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Qatar construction shows signs of recovery

16 January 2025

 

In June 2024, Qatar launched the Simaisma project on the coast to the north of Doha in the latest sign of the country’s plan to accelerate its non-hydrocarbons economic growth.

The project covers an area of over eight square kilometres and comprises 16 tourism zones available for development by the private sector, including resorts, a theme park, an 18-hole golf course, residential villas, a yacht marina, restaurants and retail facilities.

The launch ceremony was attended by Qatari Prime Minister and Minister of Foreign Affairs Sheikh Mohammed Bin Abdulrahman Bin Jassim Al-Thani, along with other key figures from the government and the investment, tourism and real estate communities.

The integrated tourism development aligns with the targets set out by the Third National Development Strategy 2024-30, which was launched last year and aims to increase the contribution of non-oil sectors in the Qatari economy.

For the best part of a decade, work on the Fifa World Cup 2022 stadiums and the associated infrastructure sustained the country’s non-hydrocarbons economic growth. However, the construction market found itself at a crossroads after the conclusion of the event.

Market overview

Since 2019, there has been a consistent year-on-year decline in contract awards in Qatar’s construction and transport sectors. The total value was $13.5bn that year, but by 2023, it had fallen to just over $1.2bn.

In 2024, the project contract award figure increased to $1.7bn in a nominally incremental increase, but one that crucially bucks the downward trend in the market in the preceding four years.

The numbers were mainly driven by the construction sector, which recorded contract awards of over $1.2bn, while transport contract awards accounted for about $200m of the overall figure.

Strategic projects worth more than $5bn in the bidding phase are expected to provide renewed impetus to the construction and transportation market and present opportunities to contractors in the near term.

The schemes involved include the Perlita Gardens project at Pearl Qatar, renovation works at Hamad General Hospital, the Al-Shamal airbase zone two, and several roads and infrastructure development schemes under Qatar’s Public Works Authority (Ashghal).

Education uplift

Last year, Qatar also progressed several public infrastructure and building schemes, the most significant of which is the plan to develop 14 schools across the country through a public-private partnership (PPP).

In March, Ashghal and local construction firm Urbacon Trading & Contracting Company signed an estimated $330m agreement to develop the project on a PPP basis.

As per the agreement, five primary schools will be built in the South Al-Wajba, Muaither, Al-Thumama and Al-Meshaf areas. Four preparatory schools will be established in Muaither, Al-Gharrafa, Al-Aziziya and Rawdat Rashed.

Three secondary schools will be developed in Ain Khaled, Muaither and Al-Thumama, and two science and technology schools will be built in the Al-Sakhama and Rawdat Al-Hamama areas.

The other significant contract signed last year was a $243m deal with China Municipal Engineering Central South Design and Research Institute Company to restore old landfills in Mesaieed and Umm Slal in Doha.

These deals were followed by Ashghal’s $76m contract award to the local firm Al-Attiyah Architectural Group Holding for the construction of the Renad Academy and a $35m design consultancy contract for the court complex and court of cassation to the Austrian firm Berger + Parkkinen Architekten.

Transport masterplan

Qatar’s transport sector is largely supported by the Transportation Master Plan for Qatar 2050 (TMPQ) plan, which its Transport Ministry unveiled in 2022. The plan supports 286 projects, including 86 highway schemes, 22 for cargo transportation, 54 public transportation schemes, 21 for pedestrians, 29 cycling schemes and 74 cross-modal and integration projects.

Future highway schemes will entail 37 infrastructure packages totalling 770 kilometres, 22 truck schemes, and 10 infrastructure and facilities schemes. The public transport programme comprises 30 schemes for upgrading the main 540km public transport network.

The masterplan also includes long-distance, metro and regional rail network plans.

Several of the schemes under the plan made some progress in 2024, with Ashghal awarding a number of infrastructure development contracts. These include the award of road improvement works in Doha city to the local firm Al-Mohannadi Group; road and infrastructure works in Birkat Al-Awamer sector 8 to Turkish firm Iris Insaat; and the remaining works in Rawdat Egdaim and Ezghawa P1 to Doha-based Lotus Trading & Contracting Company.

The investments in Qatar’s construction and transport sectors dried up significantly after the 2022 Fifa World Cup, but last year’s upward contract award trend and restrengthening pipeline of pending projects are positive signs for contractors in the country.

MEED's February 2025 special report on Qatar includes:

> GOVERNMENT & ECONOMY: Qatar economy rebounds alongside diplomatic activity 
> BANKING: Qatar banks look to calmer waters in 2025
> POWER & WATER: Facility E award jumpstarts Qatar’s utility projects
> DOWNSTREAM: Qatar chemical projects take a step forward

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Yasir Iqbal

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