Riyadh, KSA: More than two-thirds of office workers in Saudi Arabia are willing to use public transportation to commute to work every day, if it is available, according to a study commissioned by leading property and asset management firm Raza, in association with international real estate association CoreNET, and the global real estate professional services firm JLL.
The KSA Office Occupier Survey, a first of its kind study in the Kingdom, noted that the average parking ratio for respondents’ offices is one parking space for every 44 sqm of leased office space. With an average of 14.1 sqm per staff, the Kingdom offers around one parking space for every three employees.
“A ratio of 1 parking space for every 44 sqm of leased office space across Saudi Arabia is competitive on a regional scale. For comparison, in markets such as Dubai and Abu Dhabi, UAE, the ratio is typically 1 parking space for every 50 sqm of leased office space. If Landlords and Developers are able offer ratios lower than market average, it can be a unique selling point used to attract tenants,” said Jack Cone, Founder of the CoreNet Saudi Arabia Chapter and Senior Analyst at JLL.
“Sixty-seven percent of tenants indicated they would be willing to use alternatives to private cars like the metro, bus shuttles, and ride hailing services. This suggests there is a real opportunity for employers and landlords to form transit partnerships that offer solutions to chronic parking and traffic frustrations in the big cities. The survey also records overall satisfaction by all categories of tenant with their office facilities and services but there is still some room to move the customer experience up to the ‘vary satisfied’ top scores. At Raza, our aim is to work with our tenants, suppliers and staff to deliver these further improvements to the Saudi workplace and real estate sector,” said John Harris, Director – Property and Asset Management at Raza, the real estate arm of Saudi Arabia’s Public Pension Agency.
Average office density in Saudi Arabia stands at 14.1 sqm, lower than the global average of 13.9 sqm. By comparison, the average density in Dubai is around 15 sqm per employee. This was mainly driven by relatively large spaces within government offices in the Kingdom, which on average provide 16.6 sqm for every employee. In contrast, multinationals have a modest 10.9 sqm per employee, similar to global business hubs such as London (10 sqm).
The survey also highlighted that most businesses are embracing open and collaborative space with an increasing amount of open plan workspaces and meeting areas as opposed to cellular desks and closed meeting rooms. Although there was a noted disparity between the ratio of spaces dedicated to open office between government agencies (50%), and Saudi private companies (46%), compared to multinationals (69%), there is an overall preference for open office space.
The study highlights that importance of incorporating support and service facilities within office buildings as employers seek to address the growing needs of employees. Survey respondents attached significant importance to a range of supporting amenities such as prayer rooms, restaurants, entertainment, retail and banking services.
“Office markets around the world are being disrupted by new technologies and new approaches to work, with occupiers increasingly relating to their premises as an experience rather than a physical commodity. This has important implications for how office space is delivered and used in Saudi Arabia. Although nearly 80% of the tenants were satisfied with their workplaces, the rapidly evolving business environment and growing tenant demands will require landlords to remain flexible and adapt to the changing landscape,” said Toby Hall, Head – Middle East Chapter for CoreNET Global, and Head of Business and Office Leasing at JLL UAE.
“A better understanding of how tenants use their projects is an essential first step. Responding to these requirements in a proactive manner will allow developers and asset managers to differentiate their projects in an increasingly completive marketplace, thereby helping them outperform the overall market in terms of occupancies, rental levels and capital values.” Hall concluded.
The first-of-its-kind survey in Saudi Arabia provides commercial real estate (CRE) benchmarking data to compare against global trends in the real estate sector. Survey respondents included government, private and multinational companies, representing sectors including IT, Retail, Engineering and Infrastructure and Financial Services. More than three-quarters of the respondents were based in Riyadh with others located in Jeddah, Dammam, and Khobar.
The first edition of the KSA Office Occupier Survey can be downloaded from here.
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About Raza
Raza is Saudi Arabia’s leading property asset manager and developer, focused on managing high-quality assets in the Kingdom. With over SAR13 billion million of real estate assets under management (AUM), Raza is one of the largest asset managers in the Kingdom operating a portfolio of multiple asset classes including residential, commercial and mixed-use developments.
Established in 2007 as Al Ra’idah, the company has recently been rebranded to Raza, a subsidiary of Al Ra’idah Investment Company (RIC) which in turn is owned by the Public Pension Agency (PPA) of Saudi Arabia.
About CoreNET
CoreNet Global is the world’s leading professional association for corporate real estate (CRE) and workplace executives, service providers and economic developers. CoreNet Global’s more than 11,000 members, who include 70% of the top 100 U.S. companies and nearly half of the Global 2000, meet locally, globally and virtually to develop networks, share knowledge, learn and thrive professionally. For more information, please visit www.corenetglobal.org
About JLL MEA
Across the Middle East and Africa (MEA) JLL is a leading player in the real estate and hospitality services markets. The firm has worked in 35 countries across the region and employs over 800 internationally qualified professionals across its offices in Dubai, Abu Dhabi, Riyadh, Jeddah, Al Khobar, Cairo, Casablanca and Johannesburg. www.jll-mena.com
For more information about the study, please contact:
Ajith Henry
Hill+Knowlton Strategies
+966 56 993 2538
Email: ajith.henry@hkstrategies.com
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