Following one of the best years for project contract awards in Saudi Arabia, 2024 has so far lived up to expectations, with contracts worth over $8bn awarded in the kingdom’s construction sector in the first two months. The majority of these awards are for work on the gigaprojects programme, which is backed by Saudi sovereign wealth vehicle the Public Investment Fund (PIF). In early January, Italian contractor WeBuild secured a record-breaking $4.7bn contract to construct three dams that will create a lake at the centre of the Trojena mountain resort, located within the Neom gigaproject. The project has an aggressive delivery schedule because the lake – and the surrounding resort and ski slopes – must be ready for the Asian Winter Games in 2029. Many of Saudi Arabia’s projects have event-driven deadlines and will have to be prioritised and delivered on time. For example, in February a joint venture of Belgian contractor Besix and local Albawani was awarded an estimated  $1bn contract to build a new football stadium in Dammam. The facility will host international tournaments such as the 2027 Asian Football Confederation (AFC) Cup and the 2034 Fifa World Cup. Amid subdued activity elsewhere in the broader GCC region, the kingdom’s construction market has become the prime target for local and international contractors, with its thousands of project packages in the pipeline expected to drive project spending and opportunities for many years to come. Regional and international contractors are also expected to continue supporting the construction pipeline, while PPP-structured deals are likely to increase as the country’s burgeoning project expenditures and need for financing outstrip the PIF’s capacity. As the activity ramps up in the country, bigger questions remain: how will Saudi Arabia deliver all of these projects, and does it have a big enough workforce with sufficient expertise to do so? The PIF’s move to establish national champions in the contracting sector, capable of delivering its giant schemes, was the first step in the process, with the investment of $1.3bn in four local construction companies in February last year. This year, the PIF and National Infrastructure Fund (Infra) have created a construction finance programme to improve contractors’ cash flows and help the industry to deliver projects more effectively. The changes under way in the Saudi construction sector are truly seismic. All the available assets in the sector – and more – will need to come together to realise the country’s 2030 project ambitions.  (ICE RIYADH)

Fonte notizia: Meed