Latest news with #business confidence
Zawya
6 days ago
- Business
- Zawya
Savills: Riyadh Office Market holds firm as rents and occupier demand continue to rise
Riyadh's office market continued to perform strongly in Q2 2025, underpinned by a stable economic outlook, high business confidence, and growing interest from international occupiers, according to the latest research from Savills. The Kingdom's economy is forecast to expand by 3.5% in 2025, driven by a 4.9% rise in the non-oil sector, a clear indicator of the ongoing success of Saudi Arabia's diversification agenda. Business sentiment remained upbeat, with the Purchasing Managers Index (PMI) climbing to 57.2 in June, its highest reading since May 2011, signalling strong private sector activity and employment growth. Foreign direct investment also continued on an upward trajectory, reaching SAR 22.2 billion in Q1 2025, up from SAR 15.5 billion during the same period last year. Within the office market, Grade A occupancy stood firm at 98%, reflecting sustained tenant demand amidst a limited supply pipeline. Average rents rose slightly by 0.75% on a quarterly basis but recorded a 10% increase year-on-year. Zone C, home to emerging hubs such as Riyadh Front. Digital City, and Laysen Valley, led annual rental growth at 15%, while Zone A, which includes prime locations such as Olaya, KAFD, and Kingdom Centre, followed closely with nearly 11%. This highlights the continued appeal for both well-established commercial districts and newer, strategically located developments. Chris Chambers, Head of Transactional Services in KSA, commented: 'We're seeing strong expansion-driven activity across sectors, particularly within banking, financial services and insurance (BFSI) accounting for 50% of transactions this quarter. Legal and pharmaceutical firms each contributed a further 25% underscoring the depth and diversity of demand. Notably, leasing interest is increasingly shifting towards larger spaces, with half of all enquiries targeting units above 1,000 sq m.' Multinational interest in Riyadh remains high. By mid-2025, over 660 global companies had been licensed to establish regional headquarters in the city, already surpassing the Vision 2030 target of 500. Notable new entrants in Q2 include BNY Mellon, ASPEN, Globant, and London Business School. Enquiry data from Savills shows that 46% of leasing interest this quarter originated from the US and UK, reflecting strong global confidence in the Saudi capital. Sector-wise, the highest levels of leasing enquiries came from banking and financial services, technology, media and telecoms (TMT), and engineering and manufacturing, highlighting Riyadh's broadening commercial base and appeal to knowledge-driven industries. The capital's infrastructure push also continues to support its commercial growth. The Riyadh Metro saw over 25 million passengers in Q1 2025, and the addition of new stations is expected to further enhance accessibility to key areas such as the King Abdullah Financial District (KAFD) and Olaya. Looking ahead, while rental growth is likely to remain firm in the near term due to ongoing demand and limited supply, the pressure is expected to ease slightly towards the end of 2026, with more than 900,000 sq m of new Grade A stock scheduled to be delivered through major developments such as Diriyah Gate and Prince Mohammed bin Salman Nonprofit City (Misk). For further insights and detailed analysis, download the full Riyadh Office Market in Minutes Q2 2025 report from here. About Savills Middle East: Savills plc is a global real estate services provider listed on the London Stock Exchange. With a presence in the Middle East for over 40 years, Savills offers an extensive range of specialist advisory, management and transactional services across the United Arab Emirates, Oman, Bahrain, Egypt, and Saudi Arabia. Expertise includes property management, residential and commercial agency services, property and business assets valuation, and investment and development advisory. Originally founded in the UK in 1855, Savills has an international network of over 700 offices and associates employing over 40,000 people across the Americas, UK, Europe, Asia Pacific, Africa, and the Middle East.
Reuters
6 days ago
- Business
- Reuters
French private sector activity contracts again in July, PMI shows
PARIS, July 24 (Reuters) - France's private sector activity shrank for an 11th straight month in July as political uncertainty weighed on business confidence in the euro zone's second-biggest economy, according to data from S&P Global published on Thursday. The HCOB Flash France Composite PMI Output Index rose to an 11-month high of 49.6 points in July from 49.2 in June, but remained below the 50.0 threshold that separates growth from contraction. A Reuters poll had forecast a rise to 49.3 points. The July services sector flash PMI edged up to 49.7 from 49.6 in June, while the July flash manufacturing sector PMI also rose to 48.4 from 48.1 in June. Demand for French goods and services also weakened further, with new orders falling at the fastest rate since February. Business confidence deteriorated significantly, reaching its lowest level since November, as companies expressed concerns over domestic political uncertainty given opposition to French Prime Minister Francois Bayrou's budget. Trade unions and opposition political parties have voiced discontent over Bayrou's proposal to scrap two public holidays and freeze most public spending as part of a 43.8 billion euro ($51.36 billion) budget squeeze. "While momentum has been trending upward since the beginning of the year, the index remains below the critical 50-point threshold. This continues to signal a deterioration in economic conditions, albeit one that is only marginal," said Jonas Feldhusen, Hamburg Commercial Bank junior economist. "Should an agreement on the austerity package be reached, it would reduce disposable income for many households - posing clear downside risks for domestic demand and especially for the services sector. Conversely, failure to reach a budget deal could further escalate political uncertainty," he added. ($1 = 0.8529 euros)
Bloomberg
7 days ago
- Business
- Bloomberg
Hungary's GKI Business Confidence Index Plunges to Five-Year Low
Hungary's business confidence index plunged to its lowest level in almost five years, in another sign that the economy could be on the brink of another recession. The gauge fell 2.1 points to -14.8 in July, the lowest level since June 2020, according to the GKI research institute, which compiles the data. Along with deeply pessimistic consumers, the overall economic confidence level slipped to -19.2, the worst reading since the end of 2022.
