The region has an estimated population of 5.8 million people, according to Saudi Arabia’s 2004 census, and its capital city, Mecca, plays host to a further 15 million religious tourists a year.

The Hajj and Umrah pilgrimages to Mecca are worth $30bn a year to the kingdom’s economy and hotel occupancy rates in the city regularly top 90 per cent, even during the off-season.

Saudi Arabia has invested heavily in upgrading the region’s transport infrastructure and road network. According to regional projects tracker MEED Projects, there are more than $32bn-worth of construction schemes planned or under way in Mecca province, many of which are located in the port city of Jeddah. 

Prince Khalid al-Faisal bin Abdulaziz has been governor of the province since May 2007.

MECCA CITY

Mecca is the birthplace of the Prophet Muhammad and one of the most important sites in Islam. Unlike other key cities in the kingdom, its main source of income is not trade or oil but tourism.

The Hajj pilgrimage to Mecca is the biggest of its kind in the world and is the fifth pillar of Islam. All Muslims who have the financial means and are able-bodied have an obligation to undertake it at least once in their lifetime. In 2011, an estimated 2.9 million visitors arrived in the city during Hajj alone. Umrah, a shortened form of Hajj that can be performed at any time of the year, is also popular among devoted Muslims, meaning that Mecca remains busy all year. However, the city is out of bounds for non-Muslims.

Although it is largely associated with transitory visitors, Mecca has a large residential population of about 2 million, mainly comprising scholars and hospitality industry workers. Its population is expected to reach 3 million people by 2035.

Investment in the city has surged as the government moves to improve facilities and accommodate growing visitor numbers. Notable projects include the 37-tower Jabal Omar real estate development as well as the planned Mecca Mass Rail Transit (MMRT) network.

JEDDAH CITY

With a population of 3.5 million, Jeddah is Saudi Arabia’s second-largest and most cosmopolitan city. A busy trading port, it is also a key starting point for pilgrims on their way to the holy cities of Mecca and Medina.

The Red Sea town has historically played second fiddle to Riyadh in terms of real estate projects, with developers favouring schemes in the capital. In 2009, Jeddah Central District Company unveiled an $8bn plan to regenerate the city’s 6-square-kilometre central district. The project aims to transform the area by cleaning up Jeddah’s polluted lagoon, creating a modern infrastructure for the city centre, and preserving the historic heart of the city.

Efforts are also being made to overhaul Jeddah’s ageing infrastructure after floods in 2009 and 2011 brought the city to a standstill, exposing the weakness of its storm drainage system. More than $24bn-worth of projects are in study or under way in the port city, according to data from MEED Projects.

KEY PROJECTS

Kingdom City
The Kingdom City project is located north of Jeddah city centre on a 2-sq-km site close to King Abdulaziz International Airport. The joint-venture partners on the scheme plan to develop the land with mixed-use commercial, residential and resort facilities, including offices, residential units, a school and hotels. A bridge will be built across Obhur Creek to link the site to the city centre and airport.

A landmark building, known as Kingdom Tower, has been designed for the centre of the project and will be one of the tallest buildings in the world on completion. The tower will contain hotels, offices, residential apartments and a shopping centre.

In total, the project is expected to cost SR75bn ($20bn), with the Saudi Binladin contract for the construction of Kingdom Tower valued at SR4.6bn.

TRANSPORT

In the past, Jeddah was the main entry point for pilgrims and visitors to Mecca. Today, there are a few new options including bus travel and Medina airport, which was built in 1974. Nevertheless, the vast majority of visitors to either site find themselves passing through Jeddah, a trend that is likely to continue once a new rail link between the city and the two holiest sites in Islam opens in April 2013.

Aviation
Prince Mohammad bin Abdulaziz airport
Visitors have two options when flying into Mecca: King Abdulaziz International airport in Jeddah and Prince Mohammad bin Abdulaziz airport (PMAA) in Medina. PMAA first came into use in 1974 and is mostly used to handle domestic flights, although it also receives planes from major Muslim countries. It handles private charter jets during Hajj and is made up of a single runway and terminal. Services at the airport are minimal but the facility is currently being upgraded.

In June 2012, entry to the airport was limited to Muslim travellers only. In the past, non-Muslims could fly into the airport but not enter the city.

King Abdulaziz International airport
King Abdulaziz International airport (KAIA) is the kingdom’s third-largest and busiest airport due to the spike in traffic during Hajj. The main South Terminal is reserved for Saudi Airlines (Saudia), Air France and the kingdom’s low-cost carrier Nasair, while the North Terminal caters to most other airlines. During the Hajj pilgrimage, the Hajj Terminal (which is now two terminals) is opened to cope with the extra traffic.

As with many of Saudi Arabia’s airports, KAIA is in a poor state of repair. The General Authority of Civil Aviation is planning a major expansion initiative that will see KAIA’s annual passenger capacity grow from 13 million to 80 million. The $8.2bn scheme is being carried out in three stages, taking capacity to 30 million a year in stage one, 45 million in stage two and 80 million by completion in 2035.

The main construction packages for the airport expansion were awarded to the Saudi Binladin Group in 2010.

