Colliers International MENA

Cost Consultancy Services

2019

Saudi Arabia
Construction Costs
Update – Oct 2019

QUARTER 4 | 2019
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Oct 2019 | KSA
KSA – Construction Cost | Colliers International

Saudi Arabia
Construction Cost Benchmarking 2019 (4th Qtr)
Cost Range
Item Building Type
(SAR/m2)
Residential
1 Villa - Commercial Specification 1,901 - 2,411
2 Villa - Medium Specification 2,601 - 3,782
3 Villa - Medium High Specification 3,751 - 4,835
4 Apartment Low to Medium Rise - Commercial Specification 2,411 - 2,910
5 Apartment Low to Medium Rise - Medium Specification 2,979 - 3,950
6 Apartment High Rise - High Specification 4,849 - 5,958
Commercial (Shell and Core Only)
7 Office Low Rise – Commercial to Medium Specification 2,561 - 3,356
8 Office Medium Rise - Medium Specification 3,310 - 4,008
Industrial
9 Data Centre – Tier 3 (SAR/KW) 56,625 70,875
10 Light Duty Industry 1,672 - 2,631
11 Medium Duty Industrial 2,511 - 4,833
Hotels (Including FF&E)
12 Three Star 4,911 - 6,617
13 Four Star 6,591 - 8,496
14 Five Star 8,211 - 9,868
Retail (Shell and core with public area finished)
15 District Mall 3,805 - 5,358
Car parking
16 Podium 1,851 - 2,405
17 Basement 2,208 - 2,865

Professional fees, land acquisition costs and financing costs are excluded from the above.
All hotel rates are inclusive of Furniture, Fittings and Equipment (FF&E).
Costs/m2 are based on GIA as per the RICS code of measuring practice 6 th edition.
Cost ranges capture the average, based on all regions throughout Saudi Arabia.
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Construction Cost Movement
Materials
For the Period Q3 2018 to Q3 2019, prices for key construction materials remained stable overall, with slight
individual movements. Below shows the percentage movement, of a representative sample of material, through
this period.

Oct 2019 | KSA

KSA - Construction Cost | Colliers International
Timber Block Work Marble Tile Aluminum
-0.7% -2% -3% -3%

Sand Concrete Rebar Cement

+4% +3% +1.5% +4%

Labour Costs
The Nitaqat program is achieving its goal which is to increase the demand for the Saudi workforce. However,
this coupled with a shortage of skilled and semi skilled construction workers, is contributing to an overall rise in
labour costs.

The Market Outlook

The construction industry is anticipating growth and the outlook appears promising from 2020 onwards, mainly
driven by the increase of government spending and a growing population.
Government backed giga-projects such as Neom, Qiddiya Entertainment City, The Red Sea Project etc., as well
as Social Housing schemes are expected to boost construction activity in the coming years.

Inflation Outlook
Colliers International predict that construction cost inflation will average at 3.2% over the next 12 months.
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Colliers International Construction
Consultancy
As specialist construction consultants we provide
project, cost and construction management services.
Our success is based on two simple principles;
Oct 2019 | KSA
KSA – Construction Cost | Colliers International

i. Construction advisory that is tailored to each

client, based on the knowledge of our staff whom
first and foremost are construction people.
ii. Our services ensure risks are eliminated, quality
of design & construction is delivered, optimum
program timelines are achieved, all at the lowest
price possible.

Our Project Management & Cost

Consultancy Services include:
Project Management
> Development Management
> Program Management
> Project Management
> Client Representation
> Construction Supervision
> Tenant Coordination
> Building Surveying

Quantity Surveying
> Cost Modelling & Benchmarking
> Cost Planning/Management/Control
> Risk Appraisal
> Life Cycle Costing
> Value Engineering
> Procurement Strategy & Advise
> Tendering & Evaluation
> Tender Documentation & Bills of Quantities
> Contract Documentation & Administration
> Cash Flow Forecasting

Project Monitoring
> Bank/Financial Institution Representation
> Early Warning Advice
> Project Cost Analysis and Advice
> Program Monitoring
> Stage Payment Recommendations
> Quality & Specification Inspections
FOR MORE INFORMATION

Bob Flanagan
Managing Director | MENA
Project Management & Cost Consultancy Services
bob.flanagan@colliers.com