NEOM Signs Investor Contracts for Residential Community Construction Phase
NEOM obtains preferred investor funding for a multibillion-riyal project.
Signs one of the largest global public-private partnerships for social infrastructure.
Upon completion, new neighborhoods should be able to house 95,000 more people.
NEOM, Kingdom of Saudi Arabia, In order to accommodate the expanding workforce in the area, NEOM has announced that it has signed contracts with investors for the first phase of the construction of its residential communities. One of the largest global public-private partnerships for accommodation, the agreement has a total value of about SAR 21 billion.
Leading Saudi Arabian businesses, Alfanar Global Development, Almutlaq Real Estate Investment Company (AREIC), Nesma Holding Company, and Tamasuk, through two different partners, Al Majal Al Arabi Group Company and the Saudi Arabian Trading and Construction Company (SATCO), are among the preferred bidders for the first phase of the residential communities.
"NEOM has selected some of the leading companies in Saudi Arabia as partners in delivering and operating temporary communities with world-class services and infrastructure," said Nadhmi Al-Nasr, chief executive officer of NEOM. The newly established alliances represent a significant turning point for the area and are proof of the skills of our team and partners, who quickly closed on a record sum.
The deal opens the door for increased private sector involvement in NEOM's infrastructure development. In the upcoming months, the market is anticipated to receive the second phase of the project for temporary housing. Along with contract awards, NEOM is evaluating investor interest with the intention of shortlisting pre-qualified participants as soon as possible.
To bring in more investors who will share the vision and take an active role in managing NEOM's commercial assets is one of the gigaproject's strategic goals. The several billion riyal investment is more evidence of the project's size for Saudi Arabia. Additionally, it will have a direct economic impact on the area, promoting the use of sustainable construction practices and enabling the development of new jobs locally.
As infrastructure spreads over the huge territory, some of NEOM's key ventures, including THE LINE, Trojena, Oxagon, and Sindalah, are ramping up. This most recent public-private partnership is an essential step in completing larger programs by the set deadlines. The design, financing, construction, operations, and maintenance of the housing communities are all included in the scope of this agreement.
"We are thrilled to partner with NEOM on this multi-nodal infrastructure project and to contribute to NEOM's vision of disrupting the traditional approach to urban living," said Sabah Al Mutlaq, Vice Chairman of Alfanar. This is consistent with our pledge to provide superior solutions in a sustainable manner.
Tamasuk Chairman Mohammed Al Balwi stated, "We are incredibly happy to be NEOM's infrastructure partners. We are dedicated to supplying the infrastructure necessary to enable the rapid and extensive expansion of NEOM, along with Almajal and SATCO.
Nesma Co. President Faisal Al Turki stated, "At Nesma, we have created our reputation by taking on and completing difficult, crucial, and significant projects. For the purpose of achieving both the goals of this project and the broader NEOM vision, we look forward to collaborating with the teams at all levels.
"We are delighted to witness the growth of the compelling region of NEOM," said Tariq al Mutlaq, chairman of AREIC. Their actions supporting Vision 2030 are progressing quickly, which is in accordance with our aim to promote the Kingdom's sustainable growth.
Once the first phase of the project is finished, the deal will see the establishment of a further 10 communities throughout NEOM, adding space for 95,000 more people. The relocatable modular units used to build the temporary homes for the NEOM development period can be reused after the communities are no longer required. Communities will also have a variety of lifestyle amenities in addition to basic utilities, including multi-use sports fields, cricket ovals, tennis courts, basketball courts, volleyball courts, swimming pools, and entertainment venues.