Quick Answer: Office space in Riyadh typically costs SAR 800 to SAR 3,500 per square meter per year, depending on location, building grade, and lease terms. KAFD commands the highest rates, while emerging districts like Al Sahafa offer 30-40% savings.
Office Rental Rates by District (2026)
| District | Grade | Typical Range (SAR/sqm/year) | Notes |
|---|---|---|---|
| KAFD | A | 2,000 – 3,500 | Premium; limited availability |
| Olaya (prime towers) | A- | 1,400 – 2,200 | Established CBD |
| Olaya (secondary) | B+ | 900 – 1,400 | Older buildings |
| Diplomatic Quarter | A- | 1,200 – 1,800 | Prestige address |
| Al Sahafa | A- | 1,000 – 1,500 | Value option, newer buildings |
| Al Nakheel | B+ | 800 – 1,200 | Budget-friendly |
| King Fahd Road | A-/B+ | 1,200 – 1,800 | Varies by building |
Note: Rates are indicative and subject to market conditions. Actual rates depend on specific building, floor, and negotiation.
What's Included in These Rates?
Base rent typically includes:
- Use of office space
- Building access
- Basic building services
Usually charged separately:
- Service charges: 15-25% on top of base rent
- Parking: Often included; executive spaces may cost extra
- Fit-out: Tenant responsibility in most cases
Example Calculation
Base rent: SAR 1,500/sqm/year
Service charge (20%): SAR 300/sqm/year
Total occupancy cost: SAR 1,800/sqm/year
For a 500 sqm office: SAR 900,000/year or SAR 75,000/month
Factors That Affect Office Rent
Location
KAFD commands a 40-60% premium over secondary locations. Proximity to metro stations and main roads affects pricing.
Building Grade
- Grade A: Modern towers, international specifications
- Grade B+: Good quality, may be older
- Grade B: Functional space, basic finishes
Floor Level
Higher floors typically cost more, especially with views.
Lease Term
Longer leases (5-10 years) may secure 5-15% discounts.
Market Timing
Current market: High demand, especially in KAFD. Limited negotiation room in prime locations.
Related Reading:
For a practical guide comparing serviced, fitted, and shell offices in Riyadh—including office types, areas, and lease terms—read our Office Space in Riyadh: A Practical Guide for Companies (2026).
For a comprehensive overview of the Saudi commercial real estate market and broader leasing context, see our Saudi Arabia Commercial Real Estate Market (2026): Riyadh Leasing Outlook.
Hidden Costs to Budget For
| Cost | Typical Range | Notes |
|---|---|---|
| Service charges | 15-25% of base rent | Mandatory |
| Security deposit | 1-3 months rent | Refundable |
| Fit-out | SAR 800-2,500/sqm | Varies by finish level |
| Legal/documentation | SAR 5,000-20,000 | Lease review, registration |
How to Get Better Rates
1. Consider Secondary Locations
Al Sahafa and emerging districts offer modern buildings at 30-40% below KAFD rates.
2. Negotiate on Total Cost
Don't just focus on headline rent. Negotiate:
- Service charge caps
- Rent-free fit-out period (1-3 months typical)
- Landlord contribution to fit-out
- Parking allocation
3. Commit to Longer Terms
5-10 year commitments can secure meaningful discounts.
4. Work with a Tenant Advisor
Market knowledge and landlord relationships help identify fair pricing and negotiate effectively.
Office Size Guide
| Company Size | Typical Requirement | Monthly Cost Range |
|---|---|---|
| Startup (5-10 people) | 100-200 sqm | SAR 12,000-35,000 |
| SME (20-50 people) | 300-700 sqm | SAR 35,000-100,000 |
| Corporate (50-100 people) | 800-1,500 sqm | SAR 100,000-250,000 |
| Large enterprise (100+) | 1,500+ sqm | SAR 250,000+ |
Note: Based on mid-market rates including service charges. KAFD would be 40-60% higher.
Payment Structure in Saudi Arabia
Unlike some markets with monthly payments, Saudi office leases typically require:
- Annual payment: Full year upfront (most common)
- Semi-annual: Two payments per year (often available)
- Quarterly/Monthly: Rare for traditional leases
Security deposit: 1-3 months, returned at lease end.
FAQ: Office Costs in Riyadh
What is the cheapest area for office space in Riyadh?
Al Nakheel and parts of Al Malaz offer lower rates (SAR 800-1,200/sqm). However, building quality may be limited.
Is KAFD worth the premium?
For financial institutions and consulting firms where address matters to clients, yes. For back-office operations, secondary locations offer better value.
Do office rents include utilities?
Service charges usually cover common area utilities. Your office electricity is typically metered separately.
Can I negotiate office rent in Riyadh?
Yes, though negotiation room depends on building vacancy and your tenant profile.
How often does rent increase?
Typical escalations are 3-5% annually or at renewal.
How SAT Real Estate Services Helps
SAT is a tenant-focused commercial real estate advisory firm headquartered in Riyadh. We help companies understand true market rates and negotiate effectively.
- Current market data and comparable transactions
- Building-by-building analysis
- Negotiation support to reduce total occupancy cost