Rail
The Saudi government approved SR62bn of spending in August 2012 to develop a bus network and to fund the Mecca Mass Rail Transit system. The rail network is planned to help transport pilgrims around the western city during the busy Hajj period. The project will consist of four lines and will run for about 113km around Mecca city centre, with about 88 stations.

Mecca is also set to benefit from the planned Haramain High-Speed Railway project, which will link the holy city with Medina, Jeddah, the industrial town of Rabigh and King Abdulaziz International airport. Construction of the $11.9bn network is being carried out in two phases, with contracts for the project awarded in 2009 and 2011.

The railway, which will run up to 100 services a day, is scheduled for completion by April 2013.

In Jeddah, progress is also being made on the much-delayed Saudi Landbridge. The 950-kilometre-long passenger and cargo railway will link Jeddah to the ports of Dammam and Jubail on the Gulf coast, through Riyadh. The scheme was first launched in 2005 but issues involving its financing delayed construction. Saudi Railways Company is now evaluating bids from five firms to project manage the $7bn railway. 

Mecca metro
November 2011 marked the completion of a landmark project for Mecca: its own purpose-built metro network. The Al-Mashaaer al-Mugaddassah metro links Mecca, Mina, Muzdalifah and Mount Arafat and is expected to carry up to 80,000 passengers an hour during Hajj in 2012. The network will connect to both the MMRT and the Haramain railway once the projects are completed.

Jeddah metro
Jeddah is poised to join Riyadh and Mecca with its own urban metro scheme. The planned network will run for a total length of 108km along three main lines, with 46 stations. Saudi Arabia is finalising designs for the estimated $9.3bn metro project, with construction tenders due to be issued later this year.

ACCOMMODATION

Hotels
There is a huge range of hotels on offer in Mecca, from cheap and basic establishments to five-star lodgings, which some argue are not in keeping with the spirit of unity embodied by Hajj and Umrah. The rising number of religious tourists that visit the city each year has increased demand for accommodation and several hotel projects are under way to alleviate this.

The Jabal Omar Development is the largest of these and will consist of 37 towers when completed, featuring hotel operators such as Hilton International and Starwood Hotels and Resorts. The multibillion-dollar scheme is being constructed in three phases.

Thanks to a surfeit of incoming visitors, Jeddah has a lot of hotels, ranging from budget to five-star. Prices range from $50 a night to $500-plus a night, with a general rule of thumb that the further north you are in the city, the more exclusive the property.

Demand for rooms spikes during Hajj and the city’s status as a leading pilgrimage destination means that there is no actual low season.

Apartments and villas

A number of apartments in Mecca are sub-let or rented to scholars and longer-term visitors to the city. However, as with the rest of the country, most apartments are only rented out for a year at a time and most short-term arrangements are extremely informal, with Hajj and Umrah agents the best channel for arranging accommodation for up to a few months.

A shortage of decent affordable housing has led to several international investors building new developments for pilgrims and longer-term visitors. However, rents in Mecca remain higher than those seen in other major cities. On average, a family should expect to pay more than SR3,500 a month for a small apartment. Living expenses for a family of four can reach SR5,000 a month.

Jeddah’s most attractive apartments sit on the corniche, with recent major real estate developments, including Diyar al-Bahar and Corniche Dreams, all situated in the north. Compounds tend to be the most popular option for families, particularly as rules regarding the dress code for women tend to be more relaxed within them. Arabian Homes, Al-Basateen Village and Elite Villages are popular among expatriates.

The average cost of a three-bedroom apartment in Jeddah is SR37,800 a year, according to the US’ Jones Lang LaSalle, while the cost of a four-bedroom villa is SR127,000 a year. Rents are expected to continue rising in 2012 as more expatriates seek property in the city.

Office space
The main office space tenant in Jeddah is the government, although most prime real estate is taken up by the private sector. Generally, the local market has suffered from excessive supply for the past few years, something that is unlikely to change given projections by Jones Lang LaSalle that an additional 160,000 square metres of space is due to be available by mid-2013.

Major new projects include the Zahran Business Centre on Prince Sultan Street, which opened in early 2012, and the Headquarters Building on the corniche. Prime property was priced at SR1,400 a square metre in the first quarter of 2012, according to Jones Lang LaSalle, with lower-grade space on offer in the low-to-mid SR900s.

HEALTHCARE

The Saudi government covers all healthcare costs for pilgrims. However, if you plan on living in Mecca, you will have to get medical insurance. As with elsewhere in the kingdom, healthcare standards are acceptable but hospitals can get very busy during peak religious periods. The sheer volume of people attending Hajj means the likelihood of accidents - some deadly - is high. Several clinics are set up at key points to accommodate the rise in patients during busy periods.

Saudi Arabia is increasing investment in hospitals to ensure adequate access to healthcare across the kingdom. Among the planned projects is the King Abdullah Medical City in Mecca, a 1,350-bed facility that will include three hospitals and 10 medical centres.

Healthcare in Jeddah is also of a high standard. The city is home to 12 hospitals, with the Soliman Fakeeh Hospital and the Saudi German Hospital popular among expatriate workers.

There are more than $32bn-worth of construction projects planned or under way in Mecca