Saudi Arabia’s ambitious vision for growth continues to captivate global business leaders, with the latest milestone being the proposed 2-kilometre megatall tower in Riyadh. This project, spearheaded by the kingdom’s Public Investment Fund (PIF), underscores the booming Saudi construction sector and signals a wealth of opportunities for foreign firms across all aspects of the construction industry from project management to supply of materials.
The Saudi construction industry is experiencing unprecedented growth, driven by the kingdom’s Vision 2030 agenda to diversify its economy. The PIF has invited firms to bid for the project management consultancy (PMC) role on a new central business district (CBD) on the outskirts of Riyadh, which includes the groundbreaking 2km tower. This tower, poised to dwarf Dubai’s Burj Khalifa—currently the world’s tallest at 828 metres—represents a bold leap in architectural ambition. The PMC role encompasses both the tower and the surrounding district, offering a significant scope for international players.
The request for proposals (RFP) was issued by the Tower District Real Estate Development Company, a PIF subsidiary, with an initial bid submission deadline of 4 March. Recognising the complexity and scale, the PIF extended this deadline to 20 March, giving prospective bidders—such as US-based Aecom, Bechtel, Jacobs, Parsons, and Turner, alongside the UK’s Mace—additional time to prepare. This extension reflects the kingdom’s commitment to attracting top-tier expertise, opening doors for foreign firms to engage in Saudi construction at its most transformative stage.
This tower isn’t just a feat of engineering—it’s a symbol of Saudi Arabia’s economic evolution. The value of construction contracts awarded annually has soared from $55 billion in 2014 to $142 billion in 2023, according to Knight Frank, with projections reaching $182 billion by 2028. This trajectory could position Saudi Arabia as the world’s largest construction market, surpassing even traditional powerhouses. Beyond flagship projects like Neom, the kingdom is home to at least six giga-projects—monumental initiatives defined by their scale or investment—fuelled by events like the 2029 Asian Winter Games, Expo 2030, and the FIFA World Cup 2034.
The population, currently at 34 million, is expected to grow by 13 million over the next 25 years, driving demand for 115,000 residential units annually, per Knight Frank. Add to this the rising need for office, industrial, and commercial spaces, and it’s clear why local suppliers and Saudi companies—along with those from the Gulf Cooperation Council—are struggling to keep pace. This gap creates a golden opportunity for foreign construction firms to step in, provided they navigate the market entry process effectively.
The megatall tower, designed by UK-based Foster & Partners following a 2022 competition, is set to redefine skylines and engineering benchmarks. At over twice the height of Burj Khalifa and significantly taller than the 1,000-metre-plus Jeddah Tower, it’s a testament to Saudi Arabia’s ambition. The Jeddah Tower, managed by Turner (the firm behind Burj Khalifa), recently saw concrete pouring commence on 20 January, with contractor Saudi Binladin Group receiving $190 million for its work under a $2.1 billion contract. Completion is slated for 2028, reinforcing the kingdom’s rapid construction momentum.
The Riyadh tower, however, takes this ambition further. With a surrounding business district under development, it’s not just a standalone structure but part of a broader urban ecosystem. For foreign firms, securing a role—whether in project management, consultancy, or supply—means tapping into a project with global visibility and long-term economic impact.
The Saudi construction boom extends far beyond this single tower. Infrastructure projects like the Riyadh Metro expansions, new ports, highways, 11 stadiums, and the King Salman International Airport—set to be among the world’s largest—are reshaping the kingdom. These developments, coupled with giga-projects, signal a sustained demand for expertise and resources that local markets alone cannot meet.
Entering the Saudi construction sector requires more than technical expertise—it demands a solid grasp of local regulations and business setup processes. This is where Peninsula’s 15 years of regional experience becomes invaluable. Our team combines deep regulatory knowledge with practical business acumen to streamline your expansion journey.
Setting up a company in Saudi Arabia involves choosing the right entity—be it a limited liability company (LLC), Joint Stock Company (JSC), or joint venture with a local partner. Each option has implications for taxation, liability, and operational flexibility. For construction firms, an LLC often balances control with compliance, while a joint venture can leverage local expertise and networks.
Regulatory changes of the past few years have seen a significant increase in 100% Foreign Owned Construction companies, who are entering the market and winning lucrative contracts to support major local firms such as the Saudi Binladin Group. The message coming out of the Kingdom is clear, Saudi Arabia is open for business and global suppliers are required to help to meet demand.
The rapid growth in demand for construction in Saudi Arabia is drawing global interest as we see a diverse range of suppliers from all over the globe set up in the Kingdom, covering in-demand areas including desalination, supply of materials such as aluminium and glass, and sustainability.
Peninsula simplifies the process by handling commercial registration, licensing, and partnerships, ensuring your business aligns with Vision 2030 priorities and PIF-driven projects.
Collaboration with Saudi entities is often key, especially for government-backed initiatives like the Riyadh CBD. The PIF’s focus on localisation means foreign firms may need local sponsors or subcontractors. Our experts at Peninsula can identify reliable partners and negotiate terms that protect your interests while meeting regulatory requirements, smoothing your path into the market.
The extended bid deadline for the Riyadh tower project—now 20 March—offers a window to position your firm. With global players like Bechtel and Mace already in the race, early movers gain a competitive edge. Beyond this project, the broader Saudi construction landscape promises sustained growth. The industry’s near-tripling in value over a decade reflects a market hungry for innovation and capacity—precisely what foreign firms can provide.
Foreign Owned Companies have the opportunity to embed their business in a region poised for decades of opportunity. The kingdom’s infrastructure push, population growth, and global events create a demand pipeline that’s rare in its scale and stability.
At Peninsula, we’ve spent 15 years helping entrepreneurs, SMEs, and multinationals enter and thrive in Saudi Arabia and the UAE. Whether you’re a construction firm eyeing the 2km tower or a supplier targeting residential projects, our expertise in company formation and business setup ensures a seamless transition. Our team understands the nuances of regional licensing and the practical steps to turn opportunity into success.
The construction of this megatall tower marks a pivotal moment for foreign firms in Saudi Arabia. It’s a chance to join a transformative wave, backed by the PIF’s vision and the kingdom’s relentless drive. With Peninsula by your side, you’re not just entering a market—you’re building a legacy in one of the world’s most dynamic economies.
