Plans to develop the King Abdullah Financial District in Riyadh as the largest business zone in the Middle East could be delayed by up to six months, because of changes to the original masterplan.
Bids were due to be submitted in April for the first major construction contracts on the project. The four packages cover 10 buildings within the development. However, the bids have been withheld while a review of the masterplan is finalised.
According to a source close to the project, the masterplan is being modified, with the original road system being re-evaluated and changes made to the schedule for building different elements of the scheme.
“The bids were due on 21 April, but they [the bidders] were told not to submit them, as the masterplan needs work,” says the source.
Under the original masterplan, the 10 buildings were due to be constructed in different zones around the site. However, the client has decided to develop them on a smaller number of plots, which should reduce any potential logistical problems.
“Before it wanted 10 plots dispersed throughout the masterplan,” says one contractor bidding for the work. “It looked at having buildings on separate sections of the development.
“Now it is shifting its idea to give each contractor one zone on which to concentrate. So it will minimise co-ordination issues.”
The $7.8bn project is located in the south of Riyadh, but no construction work has yet started.
Despite the delays to the scheme, the client, Saudi Arabia’s Public Pension Association, is keen to press ahead with the development and is in talks with a contractor to begin earthworks within a month. “It is anxious to start,” says the contractor. “It does not want to wait six months. It is keen to break ground.”
Once completed, the district will cover 1.6 million square metres and will be home to the Saudi stock exchange (Tadawul) as well as the Capital Market Authority, which regulates the market, and a financial academy for 5,000 students.
The original masterplan was approved by the Executive Committee of the King Abdullah Financial District in March 2007 and was made up of three main sections defined by use.
The Leaf is a mixed-use area, with 23 per cent planned for residential use, 5 per cent for retail space and the remaining area taken up by offices.
The northwest area will feature support services, utilities and parking, while the south area will feature residential and office accommodation.
Denmark’s Henning Larson Architects is responsible for the masterplan in collaboration with the local Omrania. The US’ Hill International is the project manager for the scheme.
According to the original plan, work was due to be completed by the end of 2013.
Once finished, it will have to compete for market share with other growing financial clusters around the Gulf, including Dubai, Doha and Manama.