Saudi Arabia has opened the real estate market in Mecca to foreign investors as part of its efforts to diversify the economy and attract external investments. The city is undergoing extensive redevelopment, with older neighborhoods being cleared to make way for modern residential and hotel towers near the Masjid al-Haram.
The government has allowed foreign Muslim investors to legally purchase property, a move that could add billions of dollars to the market, in addition to roughly $60 billion worth of projects currently under construction or in the planning stages.
The $27 billion Masar project is being led by Umm Al Qura for Development and Construction and includes thousands of residential units, hotel rooms, and a shopping center. The company’s stock has risen 17% since its listing, while the Public Investment Fund retains a significant stake.
This direction comes after reviews of some mega-projects such as NEOM, with Riyadh shifting its focus toward tourism, finance, and artificial intelligence. The kingdom aims to attract $100 billion annually in foreign investment by 2030.
Land in Mecca near the Masjid al-Haram is among the most expensive in the world, with hotel rooms reaching up to $10,000 per night. An Indonesian sovereign wealth fund is planning to invest more than $1 billion.
However, experts warn that rapid expansion could affect the city’s historic character and increase the costs of Hajj and Umrah, stressing the need to balance economic returns with preserving the city’s spiritual significance.
