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SAUDI ARABIA - Real Estate & Construction

Ibrahim AshShohail

CEO, AQAR

Bio

Ibrahim Ashshohail, an experienced technology leader with over 10 years of experience, drives innovation as the CEO of AQAR, the award-winning real estate platform in the Central Region. AQAR empowers property owners, brokers, and seekers with cutting-edge solutions, streamlining the Saudi real estate landscape. Prior to joining Aqar platform, his record includes executive and technical management, product management, and extensive experience in various sectors such as financial technologies, e-commerce, collaborative economy, technology platforms, and technical consulting services. He achieved success in his technical founding role at Hala Group, one of the largest financial technology companies in business payments and digital wallets, and in the technical executive management at Hunger Station, the largest food ordering platform in the Kingdom. He also worked at Nimblify to provide consulting services for startups in digital transformation, building internal technical teams, cloud transformation, and software engineering. He holds a bachelor’s degree in Computer Science from King Saud University, and he has many recognized professional certifications and licenses.

"Our goal is ambitious—to list 100% of available real estate for sale or rent in Saudi on AQAR."
TBY talks to Ibrahim AshShohail, CEO of AQAR, about the Saudi Arabian technology sector, the history of the company, and goals for 2024.
Can you provide insights into the evolution and development of the real estate sector in Saudi Arabia over the past years?

In Riyadh’s real estate scene, a notable transformation is underway, driven by changes in construction, promotion, and developer operations. The 2020 pandemic was a turning point, prompting a reevaluation of traditional living spaces. Residents sought alternatives to cramped apartments, leading to a shift in building codes and an emphasis on amenities and community living. Unlike the previous expatriate-centric model, the current trend prioritizes vibrant housing communities for residents, as seen in projects like Al – Fursan Suburb. This departure from the norm is reshaping housing dynamics, offering larger, more affordable options 30-40 minutes away from the city center. These changes address evolving consumer needs, especially among the young workforce seeking diverse housing options. AQAR plays a pivotal role in capitalizing on these transformations, contributing to the dynamic evolution of Riyadh’s real estate sector.

How is AQAR contributing to the growth and transformation of the real estate market in the Kingdom?

AQAR, established in 2014, has been a key player in the real estate market for a decade, witnessing significant transformations in how properties are bought, sold, rented, and marketed. These changes have had a profound impact on our products, offerings, relationships with customers and partners, and interactions with end consumers. At its core, AQAR functions as a listing marketplace where individuals can showcase their properties, generating leads that ultimately lead to transactions on the listed properties. Traditionally, our primary clientele has been real estate brokers, a dynamic market in Saudi Arabia with its unique characteristics. Recent market dynamics, coupled with regulatory changes, have sparked a revolution in the real estate sector, reshaping how brokers operate. Unlike the past, where brokerage in Saudi Arabia and real estate served as accessible side hustles with minimal regulation for almost 50 years, new regulations implemented last year have elevated industry standards. The new real estate brokerage regulations have redefined the requirements for individuals to become brokers, altering documentation, contractual agreements, obligations, responsibilities, educational prerequisites, and licensing. This has resulted in an overall improvement in the quality of operators and services in the market. Simultaneously, developers have raised the standard of their products, creating a misalignment between the capabilities of brokers and the sophistication of the properties being sold. A noteworthy aspect of the Saudi real estate market is the prevalence of land transactions. Land is frequently bought and resold, and in some areas, the market operates akin to a stock market, with properties changing hands multiple times. This contrasts sharply with other countries, highlighting the unique nature of real estate transactions in Saudi Arabia. The ongoing transformation in the market is further evident in the shift from individuals building their own houses to engaging in real estate transactions involving developed properties. With a growing emphasis on marketing different properties, understanding customers and guiding them toward suitable options has become crucial. For AQAR, our role primarily involves serving as a listing platform, extending our services to brokers and developers to showcase units directly for sale or find potential buyers for their clients. While we also have a small segment of direct owner listings, this constitutes a relatively small portion of the overall market. The proliferation of newly developed properties, along with planned or ready units, is rapidly expanding to meet the surging demand. Vision 2030 had a substantial goal of elevating home-ownership rates, and we have made commendable progress in achieving this target., with a goal of reaching 70%, there are discussions about surpassing this number even before the 2030 deadline. A significant effort is underway to attract talent globally, contributing to an increased population in the Kingdom. This demographic shift is accompanied by a rising demand for housing, both in the short term for renters and the long term for those looking to invest and stay in the country for an extended period. Evidently, the demand landscape is diverse, encompassing various unit types and products sought by people. Our primary objective in working with customers is to be the most effective tool for reaching their target audience. For developers, our aim is to minimize both the cost and time spent on marketing their units, allowing them to focus on constructing the best possible units that offer an exceptional experience for customers. Instead of developers actively seeking customers, we position ourselves to bring customers to them. This encapsulates the essence of most of the products we have developed.

