MODON Industrial City: What Its Growth Means for You
MODON Industrial City: What Its Growth Means for You
Introduction
MODON, the authority that runs Saudi Arabia’s network of industrial cities, closed 2024 with SAR24 billion in new investment. That’s a 38 percent jump from the year before, and it pushed total investment across its industrial cities past SAR440 billion. If you’re weighing a MODON industrial city against other site options, that pace of growth is worth understanding before you commit. It changes both the opportunity and the timing.
How fast MODON industrial cities are growing
MODON’s own May 2025 announcement lays out the scale plainly. Across its 39 industrial cities, operational industrial, logistics, investment, and data center facilities reached 8,616 in 2024. That’s up 9 percent year over year. Employment inside these zones grew 10 percent to 593,000 jobs, and developed industrial land expanded 7 percent to 219.5 million square meters. The authority signed more than 870 new industrial, logistics, and investment contracts over the year. It also completed 80 projects, at what it reported as a 100 percent delivery rate.
For context on the trajectory: Saudipedia’s profile of MODON put total investment at roughly SAR370 billion across 36 industrial cities as of mid-2023. Two years later, that figure sits at SAR440 billion across 39 cities. A national performance body, the National Center for Performance Measurement of Public Agencies, confirmed one more thing. MODON had fully met its Vision 2030 commitments as of the 2024 reporting period.
What that growth means for choosing a MODON industrial city
None of this means land inside a MODON industrial city is scarce today. Saudipedia’s own account of MODON’s process describes land allocation running in as little as sixteen working days. Construction completion can follow in as few as six. That’s still a fast-moving system.
What it does mean is that the number of investors moving through that system each year is climbing quickly. The contracts and allocations getting claimed are not sitting idle. Starting your site-selection process early in a location’s development cycle, rather than after a zone has filled up with committed tenants, gives you more room to negotiate plot position, phasing, and infrastructure sequencing. Factor that into your timeline. It’s not a reason to rush a decision you haven’t fully scoped yet.
MODON industrial cities are also changing shape
Growth in contract volume is one signal. A second, quieter shift matters just as much for how you might approach a MODON industrial city. MODON is opening parts of its industrial city model to private-sector development, rather than keeping every project on a direct land-lease basis.
In February 2025, MODON and the National Center for Privatization launched a joint Expression of Interest for a logistics zone inside Dammam’s Second Industrial City. The project covers roughly 850,000 square meters. It runs under a design-build-finance-operate-maintain-transfer structure with a 30-year term. Under that model, the private partner finances, designs, and constructs the leasable space, then operates, maintains, and commercializes it. MODON isn’t developing the land itself and leasing raw plots to tenants directly, at least not in this zone.
We haven’t found a confirmed outcome for that specific Expression of Interest, which closed for submissions in March 2025. Nor have I found a public count of how many similar public-private partnership projects have followed it inside MODON’s network since. What the Dammam project does establish is a second path worth asking about. A factory or logistics operator evaluating a MODON industrial city site can now consider leasing built, privately operated space inside a public-private partnership zone. That sits alongside the traditional route: leasing raw industrial land directly from MODON and building on it yourself. Which one fits depends on how much control you want over your own construction timeline, versus how much you’d rather hand off to an operator already running the zone.
The bigger incentive picture around a MODON industrial city site
One more piece belongs in this planning conversation, even though it isn’t a MODON program specifically. In December 2025, Saudi Arabia’s Cabinet approved abolishing the expatriate labor fee for facilities holding an industrial license. The recommendation came from the Council of Economic and Development Affairs. That fee ran SAR300 to SAR800 per worker per month, before a five-year subsidy program covered it from October 2019 through the end of 2025. It had been a recurring cost line for industrial operators employing expatriate staff.
This benefit isn’t tied to MODON at all. It applies Kingdom-wide to any facility holding a valid industrial license, whether that facility sits inside a MODON industrial city, a Royal Commission zone, or elsewhere. But most operations inside a MODON industrial city do hold an industrial license as part of standard setup. That means this cost change stacks on top of whatever land and infrastructure terms MODON itself offers. Build it into your total cost picture as its own line, not folded into MODON’s own terms.
What this means for your project planning
Treat MODON’s growth numbers, its shift toward public-private partnership zones, and Kingdom-wide policy changes like the labor fee decision as three separate inputs to the same site-selection decision, not one bundled story. Growth pace affects your timing. The public-private partnership option affects whether you build or lease built space. The labor fee change affects your operating cost model no matter which MODON industrial city, or which zone within it, you land on. Resolving site selection early is part of front-end engineering design, the same planning phase that settles your project’s other core parameters.
How Temujin approaches MODON industrial city site selection
We treat site selection as a front-end planning exercise, not a real-estate transaction to close quickly. That means checking current land availability and contract activity in the specific MODON industrial city you’re considering. We evaluate whether a public-private partnership zone fits your project better than a direct land lease. And we build your full incentive and cost picture, including policy changes that apply Kingdom-wide, before you commit to a plot.
Frequently asked questions about choosing a MODON industrial city
How many industrial cities does MODON operate?
MODON’s own May 2025 reporting puts the number at 39 industrial cities, with total investment across them exceeding SAR440 billion.
How long does land allocation take in a MODON industrial city?
According to Saudipedia’s account of MODON’s process, land allocation can run in as little as sixteen working days. Construction completion can follow in as few as six.
Can I lease built space in a MODON industrial city instead of developing raw land?
In some zones, yes. MODON has begun structuring parts of its network as public-private partnership projects. A private developer builds and operates leasable space under a long-term contract. The Dammam Second Industrial City logistics zone, launched with the National Center for Privatization in February 2025, is one example.
Does the expatriate labor fee abolition apply specifically to MODON tenants?
No. It applies Kingdom-wide to any facility holding a valid industrial license, following a December 2025 Cabinet decision. Most MODON tenants hold an industrial license as part of standard setup, so the change affects their operating costs. It still isn’t a MODON-specific program.
What should I check before committing to a MODON industrial city site?
Start with current land and contract activity in that specific city. Then weigh whether a public-private partnership zone offers a better fit than direct land lease for your project. Finally, build your full incentive and operating-cost picture, including policy changes that apply regardless of which zone you choose.
Weighing a MODON industrial city against your other site options?
MODON’s growth changes the timing and the options on the table, not just the headline numbers. Get in touch and we will help you work out which MODON industrial city, or which alternative, actually fits your project.
