Riyadh real estate sector suffers low revenues in Q3: JLL

The real estate sector’s revenues in Riyadh were low in third quarter, though the government’s efforts to diversify the economy could have a positive impact on the sector in the medium-term, JLL real estate consultancy said in a recent report.

The residential sector remained stable in the period, but rental value of office space has been decreasing and is expected to drop even more as new units enter the market.

“JLL believes the market needs incentives to create price competitions,’’ analysts wrote in the report. “We expect to see that as the government starts to gradually implement its real estate plans.’’

The retail shops have been performing well so far this year, but are expected to come under pressure as new buildings are finished, the report added.

“The average retail rent price remained unchanged quarter-on-quarter,” according to the report. “In August, transactions increased 24 percent, but its value dropped 6 percent year-on-year, signaling weak consumer spending.”

Vacancy rate remained at 7 percent year-on-year.