Saudi Arabia Green Building Market Assessment, By Product Type [Exterior Products, Interior Products, Building Systems, Construction Materials, Others], By Building Type [Residential, Commercial, Industrial, Institutional, Public Infrastructure], By Appli

Saudi Arabia green building market is projected to witness a CAGR of 10.76% during the forecast period 2025-2032, growing from USD 15.42 billion in 2024 to USD 35.31 billion in 2032. Saudi Arabia green building market is on the verge of undergoing unprecedented growth in line with the kingdom's vision for aggressive sustainable objectives and diversification of its economy in Vision 2030. With its vision to utilize its reliance on oil to an end and cater to environmental problems, green building was a central pillar in a quest for efficiency in energy consumption, resource preservation, and a reduced carbon footprint.

The construction sector, which is one of the key sectors of the Saudi economy, is slowly adopting green technology and materials to keep pace with international standards, such as LEED (Leadership in Energy and Environmental Design) certification. Government policies, both regulatory and incentives, are compelling the trend, encouraging investors and developers to choose green-friendly designs.

Demand growth in green buildings is also supported by growing consumer and corporate knowledge of the cost advantage and environmental sustainability in the long term of green infrastructure. Besides, the rugged climate in the kingdom calls for sophisticated technology, including improved insulation, the use of green energy, and the management of water supplies, increasing market demand even further. They range from investing in smart cities such as NEOM, Saudi Arabia's entrance, to sustainable city formation which utilizes a green building standard.

For instance, in October 2024, Saudi Arabia's Public Investment Fund (PIF), which has diversified its portfolio of green investments to more than USD 19.4 billion, in 91 renewable energy, clean transport, and other projects. The fund put USD 457 million in 18 current projects, of which USD 372 million was in eight green building projects. PIF's second 'Allocation and Impact Report' lists USD 8.5 billion invested from green bonds mobilized over previous years, out of which USD 18.9 billion has been used in 73 projects under development, echoing its support for sustainable development across sectors.

Technological Advancements in Construction Drive the Saudi Arabia Green Building Market Growth

Technology development in the construction industry is a major reason for the growth of Saudi Arabia's green building industry. Sustainable material development, energy-efficient solutions, and smart construction technologies are transforming the industry to enable the development of environmentally sustainable buildings in line with the Kingdom's Vision 2030 goals. Such developments reduce the environmental impact of construction and enhance operational efficiency and long-term cost savings. As an example, the implementation of green concrete, recycling content, and energy-efficient construction is gaining ground, with government initiatives and investment from the private sector.

For instance, in January 2025, the ""NovusCrete"" Consortium was created under a Memorandum of Understanding between the Public Investment Fund (PIF), Saudi Investment Recycling Company (SIRC), NEOM (Design and Construction Sector), SIKA, and ClimateCrete. The community aims to revolutionize concrete production by coming up with environmentally friendly technologies and green materials to significantly minimize the carbon footprint of the construction industry. The initiative is an example of the will of the main stakeholders to force innovation and sustainability in one of the world's most resource-intensive industries, also pushing the growth of Saudi Arabia's green building sector.

Government Policies and Initiatives Force the Growth of the Green Building Market in Saudi Arabia

Saudi Arabia's government is among the foremost drivers of green building, under the ambitious Vision 2030. Stringent energy and sustainability requirements by Saudi Building Code (SBC) policies direct developers towards environmentally friendly development. The Ministry of Municipal and Rural Affairs' Green Building Initiative aims to encourage the use of renewable materials and energy efficiency in building plans. In addition, subsidies and tax relief on green materials induce the private sector to enter this area. Mega-projects such as NEOM, a future city with a focus on green architecture, and a blueprint for innovation, are funded by the Public Investment Fund (PIF).

Environmental codes such as the requirement of environmental impact assessments also guarantee conformity to sustainability targets. These are complemented by international collaboration, e.g., the U.S. Green Building Council, to build local capacity for Leadership in Energy and Environmental Design (LEED) certification. Urbanization, a population of more than 35 million, drives the demand for green infrastructure, and growing ecological awareness among citizens ignites market pressure.

For instance, in October 2024, Saudi Arabia led the Arab world with 2,000 of the region’s 5,000 green building projects, driven by rapid population growth and increasing environmental awareness. The Kingdom’s progress was showcased at the 14th Saudi Green Building Forum in Riyadh. The market is projected to generate USD16.4 billion in 2024, growing at a rate of 12.3% annually, and is expected to reach USD 33 billion by 2030. This reflects Saudi Arabia’s strong commitment to sustainable construction and energy-efficient structures.

