The Impact of 2030 Vision on Commercial Real Estate Sector in Saudi Arabia - Literature Review Draft

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THE IMPACT OF 2030 VISION ON COMMERCIAL REAL ESTATE SECTOR IN
SAUDI ARABIA
Literature Review Draft

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Table of Contents
Literature Review............................................................................................................................3
Challenges of the real estate market............................................................................................3
Revival of the real estate market.................................................................................................4
Impact of Saudi Vision................................................................................................................5
Future of the real estate market...................................................................................................6
Research Gap...................................................................................................................................7
Reference List..................................................................................................................................8

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Literature Review
Nurunnabi (2017) says that, Saudi Arabia, for gaining sustainability it has developed a vision of
diversifying its economy. Although oil and gas are the economy’s pillars, the country has also
started with expansion in its investment for the other sectors as well. In order to overcome the
issues which might arise in the path of Saudi towards achievement of sustainability, it has
established certain long-term plans. In the past 25 years, the country has seen an annual growth
of more than 4 per cent, according to Arab News (2018). Saudi possesses several state-owned
assets which include aspects such as the properties, other assets and the leading companies of the
country. These state-owned assets are rapidly getting privatized. Due to such privatization, the
revenues of the country would be benefitted with greater levels of diversification. It would also
assist in stabilizing its financial resources as well as the economy itself. These financial
resources are utilized by re-investing them in the long run. Nurunnabi (2017), in his work talks
about the future plans of Saudi Arabia. The country aims at increasing its overall returns on
investment and the efficiency of its funds management, which would subsequently enable the
diversification of its government resources and the economy. Instead of competing with the
private sector, the public sector’s private fund would rather help in opening the sectors that
demands huge amount of capital. As such, National corporations would be developed and new
sectors of the economy would be established. This assessment has been carried out particularly
for focusing upon the real estate sector of the country, Saudi Arabia, and affect of Saudi Vision
2030 on the real estate industry of the country. The challenges and issues that the country has
been facing throughout its journey of moving towards being sustainable, have also been
discussed.
Challenges of the real estate market
Saudi Arabia planned for occupier expansion in 2017, which continued to get weighed upon due
to economic uncertainties. This especially happened in Riyadh where the Government
organizations remained to be the primary occupier of office spaces. The tight market liquidity
which was triggered by the decrease in the oil prices attributes the flat and dull performances
(Arab News, 2018). This was further inflamed by the combination of further intrinsic factors
such as limited access to funds and deficiency of affordability. The factors also included a