King Abdullah Economic City (Kaec) was launched in December 2005, the first of six economic city projects planned for the kingdom

" /> King Abdullah Economic City (Kaec) was launched in December 2005, the first of six economic city projects planned for the kingdom

" /> King Abdullah Economic City (Kaec) was launched in December 2005, the first of six economic city projects planned for the kingdom

" />

King Abdullah Economic City

18 September 2012

The $27bn King Abdullah Economic City (Kaec) was launched in December 2005, the first of six economic city projects planned for the kingdom

The scheme is being built at Rabigh, 100 kilometres north of Jeddah, and is expected to house 4.5 million people, while creating 1.3 million jobs.

Kaec will be linked to the cities of Jeddah, Medina and Mecca by the $11.5bn Haramain High-Speed Railway, which is currently under construction. The development is expected to cover a total area of 168 million square metres. It comprises six integrated zones: the seaport, industrial zone, central business district, waterfront resort area, education zone and residential zone.

The economic city has been designed with a focus on the port and logistics, light industry and service sectors. Kaec is being developed by Emaar, The Economic City (Emaar EC), a subsidiary of Dubai’s Emaar properties.

Mohamed Alabbar is the current chairman of the Kaec development, and Fahd al-Rasheed is the chief executive officer overseeing the development of the scheme. After six years of little progress, in May 2011, the Saudi government pledged a SR5bn ($1.3bn) loan to accelerate the construction of the scheme. The government loan came shortly after the first gas allocation for the project was awarded in March, another key stimulant for the growth of the city. The local Al-Rajhi Steel received a gas allocation from the government to enable it to develop a $3bn integrated steel complex at Kaec.

Port

The Kaec seaport, one of the focal points of the development, was the first major part of the scheme to commence production. When completed, it is expected to be the region’s largest port and have a total container capacity of more than 10 million 20-foot equivalent units. In May 2011, the first phase of dredging works was completed and with the second phase under development, Emaar hopes the port will be ready to receive ships in early 2013.

The seaport will be located at the heart of the industrial area of the Kaec development to enable the growth of the manufacturing and industrial sectors, which are planned to form the key economic drivers of the development.

Industry

With work on the port under way, and basic infrastructure and utility works completed, land is now available for manufacturers to acquire and begin construction on the second and third phases of the industrial valley. The second phase is right next to the seaport, while the third phase is located adjacent to the second. The minimum size of plots available on each phase is 20,000 square metres.

Kaec is expected to house 2 million people, while creating 1 million jobs

In addition to Al-Rahji Steel, some of the first companies that have signed contracts to build manufacturing plants at Kaec include Saudi Total Lubricants Company (Satlub), which will establish a lubricants factory, and the US-based pharmaceutical firm Sanofi-Aventis, which signed an agreement with Emaar EC to set up a manufacturing facility.

In June 2012, the local Cigalah Group, a regional distributor of food, medicine and cosmetics, signed a contract for two land plots at Kaec, one with a total area of 125,000 square metres and one with a total area of 73,000 square metres. The group plans to establish a pharmaceutical plant in partnership with the UAE’s Julphar, one of the biggest pharmaceutical companies in the GCC. The agreement with Cigalah follows on from the handover of the first land to international pharmaceutical giant Pfizer in late 2011.

In the first six months of 2012, the local dairy food producer Almarai and confectionery producer Mars Saudi Arabia both signed deals to establish multimillion-dollar manufacturing plants at Kaec. 

Residences

Kaec’s residential sector is planned to contain 250,000 apartments and 25,000 villas. It will also include 120 hotels with more than 25,000 hotel rooms. The adjoining retail section will cover a total area of 8.7 million square metres and contain more than 50,000 shops.

In June, the local Saudi Binladin Group completed the first two residential towers at the Bay La Sun Village, part of the economic city. The Beach 1 and Beach 2 developments contain a total of 232 residential units and other facilities such as restaurants, a swimming pool and a gymnasium. When completed, the Bay La Sun Village will cover a total area of 2.3 million square metres.

In June 2011, off-plan plots of land for the first phase of the Al-Talah Gardens scheme sold out within four hours of going on sale. They were sold for SR500-700 a square metre.

In May 2012, the local Alinma Bank signed a contract with Kaec to become the first bank to finance the purchase of real estate units, including apartments, villas and land, in the economic city scheme. The developers of Kaec are confident this will help to stimulate increased demand and progress with the scheme.

Contact details

Riyadh sales centre
Tel
: (+966) 2 615 9999
Tel: 800 11 800 10
Website: www.kingabdullahcity.com
Working hours: Saturday to Wednesday, 9am-4pm

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