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The Ministry of Municipalities and Housing launched the project "Planned Land Development Controls for Housing Support Programs in accordance with Article XIII of the Municipal Real Estate Disposal Regulation" to express an opinion from the Municipal Services, Planning and Urban Development Sector during the period from October 11 to November 10, 2026.
The project aims to organize investment mechanisms in municipal land in exchange for its development or the implementation of housing units for the benefit of the beneficiaries of development housing, in accordance with the regulation of the disposal of municipal real estate issued by Royal Order No. 40152 dated 29/6/1441 AH.
The project granted the Ministry the authority to determine the mechanism of paying the cost of implementing services to the investor in the terms and specifications brochure
Land development through public competition
The project stipulates that the Ministry will offer the development of planned land allocated to the housing support programs after the approval of the Minister, provided that it will be provided with the necessary basic services through an investor through a public competition.
The project also gave the ministry the authority to determine the mechanism of paying the cost of implementing services to the investor in the terms and specifications, whether by enabling him to benefit from a percentage of the developed land for a specified period of time, or through other mechanisms determined by the brochure.
The project explained that the competition in the event of granting the right of use will be on the shortest possible period of time, while obliging the investor to take into account the uses of the land and the approved building and planning systems.
The project stipulated that the percentage of waiver of ownership of the developed land in favor of the investor should not exceed 20% of the total net area of the land after development
Preventing the rate of land waiver from exceeding 20%
The project stipulated that the percentage of waiver of ownership of land developed in favor of the investor should not exceed 20% of the total net area of land after development, with the possibility of exception to this percentage by agreement between the Minister of Municipalities and Housing and the Minister of Finance.
The project stressed that the cedable land does not include land on commercial streets, public utilities or land overlooking coasts and beaches.
It is also required that the competition be on the lowest ownership rate, and that the ministry determines in the terms of the package of waiverable pieces, provided that it is proportionate to the rest of the plots in terms of location, view and street offers, and the investor chooses the pieces he wishes to obtain in a manner that does not conflict with the approved regulatory scheme.
Land emptiness is linked to the stages of completion
The project committed the ministry to determine the mechanism of emptying the land that can be conceded to the investor in detail within the terms and specifications, provided that the emptying is linked to the stages of development of the plan and the actual completion rates.
He also authorized the ministry to require that none of the land be emptied for the benefit of the investor until after the final receipt of the entire plan, and to ensure the implementation of the elements of the project in accordance with the approved procedures.
The terms of reference include technical and financial requirements to ensure the solvency and technical ability of the competitors to compete.
5% bank guarantee of development cost
The project specified the need to include in the conditional booklet the value of the initial bank guarantee required of the competitors, in addition to the final guarantee provided by the winning investor, provided that it is not less than 5% of the estimated cost of project development.
The guarantee shall not be released until the completion of the full implementation of the project elements and to ensure the proper implementation in accordance with the procedures followed.
The project linked the possibility of waiving a percentage of land ownership for the benefit of the investor by implementing the development of the plan and the establishment of housing units for the benefit of the beneficiaries of development housing
Land development in exchange for housing units for beneficiaries of developmental housing
The project linked the possibility of waiving a percentage of land ownership for the benefit of the investor by implementing the development of the plan and establishing housing units for the benefit of the beneficiaries of development housing, provided that the units are handed over to the Ministry for disposal in accordance with the applicable regulations.
The project stipulated that competition should not be offered in this mechanism until a detailed study of the actual cost of the development work and the construction of housing units is prepared, including the costs of infrastructure, basic services and construction costs according to the specified specifications.
The Investment Committee also adopts the waiverable percentage of land ownership.
Secret assessment of land before the competition is introduced
The project stipulates that the Ministry, before the competition, evaluates the land to be developed and the establishment of housing units for the benefit of the beneficiaries of development housing, through an assessor approved by the Saudi Authority for Accredited Evaluators or in coordination with them.
He stressed that the evaluation should be confidential and not disclosed to the competitors, specifying the scope of the required development work, the required housing units, their minimum numbers and the set of waiverable pieces within the conditions brochure.
Competition for the lowest waiver or the largest number of units
The project pointed out that the competition is at the lowest rate of land waiver, or on the largest number of housing units handed over by the investor to the ministry, or according to the combination of the two criteria as determined by the terms and specifications brochure.
In the event that the number of housing units offered in the offers falls below the set minimum, the Ministry shall have the right to cancel the competition without the eligibility of the competitors to claim any compensation.
The project stipulated the emptying of 90% of the land renounced to the investor after the initial receipt of the plan and housing units
Unloading 90% of the land after primary receipt
The project stipulated the emptying of 90% of the land renounced to the investor after the initial receipt of the plan and the residential units, while maintaining 10% until after the final receipt and ensuring the safety of the implementation of all elements of the project.
In the event that the development contract includes the establishment of buildings, the contract must include a provision that provides for the transfer of ownership of the establishments to the Ministry after the expiry of the contract period.
Committees for the analysis of presentations and awarding
The draft provided for the formation of a committee of three members, two of whom represent the Ministry of Municipalities and Housing, and the third Ministry of Finance, headed by a representative of the ministry, provided that his rank is not less than the twelfth or its equivalent, with the appointment of a reserve member for each key member.
The Committee shall analyse the offers made in the public competition, make recommendations to the competent entity for awarding, negotiate with the highest bidders in the specified cases, and estimate or reassess the value of land development.
The draft also provided for the formation of another committee of three or more members of the employees of the Ministry of Municipalities and Housing, headed by an employee whose rank is not less than eight or its equivalent, to open envelopes, announce prices and prepare official records.
Allow the fragmentation of the implementation of services
The project allowed the Ministry to divide the implementation of services in the same scheme through more than one competition, while adhering to the percentages specified in Article XIII of the regulation, except in cases where the exception is allowed according to the decision.
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