Residential Buildings are Expected to Hold the Largest Market Share

Residential real estate has to be the most robust performer in the Saudi real estate market, fueled by the growth of population in the Kingdom, urbanization, and government encouragement towards home ownership. House demand continues to increase, particularly in the main cities of Riyadh, Jeddah, and Dammam, as economic growth and infrastructure development attract nationals and expatriates alike. The government of Saudi Arabia has sought actively to close housing gaps alongside raising the quality of housing supply, and the two actions are components of the wider Saudi Vision 2030 economic diversification vision as well as continuing to raise living standards for inhabitants. An example has been relatively recent times by bringing two new home schemes to the city of Jeddah, Med Sadeem and Khayal Hostel.

For instance, in November 2023, the introduction of two new home projects, Med Sadeem and Khayal Hostel, within the city of Jeddah together provided 757 houses with an emphasis on sustainability. Med Sadeem in the Sadayem suburb measures 136,899 square meters and has 445 villas and townhouses. These developments address not only the increasing demand for green and modern houses but also reflect the Kingdom's commitment to a sustainable urban society. Through the application of sustainable design principles, these developments help preserve the environment without compromising the level of living. Through these developments, Saudi Arabia continues to affirm its interest in the growth of the housing sector with the achievement of the Vision 2030 objectives to provide an active future for its people.

Riyadh Region Holds the Largest Saudi Arabia Green Building Market Size

Riyadh dominates Saudi Arabia's green building market because Riyadh is the regional leader in terms of energy efficiency, water conservation, and reduced carbon footprint in the context of green buildings. Large-scale development initiatives like the Green Riyadh Project, NEOM, and Riyadh Metro are all being supplied with the latest green technology, setting the standard for green city planning. Government requirements for green certifications like LEED and Estidama and developer incentives have also driven the market.

Riyadh's green demands due to urbanization and climatic factors such as warm temperatures and water scarcity have been addressed by needs such as solar energy and smart water technologies. Over 60% of Saudi Arabia's green buildings exist in Riyadh, and thus, Riyadh is leading the nation to a green future. Its leadership in being green makes Saudi Arabia's net-zero vision an achievement, creating economic growth while achieving maximum environmental sustainability.

Future Market Scenario (2025-2032F)

Saudi Arabia's green building industry is set to achieve stunning growth with the Kingdom's Vision 2030 plan, making sustainability and conservation a top priority. The government is actively pushing green building through legislation, tax breaks, and public promotion, and developers are responding by adopting green methods.

With urbanization picking up speed, sustainable and energy-efficient building demand is increasing. Developers find themselves increasingly likely to seek green building certifications such as LEED and Estidama, with an emphasis on energy efficiency, water conservation, and low-carbon footprints to comply with regulations as well as consumers' demands.

The sector is going to be enriched by green technology development in the shape of smart building infrastructure, renewable energy integration, and green materials. Technology is going to drive the efficiency and attractiveness of green buildings and make them comparatively affordable and efficient for developers and end-users alike.

The green building industry is of high interest to private sector investors and foreign multinationals due to the Kingdom’s focus on sustainability. Market growth is expected to be spurred by partnerships and collaborations with global green-building champions, making Saudi Arabia a regional hub for sustainable development.

Key Players Landscape and Outlook

Saudi Arabia's green building sector is also growing aggressively, driven by Vision 2030 and sustainability. SABIC and Saudi Arabian Oil Company are some of the major players that are investing in green programs and driving large sustainable urban development projects. The government's push for LEED and Mostadam certification is creating rising demand for green building. The awareness of energy efficiency and the environment continues to grow, while the market conditions are favorable due to the help of regulatory policies and rising investments in renewable infrastructure and energy. Public-private partnerships will continue driving innovation and take-up in future years.

For instance, in September 2024, China National Building Material Group (CNBM) and Saudi Aramco signed a five-year agreement to collaborate on advanced materials and industrial development. The partnership focuses on establishing manufacturing facilities in Saudi Arabia for wind turbine blades, hydrogen storage tanks, low-carbon building materials, and energy storage solutions. CNBM aims to leverage its expertise in non-metallic materials to support Aramco's green transformation, promoting sustainable development and low-carbon solutions in the building materials industry.