Saudi Arabia retail pipeline set to reach 5 million sqm by end-2026

Riyadh's retail supply reached 4.185 million sqm in H1.

Saudi Arabia is on track to expand its retail stock in 2026, with Riyadh expected to reach 5 million sqm of retail space by the end of the year following the delivery of approximately 795,000 sqm of new supply, according to Knight Frank.

The pipeline comes as retail spending continued to shift towards digital channels in the first quarter (Q1) of 2026, with e-commerce transactions rising 41.9% year-on-year (YoY) to US$26.2b (SAR98.4b), whilst spending across official payment channels increased 6.8% to US$113b (SAR425b).

Official payment channel spending reached US$419b (SAR1.57t) in 2025, up from US$378b (SAR1.42t) in 2024.

POS transactions increased 5.8% to US$189b (SAR707.1b), whilst mada e-commerce spending surged 64.7% to US$87b (SAR325.2b).

However, cash withdrawals declined by 2.7% to US$143b (SAR 537.6b).

Riyadh's retail supply reached 4.185 million sqm in the first half (H1) of 2026, supported by the opening of Rawajeh Azal.

Prime regional and super-regional mall rents increased 1.2% YoY to US$707 (SAR2,650) per square metre, whilst occupancy remained stable at 91%.

Vacancy stood at 9%, supported by sustained demand in flagship destinations such as Riyadh Park and Al Nakheel Mall.

Jeddah is also set for further expansion, with an additional 245,000 sqm of retail space expected by the end of 2026, subject to construction progress.

Upcoming projects include the 87,000 sqm Jawharat Mall by Cenomi Centers and the 70,000 sqm The Cove by Ezdihar.

The project is set to include more than 200 shops, restaurants and other dining outlets; a cinema; and a marina overlooking the Formula 1 circuit in Jeddah.

In the Dammam Metropolitan Area (DMA), occupancy increased by two percentage points to 94%, despite a 1.5% decline in average rents to US$586 (SAR2,198) per square metre.

The DMA has 1.42 million sqm of retail space, with another 174,000 sqm expected by 2027.

(US$1 = SAR3.75)