The gigaproject slowdown is real and persisting through 1H

Saudi Arabia is shifting its gigaprojects from a “build everything at once” approach to a more phased delivery model, Meed Construction Editor Iqbal Yasir said in a webinar (watch, runtime: 1:20:02). The program is still awarding bns of USD, but the shift is who gets them. Riyadh’s deadline-bound projects and the rail push are absorbing the capital — the desert megaprojects are waiting their turn.

The reprioritization in numbers: By the end of June 2026, a total of USD 92 bn in contracts had been awarded across all five official gigaprojects — Neom, Diriyah Qiddiya, Roshn, and Red Sea Global projects — but only USD 4.5 bn of that came in 1H 2026. The slowdown has been staggered: after peaking at around USD 34 bn in 2023, awards fell 20% in 2024 before dropping a further 48% to USD 14.3 bn in 2025.

The better indicator is which clients are still awarding work. Diriyah, the historic-quarter development on Riyadh’s western edge, drew almost USD 7.2 bn of awards last year, while Neom, long the program’s largest client, drew just USD 70 mn. That hundred-to-one gap maps onto the PIF’s 2026-2030 strategy, approved in April, which concentrates gigaproject spending on delivering what is already under construction rather than launching more.

Two pressures drive this capital discipline. The first is a deliberate reordering toward deadline-bound developments the kingdom lacked when the gigaprojects launched in 2016 — chiefly Expo 2030 and the 2034 World Cup stadiums, which then-investment minister Khalid Al Falih cast last year as the more urgent claim on capital. The second is the regional war. Meed said the conflict has forced the kingdom to divert tens of bns of USD toward military and air-defense replenishment and has left foreign investors more cautious, prompting the PIF to re-examine its spending.

The industry itself is not backing away, even as costs climb. In live polls of the webinar audience, roughly half of attendees said their firms increased their focus on Saudi gigaprojects over the past year, while another 40% held it steady, with only about one in ten pulling back. On costs, about 75% reported input-price increases of up to 25% since the war began, and about 15% pegged the rise above that.

Where money is still moving points contractors in one direction. Construction and transport together account for almost 80% of all gigaproject awards since 2019, and rail has become the most protected line in the recalibration, recast by the Kingdom as economic-security infrastructure now that regional shipping routes have been disrupted. The clearest proof point is Riyadh Metro Line 7, a 65-km, 19-station line from Diriyah Gate to Qiddiya, where Meed expects an imminent award it puts at USD 13-15 bn, potentially the second-largest construction contract ever awarded in the GCC. The Qiddiya high-speed rail line’s main-construction tender is also due later this year.

What changes next is how the work gets funded. Meed expects developers to lean harder on real estate sales, the mechanism Dubai used, and to route more public infrastructure through PPP contracts. The forward pipeline still dwarfs current award levels: construction dominates at roughly USD 145 bn of long-term planned work against USD 51 bn for transport, with smaller amounts across the water, industrial, and power sectors. About USD 192 bn of gigaproject contracts sits somewhere in procurement, much of it stalled on budget decisions, which for contractors makes the pipeline a “question of timing rather than existence.”