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In November 2024, Saudi real estate giant and Public Investment Fund (PIF) company ROSHN Group announced a new strategic focus that expanded its remit to include asset classes beyond its core residential offering.
The Group's new portfolio includes its core asset classes, comprising 200 million square metres (sqm) of residential property and over 4 million sqm of gross leasable area (GLA) spanning retail, commercial, and hospitality sectors.
In addition to its core offerings, the portfolio features enabling assets such as education, mosques, and healthcare facilities. It also includes opportunity assets in transport and logistics, such as warehouses, industrial parks, and knowledge hubs, as well as leisure and entertainment options, ranging from entertainment centres to fitness hubs.
Digital sales success
This ambitious multi-asset strategy is driven by a strong commitment to digitisation and customer-centricity, with a particular focus on enhancing the experience and offerings of residential real estate products.
By May 2024, ROSHN launched a comprehensive app enabling home purchases, community service requests, and access to amenities, building on its August 2023 introduction of a digital home acquisition journey.
"The idea was to digitise and connect the physical spaces we create and make it convenient for the users and the people living in the community," explained ROSHN's Executive Director of Digital Products Pablo Salcedo.
The success of ROSHN's digital sales journey since its launch, with an average of 50 per cent of its residential sales now conducted online, has positioned the company as a digital innovator within the real estate sector.
"Out of the 50 per cent, 8 per cent were finalised by people who never visited our sales centres," said Salcedo. "They did it from home, and that's a metric that we didn't fully anticipate. It was word of mouth and the trust reposed in ROSHN as a real estate developer."
The developer's digital sales journey is facilitated by the Kingdom's digital ecosystem and national identity card for citizens, akin to Emirates ID in the UAE, which is verified through the Absher app.
"We allow the customer to validate their identity and then sign a contract with an OTP instead of having to sign hundreds of pages of paper," he explained. "The digital ecosystem of Saudi allows this."
According to Salcedo, ROSHN's digital journey customers needn't come onsite to sign their papers or swipe through a POS. Moreover, they can also get advice on how much the mortgage is going to cost and even preview the inside of the house with a 3D view.
For customers who may not be tech-savvy or prefer a more personalised touch, a sales advisor can initiate the purchase process physically or virtually.
"We assist them in certain parts, but they can finish the transaction at home," he said.
The process is also location-agnostic, where the buyer is concerned.
"You don't need a power of attorney, so you can be in Jeddah and buy in Riyadh and vice-versa, and you don't have to move yourself," he said, adding that digital as well as hybrid modes save customers a significant amount of time by reducing or eliminating multiple trips to the sales centre.
Quantifying online sales
According to Salcedo, the 50 per cent online sales figure evolved over time, beginning with the Al Arous project and later expanding to include the Sedra and Warefa residential communities, along with additional phases of Sedra.
"From a reservation perspective, that's where we have the funnel," he explained. "In the last four months, more than 80 per cent of the people have reserved online either physically through the digital journey or fully online, which is a very big step."
Although online booking also simplifies the cancellation process, the ROSHN executive highlighted that over 82 per cent of customers paid their token booking amount online within the past four months.
He noted that it's too early to quantify or assign a dollar value to online sales.
"We are trying to define the barriers between physically assisted, remotely assisted and fully digital. What we can confidently state is that 8 per cent of the 50 per cent achieved so far is fully digital."
Looking beyond sales
ROSHN's digital innovation extends beyond sales to ensure the seamless integration of buyers into their new community. Currently, the digital process addresses payment milestones for buyers and basic services for residents.
Salcedo elaborated: "We're addressing the gaps between the sales phase and the community experience post-handover. This includes streamlining processes like payment milestones, customer communication, and providing updates on construction progress. We're also working to enrich the community experience by offering access to complementary services and products like car washing or products that can add value like nurseries and nanny services."
ROSHN is also investing in technologies like digital twins, augmented and virtual reality, and interactive maps to enhance the discoverability of what it is selling.
"It's a place where we are going deeper and deeper, and we are trying to see how we unify our assets in order to make that work better," said Salcedo.
Regarding smart contracts and blockchain, he clarified that the digital environment in the Kingdom facilitates the use of smart contracts without relying on blockchain technology. For example, a licensed entity enables digital signatures for contracts and loan requisitions, reflecting the highly digital nature of the ecosystem.
He continued: "When blockchain matures, it will help in moving from off-plan to a secondary market in a more consistent way. But currently, for our primary use cases in the off-plan, the ecosystem already enables us."
On Artificial Intelligence (AI), ROSHN is starting with internal use cases to streamline processes, get to know customers better and improve research capabilities.
Salcedo said the strategy involves initially testing initiatives internally. Once refined, these are introduced to community members residing in ROSHN developments. Following this, the offerings are extended to the broader audience through platforms like ROSHN Front, the retail and lifestyle destination in Riyadh, which also marked the Group’s first expansion into non-residential verticals.
This phased approach, he stated, aims to connect and integrate the entire ecosystem.
Future plans
Looking ahead to 2025, ROSHN plans to expand its digital capabilities, aiming to enable sales outside the Kingdom and to non-Saudi residents. Salcedo said the Group expects to be able to sell to Saudi Arabia's 'premium residency visa' holders next year.
"Currently, it is available physically, but it will be available digitally hopefully before the end of January 2025," he said.
He also underlined that there are ambitious plans for digital sales.
"The average is 50 per cent, but we have hit 80 per cent, so potentially, we would like to hit 90 per cent," he said.
An interesting trend has been the growing penetration among non-tenants, potentially leading to future sales opportunities.
"The customers of ROSHN Front are north of 8 million, far exceeding the number of customers who purchase our homes," he observed.
According to Salcedo, in the near future, ROSHN may develop a secondary market for its own real estate products, leveraging the "healthy balance" between those who purchase properties in the company's communities for investment and those who buy to live in them. Investors seeking liquidity could create an opportunity for ROSHN to move opportunistically and establish a secondary market within its own communities.
"It is something that is potentially in the plan, but a little bit opportunistically," he concluded.
(Reporting by Anoop Menon; Editing by SA Kader)
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