(MENAFN- Gulf Times) Saudi Arabian Oil Co is seeking partners to help build commercial properties in a 10,000-home project as the state-owned crude exporter takes a direct role in constructing accommodation for its employees.
The company is contacting developers from the US, Europe and other regions to build and run a mall and hotels in the South Dhahran Home Ownership project, said Michael Heitmann, head of strategic consulting in Middle East and North Africa at Jones Lang LaSalle Inc.
Saudi Aramco is taking a more hands-on approach to building homes for its workers after a strategy of giving out land for individuals to develop wasn't successful, according to Heitmann and Craig Plumb, head of Middle East research for JLL, which is helping the company locate partners.
"Some people were taking the plots and leaving them so you'd end up with roads and street lights but no homes" as people waited for the project to gather momentum, Heitmann said in an interview on Monday in Dubai.
Saudi companies with large numbers of foreign employees tend to house workers in compounds for reasons of security and convenience. The availability of such accommodation can affect a business's ability to compete for staff.
A Saudi Aramco official in Dhahran didn't respond to e-mails seeking comment. A spokesman wasn't able to immediately comment when reached on his mobile.
JLL expects to receive responses soon from international developers approached to help Saudi Aramco develop a 240,000 square-metre (2.6mn square-foot) shopping mall, a souk market, three business hotels and gas stations in the country's Eastern Province, Heitmann said. JLL approached international developers in the US, Germany, the UK, Italy and China, he said.
The first phase of the project, about 3,000 homes, is expected to be completed by 2018, while the rest will be finished by 2024, he said.
Saudi Aramco is also planning to build an industrial city in Al Ahsa on 50 square kilometres of land also in the Eastern Province, which will be focused on attracting energy related companies.
The city is set to include universities, labs and a dry port connecting to the railway as well as homes, offices and some retail, Heitmann said. JLL is advising on the project's master plan and is a management consultant on it, he said.
"It's another way to diversify away from oil," he said. It will take 15 to 20 years to complete the project, which is "geared to energy including solar and other forms."
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