Savills research highlights rising residential transaction volumes, 98% Grade A office occupancy and continued demand from international businesses
- Approximately 6,944 residential transactions were completed in H1 2026, up 4.9% year-on-year.
- Residential activity recovered to 4,095 transactions in Q2 from 2,849 in Q1.
- Grade A office occupancy remained at 98%, with Zone A prime rents at SAR 2,483 per sq m.
- More than 570,000 sq m of new Grade A office space is scheduled for delivery from late 2026 onwards.
Riyadh’s residential and office markets maintained positive momentum during the first half of 2026, underpinned by economic expansion, population growth, employment creation and continued demand from both end-users and international businesses, according to Savills’ latest research.
Residential transaction volumes increased year-on-year and recovered strongly during Q2, while Grade A office occupancy remained at 98% amid constrained availability. The performance of both sectors reflects Riyadh’s continued evolution as a residential and commercial hub, supported by Vision 2030 initiatives, corporate relocations and ongoing regulatory reforms.
Harry Goodson-Wickes, Head of KSA & Northern Gulf at Savills Middle East said, “Riyadh continues to demonstrate the breadth of its real estate growth story. The recovery in residential activity reflects resilient end-user demand, while the strength of the Grade A office market shows the continued confidence of businesses establishing and expanding their presence in the capital. As new supply is delivered and market accessibility improves, Riyadh is well positioned to sustain its momentum over the medium term.”
RESIDENTIAL TRANSACTIONS RISE AS Q2 ACTIVITY RECOVERS:
Approximately 6,944 residential transactions were completed in H1 2026, compared with 6,620 in H1 2025, representing a 4.9% increase. Activity strengthened in Q2, with 4,095 transactions recorded, up from 2,849 in Q1 and the highest quarterly level over the five quarters from Q2 2025 to Q2 2026.
Residential transaction values totalled SAR 11.25 billion during H1, down 20.7% from SAR 14.18 billion a year earlier. However, values rose from SAR 4.81 billion in Q1 to SAR 6.44 billion in Q2, signalling improving market confidence following subdued conditions in late 2025. Savills said the combination of higher transaction volumes and lower aggregate values reflected activity being concentrated within affordable and mid-market homes and a more balanced pricing environment following the strong appreciation recorded in recent years.
Properties priced below SAR 2 million accounted for approximately 76% of H1 transactions, compared with 74% a year earlier. The SAR 500,000-SAR 1 million segment remained the largest, increasing its share from 30% to 32%. Demand also shifted gradually towards larger homes: the share of 200-299 sq m properties increased from 16% to 23%, while 300-399 sq m homes rose from 17% to 19%.
Andrew Cummings, Head of Residential Agency, Savills Middle East added, “The second-quarter recovery in residential transactions is an encouraging sign of underlying market resilience. Buyers remain focused on affordability and value, but we are also seeing demand become more evenly distributed across different property sizes. Riyadh’s economic growth, expanding population and improving accessibility for international purchasers should continue to support long-term demand.”
GRADE A OFFICE OCCUPANCY HOLDS AT 98%
Riyadh’s office market also maintained strong momentum during Q2 2026, supported by resilient occupier demand and constrained availability. Grade A occupancy remained at 98%, while prime rents in Zone A reached SAR 2,483 per sq m, representing growth of 2% quarter-on-quarter and 6% year-on-year.
New market entrants accounted for 63% of Savills’ completed leasing transactions during the quarter, while relocations represented 37%. Foreign occupiers generated approximately 90% of total enquiries, with particularly strong interest from US-based companies. Demand was concentrated in the 500-1,000 sq m segment, which represented 45.5% of enquiries.
The technology, media and telecommunications sector accounted for 54.5% of office enquiries, followed by banking, financial services and insurance at 27.3%. As of early 2026, more than 700 global companies had established their regional headquarters in Riyadh, exceeding the Vision 2030 target of 500.
Alex Knott, Head of Landlord Agency at Savills Middle East commented, “Demand for high-quality office space remains robust, with new entrants and foreign occupiers continuing to drive leasing activity. Grade A availability is still extremely limited, but the development pipeline expected from late 2026 should gradually expand occupier choice while supporting Riyadh’s long-term position as the Kingdom’s leading commercial centre.”
SUPPLY PIPELINE AND REGULATORY REFORMS:
More than 570,000 sq m of new Grade A office space is scheduled for delivery from late 2026 onwards, including developments at Diriyah Gate, Prime Business Resort and Prince Mohammed bin Salman Nonprofit City (Misk). Savills expects this pipeline to gradually improve office availability while supporting the capital’s continued growth as a regional business destination.
During Q2, Saudi Arabia introduced executive regulations governing foreign ownership of real estate and launched a digital property ownership platform. Savills expects the reforms to improve transparency, broaden the long-term buyer and investor base and reinforce confidence across the real estate market. The Kingdom’s rent stabilisation framework is also providing greater pricing transparency and cost certainty for residential tenants and commercial occupiers.
OUTLOOK:
Riyadh’s residential and office markets are expected to remain supported by continued population growth, employment creation, corporate expansion and the ongoing implementation of Vision 2030. Oxford Economics forecasts Riyadh’s economy to grow by 8.4% in 2026. While residential price growth is likely to moderate from the exceptional levels recorded in recent years and the office pipeline is expected to gradually improve availability, Savills anticipates that healthy end-user demand, sustained occupier requirements and continued infrastructure investment will underpin resilient market performance over the medium term.
About Savills Middle East:
Savills plc is a global real estate services provider listed on the London Stock Exchange. With a presence in the Middle East for over 40 years, Savills offers an extensive range of specialist advisory, management and transactional services across the United Arab Emirates, Oman, Bahrain, Egypt, and Saudi Arabia. Expertise includes property management, residential and commercial agency services, property and business assets valuation, and investment and development advisory. Originally founded in the UK in 1855, Savills has an international network of over 700 offices and associates employing over 40,000 people across the Americas, UK, Europe, Asia Pacific, Africa, and the Middle East.
