Saudi property market likely to revive soon: Dar Al Arkan CEO

Saudi Arabia's property market is expected to return to growth in the coming months, supported by the government’s stimulus and regulatory reforms, Zawya reported, citing Kelvin Kwok, chief executive officer, Dar Al Arkan Real Estate Development Co.

“With the support of government initiatives and a bounce in the fundamental levels of economic activity driven by the improved oil prices and Saudi employment levels, we expect the market to return to growth,” he stated.

The government initiatives include the Real Estate Development Fund, Sakani, a program for allocating housing and Etmam, a tool to expedite regulatory pathway for development approval, are expected to boost the market.

According to Kwok, the company has now adopted a new strategy, moving away from its previous policy of selling assets.

“Since Q3 17, due to the changing market realities, our approach is fundamentally different - we are more active in the market, trading our land bank, transforming our portfolio through both sale and purchase, and liquidating land holdings in favor of building liquidity, so we are better poised to take advantage of future opportunities."

Despite the white land tax - introduced in 2017 as a levy on undeveloped land in major cities in a bid to spur development - the developer said it is under "no pressure" to sell land, as it has a strong balance sheet with SAR  5 billion in cash.

The white land tax has had a “very limited impact” on Dar Al Arkan’s operations since the majority of its land bank is outside the designated zones covered by the tax, Kwok added.