise, coupled with good levels of income at the individual level, the idea seems more mature to support and encourage the shift towards creating sustainable and technically capable communities to improve the quality education, health, and transportation services.

Smart City projects in Saudi Arabia take two parallel tracks; the first is to transform existing major cities into smart ones, particularly in Riyadh, Makkah, Al Madinah, Jeddah and Dammam, with a view to securing high sustainable urbanisation levels. The second is to construct new cities that integrate infrastructure projects, smart public utilities and self-sufficient and high-quality living standards, with the ultimate goal of stimulating urban activities and creating a fresh type of demand for real estate products at the local and external levels, by targeting investors and end-users from all over the world.

Smart city projects in the Kingdom place the country at the forefront of targeted economies by companies specialising in the implementation and development of such types of smart developments around the world. This will ensure a qualitative leap for the Kingdom's existing and new cities and increase their competitiveness locally and globally.

Al Mazaya report added that the idea of implementing smart city projects in the UAE has become the basis for all sectors, both public and private, to make great strides in this sector, and secure advanced positions on the list of cities that are more advanced digitally.

Dubai, in particular has expanded the concepts of digital applications in the fields of transportation, solar power generation and the provision of Internet services in line with the government’s initiative launched in 2014, to transform the way of life by 2020.

Herein it can be said safely that the main cities in the UAE are leading the industry at the regional level, making daily achievements at the financial and economic levels, including the current modern infrastructure, advanced communications, power and water control systems, thereby generating significant economic growth as a result of the increasing FDI inflows.

Al Mazaya stressed that Smart City projects have been launched and will continue delivering more projects.

These projects, said the report, will continue to provide unlimited investment opportunities and continuing businesses, by creating sustainable commercial and service activities with considerable economic returns. Industry data indicate that the size of the international smart cities market around the world will reach $880 billion by the year 2020. The launch of such state-of-the-art developments includes smart solutions to challenges encountered in the big cities to ensure continuity and competition, in addition to the implementation of new cities that introduce the highest level of technology, being the main factor in attracting end-users to these cities.

Current industry indicators show that the smart cities market will see greater growth over the next few years, which means unlimited investment opportunities for all companies operating in this field.