How is AQAR strategically adapting its services and platform to cater specifically to the growing demand from international expatriates seeking real estate in Saudi Arabia?

This presents a substantial opportunity for AQAR, one that carries both promise and risk. Our mobile app caters to both Arabic and English speakers, while our website is presently available only in Arabic, a situation we consider temporary. We are on the brink of launching the English version in the coming months. The real challenge, however, lies not in localizing the platform but rather in localizing the broker. Even with an English website, a significant number of our brokers may struggle with comprehension. Thus, our primary challenge is facilitating effective communication for brokers to articulate their capabilities. Our aim is to address this challenge by reshaping how brokers showcase themselves on our platform. This involves highlighting their specialties, language proficiency, preferred areas of operation, and the types of properties they manage. This, we believe, will empower users, even those unfamiliar with the market, to make informed decisions when buying or renting properties. Regarding the second question, we view the increasing number of international users as a tremendous opportunity. Despite our robust presence in the local market with millions of active users each month, this influx represents a new user base we are eager to tap into. Our goal is to deliver an outstanding experience and solidify our position as the go-to platform for those seeking real estate for rent or sale. The challenge here is that the current local market is predominantly driven by resident demands. However, we anticipate a shift in trends, envisioning the emergence of brokerage offices specifically tailored for expatriate experiences. These offices would not only comprehend the needs and preferences of expats but also possess a deep understanding of different cultures, regulations, and international norms. In essence, these brokers would serve as educators, guiding expatriates through the nuances of the Saudi real estate landscape, thereby enhancing their overall experience.

What are some of the segments that you are involved in?

AQAR has chiefly been a residential platform. The issue with commercial units, which is a reason why it has been very hard to penetrate so far, is that occupancy rates are excessively high for anyone to make it in the market. Therefore, if you have a decent commercial unit, it is so easy you do not strike because there is so much demand and not enough supply. I think with the influx of new projects that are done, commercial needs, and even developers who built residential units are building office towers and retail centers. In addition, this will increase the available supply. We will try to change the market dynamic because there is not enough supply in the market today to cover the plans for the country. In addition, that is where the direction is going. We are seeking to become an asset in helping those developers market and promote their new supply.

AQAR has been in operation in the Kingdom for 10 years. How do you maintain your reputation and remain one step ahead of the increasing competition that characterizes the local market?

As the market witnesses a surge in new entrants, both local and international, including brokerage offices, we continue to assert our dominance by being the most extensive listing marketplace. Currently, we command 86% of licensed listings in Saudi Arabia, maintaining our position as the market leader. Our focus is on innovation and creating new products for end users, brokers, and developers. Our goal is ambitious—to list 100% of available real estate for sale or rent in Saudi on AQAR. In 2023, we introduced new products for developers, with plans to expand 10-fold in projects compared to the previous year. To facilitate easy property listings, we have implemented communication services for brokers and launched off-platform marketing services for our customers. Acting as a one-stop-shop for marketing, we have ventured into financing and mortgages, investing in a mortgage brokerage. Our platform now allows users to explore mortgage options seamlessly. In response to market needs, we are introducing a service that enables monthly rent payments, deviating from the standard yearly payment, which can be a challenge for expats. Our upcoming initiative involves renting units from owners and re-leasing them for monthly payments. This strategic approach aligns with our commitment to meeting evolving market demands and maintaining our stronghold in the industry.

What will be the highlight of 2024 for AQAR?

The highlight of 2024 for AQAR will be a two-pronged approach: achieving groundbreaking innovation and unlocking transformative growth. Firstly, we’ll introduce several game-changing features to our platform, such as brokers virtual offices, developers project showcasing services, and seamless integration with mortgage providers. These innovations will enhance the user experience, attract new customer segments, and solidify our position as the leading real estate platform in Saudi Arabia. Secondly, we’ll unlock new revenue streams by diversifying our offerings. This includes launching premium listing packages for developers, introducing targeted advertising solutions, and exploring partnerships with financial institutions to offer value-added services. Through these strategic initiatives, we aim to not only achieve sustainable financial growth but also empower our users with a comprehensive and data-driven real estate ecosystem.

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