Saudi Arabia opens real estate investment in Makkah and Madinah to foreigners

The Saudi Capital Market Authority (CMA) has announced that foreigners can now invest in listed companies owning real estate in Makkah and Madinah.

The decision, which is effective immediately, is part of the Kingdom’s efforts under Vision 2030 to diversify its economy and attract foreign direct investment (FDI).

Under the new regulations, foreign investments are restricted to shares or convertible debt instruments of listed companies, with non-Saudi ownership capped at 49% of a company’s shares. Strategic foreign investors are not permitted to hold stakes in these firms.

The move aligns Saudi Arabia with regional trends, where neighboring countries allow foreign property ownership in designated areas. The CMA stated that the changes aim to attract FDI, boost liquidity, and support ongoing developmental projects in Makkah and Madinah.

The Kingdom has set a target of attracting $100 billion in FDI by 2030 and has introduced several reforms, including allowing foreign residents to invest directly in the stock market and granting qualified foreign institutions access to listed securities. In 2021, the CMA permitted non-Saudis to invest in real estate funds focused on Makkah and Madinah properties, further opening the market to international investors.

Following the announcement, real estate company shares surged on the Saudi stock exchange. Knowledge Economic City’s share price rose 9.89% to close at SR16.66, Jabal Omar Development Co.’s shares climbed 10% to SR25.85, and Makkah Construction and Development Co. saw its stock rise 9.84% to SR106.