Gulf Construction Online - Construction booms in the holy cities

Makkah & Madinah

Construction booms in the holy cities

A massive $8 billion nod given for expansion projects in Makkah and Madinah has given further impetus to the already booming construction market in these cities which continue to expand to accommodate the huge influx of pilgrims.

01 December 2004

The construction industry in Makkah and Madinah – which continues to ride high on the crest of an ongoing boom that is fuelled by a real estate bonanza – can look forward to even sunnier days ahead.

Early last month, Saudi Arabia’s Crown Prince Abdullah gave the nod to massive projects worth SR30 billion ($8 billion) for the development of Makkah, including a plan to expand part of the Grand Mosque.
In addition, the kingdom has launched a new tourism strategy with its proposed Umrah-plus – a package that aims to combine the minor pilgrimages to Islam’s holiest sites in Makkah and Madinah with leisure, in a bid to activate the industry.
Makkah is the obvious focal point for religious visitors. In the first six months of 2004, its revenues were 9.1 per cent higher than in the corresponding period of last year.
About two million pilgrims including 1.3 million from abroad performed Haj last year, and this figure is expected to increase by five per cent this year, according to Haj Minister Iyad Madani.

Grand Mosque/Jabal Omar
Saudi authorities intend to expand part of the Grand Mosque's built prayer areas to accommodate 200,000 worshippers and construct hotels, residential towers and commercial centres.
It includes expansion of the mosque’s northern courtyard by 1.2 million sq m.
Six designs have been prepared by international companies for the project, which is to cover the area between the mosque and the second ring road to the north, Masjidul Haram Street to the east and Jabal Al Kaaba Street to the west.
Reports of the expansion plans come on the heels of the SR12 billion ($3.19 billion) Jabal Omar residential tower project on the western side of the mosque.
Work on the project, which will change the face of Makkah, began with the demotion of 580 buildings in the area to pave the way for the erection new residential towers designed to accommodate 34,500 people.
The Jabal Omar project, spread over an area of 230,000 sq m, is one of the largest schemes aimed at developing areas surrounding the Holy Haram with five-star hotels and commercial centres.
The project will have 4,500 shops and 3,000 showrooms, a central transport station and parking facility for 12,000 vehicles.
“It will create a model residential and commercial centre with new roads, pathways, tunnels, electric stairs, and other facilities,” said Abdul Rahman Faqeeh, chairman of Makkah Construction Company which is spearheading the project.
The Makkah development authority recently completed a survey for the project and set the market value of the real estate at SR4.2 billion.
Owners of Jabal Omar plots have the option either to join a new joint stock company or sell their property to it for development.
The project site is bordered by Umm Al Qura Street to the north, Duhlat Al Rushd to the south, Ibrahim Al Khalil Street to the east, and Al Hafaer and Al Tendbawi to the west.

Zam Zam Tower
Meanwhile, the first timeshare property in Saudi Arabia is being built in Makkah, next to the Grand Mosque. The Zam Zam Tower Complex will offer leases on flats ranging from royal suites to studios for periods of one or two weeks over 24 years.
The project, which enjoys official backing, is funded by Sharia-compliant finance based both on an Islamic bond, Sukuk Al Ijara, and on a Sukuk Al Intifaa or timeshare bond.
The Waqf religious authorities, which own the land adjacent to the mosques in Makkah and Madinah, have leased the land for 28 years to the giant Binladin Construction Group on a build-operate-transfer (BOT) agreement to develop a shopping centre, four towers and a hotel.
The Binladin Group, in turn, has leased the project to the Kuwait-based Munshaat Real Estate Projects, which has awarded the management contract for a 1,240-room residence and hotel at the complex to the French hotel group Accor.
The initial investment for the first phase has been put at $390 million, rising to $750 million towards completion.
The property will also house a five-star hotel and a large convention hall, to be connected through a shopping mall and retail facility.

Al Shurfah project
Last August, the Al Salam Group/Aqar Holding Company awarded the SR1.03 billion ($275.9 million) Al Shurfah Project to Al Mabani Company.
The project, which overlooks the courtyard of the Grand Mosque in Makkah, includes a three-level commercial centre for showrooms and residential accommodation with guestrooms located on 17 floors, apartments on three levels and luxurious duplex accommodation on one level. In addition, it will unclude a basement level for services, and two levels each for prayer areas, catering facilities, car parking and for a bus terminal.
The highlight of the commercial centre is that the first and second floors are on Ajiad Street and Al Haram courtyard.
Al Mabani will assign execution of the building’s structure to the Malaysian Stam Steel, which specialises in steel structures, giant residential projects and skyscrapers.

Al Haram complex, Madinah
Aqar Holding Company has also signed a SR971.4 million ($258.9 million) contract to construct the Al Haram commercial and residential centre project in Madinah. The project – also to be implemented with Al Mabani Company – includes the Bani Najjar market, two residential towers (one seven star and another five star), in addition to seven hotel-standard residential towers, containing 1,458 residential units.
The nine towers will have 24 floors each, with six basement levels – five for car parking and one for commercial purposes. The ground, first and second mezzanine levels of each tower will be commercial floors.
Haram Centre is located adjacent to the Holy Mosque courtyard, occupying the complete eastern side with a façade extended to 350 m with a total area of 13,650 sq m.
Construction, which is now under way, will last 30 months. Priority will be given to Bani Al Najjar Mall, the most important component of the Al Haram Project to be constructed in 14 months – will open even as construction work on other parts of the project continues.

Other projects
Besides these mega projects, a number of major infrastructure and support facilities are being built.
According to news reports, other developments planned for Makkah include new educational and health projects worth SR5.7 billion, municipal projects valued at SR2.7 billion and water projects of SR600 million. Plans include expansion of Makkah’s main medical centre, Ajyad Hospital, expansion of King Khalid bridge/El Muayssem road and tunnel works in Makkah construction of the headquarters of the Haj Research Centre, a centre for Islamic sciences and conference halls.