immo!nvest – Die Plattform für Standorte und Immobilien

Tag: Megaprojekt

  • Between vision and reality

    Between vision and reality

    Neom and “The Line” in particular were designed to diversify the country’s economy and create a global icon of modern urban development. The city as a 170-kilometre-long, linear megastructure without cars, powered entirely by renewable energy and urban superlatives, promised innovation and worldwide attention. However, it was announced at the end of 2024 that “The Line” would only be realised in a 2.4-kilometre section instead of the originally planned dimensions. Progress to date has been limited to access, infrastructure, initial zones and individual demonstration facilities. Little of the planned construction volume is visible in the desert.

    Financial and structural challenges
    The Saudi oil price is currently no longer sufficient to cover budget requirements and realise megaprojects on the scale originally planned. In the first half of 2025, the Kingdom recorded a budget deficit of around 25 billion US dollars. At the same time, foreign direct investment is stagnating, which is focussing responsibility all the more on the public investment fund PIF, whose reserves and profits have shrunk significantly in recent years. Cost explosions and operational gaps in project management have also cast doubt on the overall project. Internal studies now estimate the total cost of “The Line” at up to USD 8.8 trillion, many times more than ever before assumed.

    Division and redistribution
    The construction freeze not only meant that thousands of jobs were relocated or cancelled, but also that key sub-projects were assigned to new structures. The “Trojena” area, planned as a winter resort and location for the 2029 Asian Winter Games, was placed under the supervision of the Ministry of Sport. The industrial project “Oxagon” is now assigned to the state oil company Aramco. The luxury island “Sindalah” has been under the control of the tourism conglomerate Red Sea Global since 2024. The remaining active sub-projects will reduce Neom’s total share in the Saudi sovereign wealth fund to just six per cent. The massive staff cuts and the consolidation of strategies emphasise the serious changes.

    Consequences for Saudi Arabia’s future strategy
    The redimensioning of the flagship project is jeopardising central pillars of Vision 2030. Neither the planned symbolic leap into a hypermodern society nor economic independence from oil are secured for the foreseeable future. Major events such as the 2029 Asian Winter Games or the 2034 FIFA World Cup are being jeopardised. With its change of course, the country’s leadership is also demonstrating a greater awareness of economic limits and realities. This is a turning point that permanently relativises the claim to global leadership roles in urban planning and innovative state development.

  • Construction of the world’s largest building

    Construction of the world’s largest building

    With a height and width of 400 metres each, the Mukaab will surpass the Empire State Building in New York almost twenty times over. Construction work has now begun in the desert state and the megaproject is due to be completed by 2030. The cube will offer a variety of flats, shops and leisure facilities, strengthening Riyadh’s position as an up-and-coming tourist metropolis. Saudi Arabia is investing 50 billion dollars in the north-west of the capital to create a new urban landscape.

    Virtual reality and artificial intelligence
    The outside of the Mukaab is to be equipped with virtual reality technology to transport visitors to fascinating landscapes. Inside, artificial intelligence will create holograms and simulations that project different places and times at breathtaking scale. The building will thus become a kind of digital adventure park that will attract visitors from all over the world.

    Prestigious projects with challenges
    Mukaab is part of Crown Prince Mohammed bin Salman’s “Vision 2030”, which aims to turn Saudi Arabia into a global tourist destination and business centre. The city of Neom and the linear megaproject “The Line” are also part of this ambitious plan. However, the plans for “The Line” have already been scaled back considerably due to logistical and financial hurdles. Instead of 170 kilometres, the structure will only be 2.4 kilometres long by 2030. It is uncertain whether it will ever reach the planned capacity for 9 million people.

    The Jeddah Tower – a long construction history
    Another mega project, the Jeddah Tower, was originally planned to be the tallest building in the world. After years of delays, the height was reduced from 1600 metres to 1007 metres. Construction began in 2013, but after a five-year break, the project is progressing slowly. The Jeddah Tower could be completed in 2029 at the earliest and become the new record holder.

    Criticism and controversy
    The Mukaab has already caused controversy. The design of the giant cube reminds many of the Kaaba in Mecca, the central shrine of Islam. This similarity is causing criticism in the conservative kingdom, as some citizens consider the construction to be disrespectful.

    It remains to be seen whether the Mukaab project will be realised on time or, like other Saudi megaprojects, run into difficulties. However, the size and ambition of these construction projects show the transformation that Saudi Arabia is undergoing. A transformation that is set to turn the country into a global tourism and business centre and will extend far beyond the oil era.