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Saudi Arabia Report
Marcopolis presents the Saudi Arabia Report focused on the investments, doing business, economy and other topics featuring interviews with key executives. The sectors under review in this issue are industry, real-estate, ICT, investments, banking sector, telecom sector and many more.
InterviewsMarch 04, 2024
Elias Abou Samra Talks Riyadh’s Urban Evolution and RAFAL’s Vision to Transform the Cityscape
Elias Abou Samra, CEO of RAFAL Real Estate Development Co.
- Written by Sandra Francisco
- Published: March 04, 2024
Interview with Elias Abou Samra, CEO of RAFAL Real Estate Development Co.
There have been notable changes in the Saudi Arabian real estate sector since 2022, how has RAFAL adapted to them?
Over the past two years, the Saudi Arabian real estate sector has experienced significant transformations. On the housing front, the various initiatives and subsidies under the Ministry of Housing have led to an increase in home ownership from 47% to 60%, most of which was absorbed over the last two years. As for the urban development of the capital Riyadh, the emergence of mixed-use developments and the completion of Riyadh metro are driving the shift from a suburban villa lifestyle to a vibrant urban living. RAFAL has adapted to these changes by embracing transit-oriented developments. Additionally, there has been a concerted effort between regulators and developers to increase urban density as a solution to traffic congestion.
Several mega projects are set to offer 15-minute districts within the city. RAFAL recognizes the importance of these mega projects and has engaged in public-private partnerships to enhance the quality of its offering. Furthermore, there has been a societal shift towards an international lifestyle, prompting RAFAL to ensure that its developments meet international standards of quality.
What is RAFAL’s involvement in Riyadh’s urban development projects?
RAFAL is actively engaged in various aspects of Riyadh’s urban development initiatives. Firstly, we are pioneering the development of the first co-living brand in Saudi Arabia. With five projects in the pipeline, strategically located near urban transit hubs, office clusters, expatriate communities, and public institutions, our aim is to introduce a minimum of ten buildings over the next five years. This initiative seeks to transition individuals from suburban areas into the heart of the city, offering them the advantages of proximity to a live-work-play environment and reducing lengthy commutes.
Recently, RAFAL and HiveColiv, a leading co-living solutions provider based in Dubai, have embarked on an unprecedented collaboration to launch our first co-living project in Riyadh. This collaboration marks a significant milestone for both RAFAL and HiveColiv. It represents our shared commitment to innovation and redefining modern living spaces in Riyadh. The inauguration ceremony took place on February 23, 2024, right after the Saudi Founding Day, and it was a momentous occasion.
We believe that this co-living project will set a new standard for urban living in Riyadh. By fostering community, collaboration, and a high quality of life, we aim to redefine contemporary living standards and contribute to the city’s urban development.
Moving to a higher level of involvement, we are deeply involved in several mega projects, co-developing early phases in emerging districts within the city. While these projects are still in the final stages of construction and cannot be formally announced yet, they represent significant contributions to Riyadh’s urban expansion.
Furthermore, RAFAL has forged private-public partnerships to further enhance its role in urban development. A joint venture with CITIC Group, one of the largest Chinese conglomerates globally, ranked 102nd on the Global Fortune 500 list, demonstrates our commitment to collaborating with esteemed entities on transformative projects.
By operating at these three levels of engagement, RAFAL ensures agility in strategy implementation at the grassroots level, while also fostering collaboration with private entities as projects scale up.
How does RAFAL differentiate itself from its competitors?
Since its establishment 15 years ago, RAFAL has maintained a distinctive approach aimed at introducing innovative products to the market, not merely for the sake of differentiation, but to enhance urban living conditions. This commitment is evident in the projects RAFAL has undertaken over the past decade and a half. From pioneering high-rise, mixed-use developments to being the first to introduce gated communities for sale to Saudis, RAFAL has consistently broken barriers and set new standards in the industry. Today, many of these innovative techniques have become the norm, adopted by numerous mega projects. We firmly believe that our early efforts in introducing these products have paved the way for the larger-scale projects we see today. Looking ahead to the next decade, RAFAL remains dedicated to disrupting the market with similar groundbreaking products. One such example is our Co-Living brand, a response to the growing trend of cosmopolitan living. By offering convenience and affordability, Co-Living not only appeals to expatriates relocating to Riyadh but also to Saudis embracing the international lifestyle.
How has RAFAL positioned itself to cater to the increasing number of international firms and expats relocating to Saudi Arabia?
RAFAL has strategically positioned itself to meet the needs of the growing number of international firms and expatriates relocating to Saudi Arabia. Our existing portfolio of properties, such as Burj RAFAL, RAFAL Residence, and Ascott, is well-suited for expats moving to Riyadh. This is evident from the tenant profiles in these projects, with RAFAL Residence being the leading brand for serviced residences in Saudi Arabia. While we have always catered to this demographic, the recent surge in demand has prompted us to introduce the Co-Living brand to address the increasing needs more effectively.
Do RAFAL’s projects reflect your views of the future of urban living in Saudi Arabia?
As of now, we are in the construction phase of Alegria, a residential community situated to the north of Riyadh, a mere five kilometers away from the upcoming Expo site. Positioned amidst three recently announced mega projects and in close proximity to the new airport, Alegria is witnessing robust demand from young Saudi families seeking to be at the heart of the city’s transformation and vibrancy. While Alegria aligns with our core business focus on gated communities, we are adapting to evolving market trends by integrating amenities such as co-working spaces, coffee shops, yoga studios, and community services. This reflects our anticipation of the changing lifestyle preferences, including remote work capabilities, and the desire for convenience without frequent commutes to Riyadh.
Another exciting area of development for us is the Co-Living concept. With five projects already in the pipeline and five more slated for the coming year, these initiatives incorporate co-working spaces and are strategically located near urban transit systems. This underscores our commitment to offering modern living solutions tailored to the needs of our residents.
Furthermore, our foray into large-scale destination projects marks a significant step forward for RAFAL. Collaborating with partners and local authorities, we are embarking on the creation of a fully integrated community spanning over a million square meters. This endeavor will encompass schools, residences, office and commercial spaces, as well as a plethora of entertainment options, demonstrating our vision for comprehensive and sustainable urban living experiences.
What is your vision for RAFAL in the short to medium term and what would you like to achieve in that time?
In the short to medium term, our vision for RAFAL is centered around addressing urban challenges in Riyadh through our strategic projects. Our focus remains steadfast on solving these urban issues rather than simply increasing our assets under management. We believe that the city is undergoing significant development with various players entering the market, which contributes to its growing sophistication. However, with this dynamism comes gaps and challenges, and we aim to leverage our experience and track record to fill these gaps effectively. By delivering on the three levels of projects outlined, we aspire to make meaningful contributions to Riyadh’s urban landscape and foster sustainable growth in the city.
ABOUT RAFAL: RAFAL Real Estate Development Co. is a Riyadh-based real estate developer established in 2007. The Company has delivered several landmark projects marking the skyline of Riyadh including the renowned Burj RAFAL, and a number of award-winning hotels, gated communities and mixed-use developments. The Gross Development Value of delivered projects by RAFAL in Riyadh exceeds SAR 12 billion today, including more than 3,500 homes, 2 million SQM of developed land, and other commercial mixed-use spaces.
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