Fund to Drive Jeddah Logistics City Development

The first investment fund for logistics services has been launched to develop a logistics city in Jeddah, western Saudi Arabia, with investments totaling SR650 million (US$173.44 million).

The project aims to enhance the supply of land and logistics services and bolster Jeddah’s position as a regional logistics hub, according to Maher Bilal, chairman of the board of directors of Missan for Real Estate Development Co., who spoke to Al-Eqtisadiah.

Development plans

Bilal said the project coincides with the signing of two agreements with strategic partners — Ansab General Contracting Co. and financial firm FAAD Partners — to launch the “Missan Logistics Opportunity Fund.”

He explained that the project will be built on a 320,000-sq.-meter plot north of Jeddah in Al-Kawthar District, south of Al-Hamdaniya. Development is expected to be completed within 18 months, after which the developed land will be offered for sale according to a timeline determined by market studies. The project will meet around 5 percent of market demand.

Bilal said the project’s location was chosen in response to the rapid growth in logistics activities in Jeddah and the rising demand for warehouses and related services.

He added that warehouse occupancy in Jeddah reached 97 percent in 2024, out of a total supply of approximately 18 million sq. meters, with an annual growth rate of 4.8 percent, reflecting continued expansion in demand for logistics space.

The chairman said the project will add capacity equivalent to 5 percent of the Jeddah warehouse market’s needs and is expected to help narrow the gap between supply and demand. The project is targeted for launch at the end of 2027, when demand is expected to approach the full available supply.

Bilal added that the expansion of Jeddah’s ports and their strengthening role as a logistics hub underscore the need to develop new projects that can accommodate the anticipated growth in demand for warehouses and logistics services.

Construction timeline

Mohammed Al-Khadhib, managing director of Ansab Contracting Co., told Al-Eqtisadiah that the company is undertaking the infrastructure work for the project’s three phases — A, B, and C — as the contractor responsible for the development work.

He explained that work will begin shortly, noting that the company has already started preparing the site, setting up the field office, procuring materials, and constructing roads.

Al-Khadhib added that the aim is to complete the main infrastructure works within 12 to 18 months, while some internal works will continue alongside the project’s implementation, paving the way for the development of the logistics city according to the planned timeline.

Jeddah Port expands logistics network

Last week, Saudi Arabia inaugurated the world’s largest truck terminal at Jeddah Islamic Port, covering an area of 1 million sq. meters.

On the same day, the Saudi Ports Authority signed seven agreements with companies, representing investments exceeding SR1 billion (US$270 million), on the sidelines of the terminal’s launch.

The convoy area, inaugurated by Minister of Transport and Logistics Saleh Al-Jasser, has been designated as the first entry point for trucks heading to Jeddah Port before proceeding to Gates 4–9. This will increase operational capacity, reduce congestion, and improve traffic flow.

Al-Jasser told Al-Eqtisadiah at the time that the new truck area at the port enhances the efficiency of logistics operations and trade, emphasizing that the logistics sector has adapted to shifts in global shipping patterns by redirecting trade to the western coast.

Regarding logistics zones, he said that with the signing of the new agreements, the total number of logistics zones within Saudi ports has risen to 34, with investments totaling SR15 billion (US$4 billion), fully funded by the private sector.

The agreements included the establishment of a logistics center to support commercial activities and maritime services, and another integrated center to support import, export, and logistics operations.

He highlighted the expansion of the Maersk logistics zone at Jeddah Port as one of the company’s most prominent projects and Maersk’s largest logistics zone globally.

Notable projects also include the signing of agreements by China’s GD Logistics for its largest investment outside China through two projects at Jeddah Port and the Al-Khumrah area, in addition to contracts signed by five leading national companies to establish new logistics zones.