The value of contracts awarded in Saudi Arabia’s construction sector during the second quarter of this year topped SR82.8 billion ($22 billion), staging a strong comeback compared to the first quarter, said a report.
It marked a 45 per cent increase over the first quarter, which stood at SR57 billion ($15 billion), the NCB stated in its Construction Contracts Index report. Despite falling oil prices, the awarded contracts in the first half of 2015 showed a higher pace than 2014, but was likely to weaken in 2016, it said.
The roads and residential real estate sectors took the lion’s share (57 per cent) of the total spending, while the power sector came third with 14 per cent of the value of awarded contracts, stated the report.
Key road schemes in the second quarter included the SR23-billion ($6.13 billion) Makkah project awarded by Umm Al Qura for Development & Construction to Dallah Albaraka Group. It features a mixed-used infrastructure known as Tareeq Al Mawazee that will focus on widening the main road into Makkah and redeveloping the land on both sides of the highway, and is expected to be completed by the first quarter of 2025.
A contract worth SR6.6 billion ($1.75 billion) was also awarded by Umm Al Qura for Development & Construction to Nesma and Partners for building roads and general infrastructure. It is expected to be completed by the fourth quarter of 2019.
Additionally, the Ministry of Transportation awarded a contract worth SR225 million ($60 million) to Bin Tamy Saudi Pan for Taif, Al Baha and Abha road expansion.
The Arriyadh Development Authority awarded three contracts worth SR5.02 billion ($1.3 billion). The first was awarded to Yuksel Construction, while the second and third were awarded to Saudi Constructioneers. These projects include rehabilitation works, and construction of 21 bus rapid transit stations, 2,574 community bus stops and seven pedestrian bridges with all civil, mechanical and electrical works. The first and third contracts will be completed by the second quarter of 2017, and the second by the fourth quarter of 2016.
Within the residential real estate sector, three major contracts were awarded. The largest, worth SR5.2 billion ($1.38 billion), was given by the Ministry of Interior to El Seif Engineering Contracting to build a residential compound in Najran comprising 2,800 units. The project is expected to be completed by the second quarter of 2018.
The second and third projects worth SR750 million ($200 million) and SR375 million ($100 million) were awarded by the Ministry of Housing to Emdad Najed Group for constructing residential units featuring 985 apartments. Both projects are expected to be completed by the second quarter of 2018.
In commercial real estate, two contracts worth SR4.03 billion ($1 billion) were awarded by Arabian Centers to Fare Construction. The first was for developing a mega-scale mixed-use project called Dhahran Boulevard in Dhahran city and the second was for constructing the Mall of Arabia in Riyadh. These two projects are expected to be completed by 2015 and 2018, respectively.
Within the healthcare sector, two contracts were awarded amounting to SR937.6 million ($249 million). The first was for building a 400-bed hospital in Riyadh for completion by the second quarter of 2018. The second was for a 300-bed hospital which is due to be completed by the fourth quarter of 2018.
In education, the Ministry of Higher Education awarded two contracts worth SR221.3 million ($59 million). The first was for the construction of a college for women in Zulfi at Al Majmaah University, while the second was to construct a college of art and science in Kamel at King Abdul Aziz University.
In the power sector, three major contracts were awarded. The largest, worth SR7.1 billion ($1.89 billion), was awarded by Saudi Aramco to a JV of Air Products & Acwa Holding for construction of multiple power plants at Jizan refinery. The second, worth SR450 million ($120 million), was awarded by Saudi Electricity Company (SEC) to Archiorodon for building the PP13 power plant at Riyadh. The third, worth SR450 million ($120 million), was awarded to Al Gihaz Holding for building Tabuk substation 380/kV, and associated facilities.