Why a supply pipeline overstates what will be built
A development pipeline counts what has been announced. Net supply is what is left after delays, cancellations and demolitions. Here is how Riyadh's office figures compare.
A development pipeline is everything announced or under construction. Net supply is what actually reaches the market, after delays, cancellations, demolitions and conversions. Reading the first as if it were the second is the most common way to overestimate how fast a tight market will ease.
Why the two numbers diverge
A pipeline figure is a promise. Net supply is what gets delivered and stays in use. Several things leak out in between:
- Slippage. A project announced for one year arrives a year or two late, or in phases.
- Withdrawal and change of use. Schemes get cancelled, put on hold, or switched to another use.
- Demolition. Older buildings taken out of use offset new ones. Net additions are gross completions minus stock removed.
- Double counting. The same tower turns up in each year's "upcoming supply" list until it finally opens.
Treat the gross pipeline as a ceiling on new supply. When a market is close to full, the gap between the two decides whether next year brings any relief.
An illustrative example
The figures are round and made up, to show the mechanics. A city has 500,000 sqm of offices announced for next year. On past form:
| sqm | |
|---|---|
| Announced for next year | 500,000 |
| Slips to the year after (about a third) | −165,000 |
| One scheme cancelled | −50,000 |
| Old stock demolished | −40,000 |
| Net new supply | ≈ 245,000 |
That is under half the headline. An occupier who planned around 500,000 would have read the market badly.
Riyadh's office pipeline
Developers and their owners publish the gross pipeline clearly. The largest confirmed scheme is New Murabba, with 1.4 million sqm of offices in a 25-million-sqm downtown due around 2030 (PIF / New Murabba). KAFD, the prime cluster that is already built, has over 900,000 sqm of offices in 95 buildings (KAFD; PIF). For scale, one listed fund, Riyad REIT, owns 799,463 sqm of net leasable area (Riyad REIT, Dec 2025), and like the other two that is a gross figure.
What nobody publishes is Riyadh's net additions. No ministry, exchange filing or developer gives a city-wide figure for new office space per year. The completion series the big brokers sell is private, so we leave it out.
New Murabba is due around 2030, and some of it will slip like any scheme. KAFD is already two-thirds let and listed landlords report their Riyadh offices at or near full (see Riyadh office market). In that market, whether a year's pipeline delivers most of its headline or a fraction of it is the difference between some relief and none.
For how fast new space gets taken up, see absorption rate.
FAQ
What is a real estate development pipeline? All the space announced, approved or under construction in a market. It counts what is intended, including space that may never be finished.
What does net supply mean? The change in available stock over a period: gross completions minus space lost to demolition, withdrawal or change of use. It is what the market has to absorb.
Why is net supply lower than the pipeline? Projects slip, get cancelled or arrive in phases, reports count the same scheme twice, and demolitions offset new buildings. The pipeline is a ceiling.
What is Riyadh's net office supply for 2026? No public source publishes it. Developers disclose gross schemes (New Murabba's 1.4 million sqm of offices, due around 2030, and KAFD's 900,000+ sqm already built). The net yearly figure only exists in private broker models.
Related
- Riyadh Office Market: What the Public Data Shows
- Absorption rate in real estate, explained
- What "Grade A office" actually means in the Gulf