Riyadh and Jeddah are spearheading a transformative shift in Saudi Arabia’s lifestyle retail sector, reshaping the retail landscape with 394,900 square metres of upcoming lifestyle retail developments that include food and beverage outlets, entertainment options, and vibrant public spaces, all scheduled for completion by 2027, according to Knight Frank’s Riyadh and Jeddah Lifestyle Retail Market Review.
Fueled by Vision 2030
Faisal Durrani, partner – head of Research, MENA, states: “Fueled by the transformative ambitions of Vision 2030, Saudi Arabia’s lifestyle retail market has been undergoing a remarkable evolution since 2021, with Riyadh and Jeddah alone adding over 148,400 square metres of new retail space in the last two years.
“These spaces are no longer just shopping destinations; they have become hubs for entertainment, gastronomy, and social interaction. This transformation is closely aligned with the government’s Vision 2030 initiatives, which aim to enhance the quality of life by driving investment in entertainment, lifestyle, and public realm activities, ultimately creating dynamic urban centers that cater to evolving consumer demands.”
Trends in Riyadh’s lifestyle retail market
Knight Frank’s analysis reveals that casual dining options are present in 52 percent of Riyadh’s developments, with occupancy rates averaging 96 percent. Over the past 24 months, Riyadh witnessed the completion of 73,400 square metres of lifestyle-focused retail developments across five projects, while Jeddah contributed three projects totalling 75,000 square metres.
Jonathan Pagett, partner – Retail Advisory, KSA, explains: “In Riyadh, the existing lifestyle retail supply stands at 452,800 square metres with developments like Boulevard World and Boulevard City being prime examples, incorporating retail and F&B offerings that foster a dynamic relationship between entertainment and retail.”
Market demand and future projections
According to Knight Frank, Riyadh’s average lease rate for lifestyle retail developments is SAR2,360 per square metre, reflecting robust market demand. Food and beverage outlets continue to dominate this sector, comprising a significant portion of the retail typology, accounting for 84 percent of the total space, with casual dining (52 percent) and cafes (20 percent) being the most sought-after categories. Looking ahead, Riyadh is poised to add 232,000 square metres of new supply by 2027, increasing the total number of lifestyle retail developments to 33 by that year.
Pagett added: “Since the rapid kick-off of the F&B landscape in 2019, Riyadh has been an evident contributor to the evolution of the Kingdom’s lifestyle retail scene. The city now hosts 452,800 square metres of F&B-driven lifestyle retail spaces that incorporate parks, gardens, lively public areas, and a diverse range of lifestyle-focused amenities.
“In both Riyadh and Jeddah, we are witnessing how consumer demands have evolved, with purchases becoming a byproduct of shopping mall visitation habits, and consumers continuing to seek unique immersive experiences, mirroring global trends.”
Jeddah’s expanding lifestyle retail supply
In Jeddah, the existing lifestyle retail supply stands at 217,700 square metres, with an additional 75,000 square metres introduced in the past two years, including U Walk Jeddah (60,000 square metres) and La Paz (13,500 square metres), according to Knight Frank. The average lease rates are SAR2,030 per square metre, with F&B occupancy at 76 percent—a testament to the demand for vibrant dining experiences.
Durrani pointed out: “Developments with strong entertainment and lifestyle components continue to command rental premiums as retailers are happy to pay above-average rates to be in locations that offer high levels of footfall.”
By 2027, Jeddah is anticipated to welcome 162,900 square metres of new supply with three new developments, increasing its total number of lifestyle retail developments to 17.
Role of F&B concepts
Food and beverage concepts are playing a pivotal role in redefining the Kingdom’s lifestyle retail landscape and remain the primary drivers of footfall in these developments, according to Knight Frank.
Amar Hussain, associate partner – Research, KSA, concluded: “The younger generation in Saudi Arabia is a driving force behind the evolution of lifestyle retail, with their preference for engaging social spaces and experiential offerings reshaping the sector.
“Their demand for unique dining experiences, entertainment hubs, and integrated lifestyle destinations is setting new standards for the retail landscape across the Kingdom in response to a rapidly growing e-commerce sector.”
