Saudi Arabia’s Industrial Cities and Technology Zones Authority (MODON) has strengthened the Kingdom’s position as a global logistics platform and a key hub for trade linking three continents, backed by more than SAR553 million ($147.5 million) in new investments during 2025. The spending expanded developed logistics space within industrial cities to more than 16 million square meters, representing annual growth of 35 percent and supporting the objectives of the National Transport and Logistics Strategy. The investment surge underscores MODON’s growing role in developing and managing industrial land and integrated logistics zones across the Kingdom. Established in 2001, the authority currently oversees a network of 36 industrial cities, either operational or under development, in addition to private industrial complexes and cities. It also serves as a strategic enabler for investors by providing advanced infrastructure, smart logistics solutions and ready-built factories, in line with Saudi Vision 2030 goals to increase private-sector participation and diversify the economy. Speaking to Asharq Al-Awsat, logistics expert Nashmi Al-Harbi said MODON has become the operational backbone of Saudi Arabia’s drive to establish itself as a global logistics hub. He noted that the authority attracted SAR24 billion ($6.4 billion) in high-quality investments in 2024, including SAR6 billion ($1.6 billion) in foreign direct investment, strengthening national supply chains and increasing the sector’s contribution to gross domestic product. Alignment With National Strategies MODON’s expansion is closely aligned with the National Transport and Logistics Strategy. The authority is developing industrial and logistics platforms, as well as advanced distribution centers designed to ensure the smooth and flexible flow of goods. The effort has been supported by the National Industrial Development and Logistics Program (NIDLP), which enabled MODON to develop more than 13 million square meters of land, launch new industrial cities in Taif and Asir, and establish a specialized logistics zone in Dammam. NIDLP’s support also included adding more than 600 megawatts of electrical capacity and creating over 700 ready-built factories and industrial products, as well as self-storage facilities, support units and multi-story factory complexes aimed at simplifying business operations for investors and small and medium-sized enterprises. Al-Harbi said the real value of these projects lies in their ability to translate national strategies into tangible infrastructure, linking industrial cities directly with international gateways while reducing both transit times and transportation costs. Integrated Logistics Ecosystem In recent years, MODON has expanded its logistics offerings to include logistics land plots of varying sizes, dedicated distribution centers, third-party logistics (3PL) warehouses, cold-storage facilities, container yards, fully serviced truck parks, self-storage units and open-air storage areas. According to Al-Harbi, MODON now hosts 23 operational logistics centers covering more than 34 million square meters. Their proximity to ports and airports, combined with integrated support services, provides investors with a cost-efficient and highly productive operating environment. Investments Strengthening Supply Chains In 2025, logistics land covering more than one million square meters was allocated across 18 industrial cities, attracting investments exceeding SAR500 million ($133.3 million). Projects included warehouses, distribution centers, truck-service facilities and third-party logistics operations. Among the major investments was a project by Jingdong Property to develop a 40,000-square-meter warehouse complex at MODON Oasis in Jeddah, with investments totaling SAR100 million ($26.7 million). At Jeddah’s Third Industrial City, Kudu Food and Catering established an 18,000-square-meter distribution center valued at SAR50 million ($13.3 million). Saudi Commercial MASCO Co. Ltd. launched a 10,000-square-meter third-party logistics project worth SAR10 million ($2.7 million), while SMSA Express developed a logistics facility in Al-Ahsa’s First Industrial City on a 6,000-square-meter site with investments of SAR10 million. Al-Harbi said manufacturing and food-processing industries are driving demand for logistics services, while rapid growth in e-commerce and pharmaceuticals is increasing the need for specialized distribution centers. Connecting Industrial Cities to Trade Gateways As part of its infrastructure development program, MODON completed a freight rail station at Dammam’s Second Industrial City, linking the logistics zone directly to King Abdulaziz Port and improving cargo flows between industrial centers and maritime gateways. The authority also allocated six fuel stations across industrial cities in Al-Kharj, Tabuk, Madinah, Jeddah and Makkah, covering 65,100 square meters and attracting SAR36.6 million ($9.8 million) in investments. In addition, 14 fully serviced truck yards covering nearly 500,000 square meters were allocated in several industrial cities, including Jeddah, Riyadh and Dammam. MODON also signed 16 logistics contracts worth SAR500 million ($133.3 million) to develop bus-support parking facilities for the Hajj and Umrah seasons within Makkah’s Second Industrial City on a site exceeding 850,000 square meters. To support sustainability goals, the authority launched two electric-vehicle charging stations in Riyadh’s Second Industrial City, with capacity to serve four vehicles. Smart Logistics and Future Growth Al-Harbi said technology has become the main driver of logistics operations, noting SAR8.8 billion ($2.35 billion) in investments across 15 data centers supporting digital transformation and Fourth Industrial Revolution applications. MODON is increasingly adopting automation and smart technologies to improve tracking accuracy and operational efficiency, while seeking to transform 100 factories into global “Factories of the Future.” He identified rapid digitalization and environmental sustainability requirements as the sector’s main challenges, adding that MODON is addressing them through its Green Cities initiative, cybersecurity investments and workforce development programs. Saudi Arabia recorded more than 290 million delivery orders in 2024, underscoring the need for advanced warehouses and efficient distribution networks. Al-Harbi said automated smart warehouses, specialized logistics centers, cold-chain solutions for food and pharmaceuticals, and green logistics services represent some of the Kingdom’s most promising investment opportunities. He added that logistics services have become a critical enabler of Saudi exports by reducing costs and accelerating access to global markets through direct connections to international shipping routes and supply chains. Looking ahead, he expects the logistics sector’s contribution to GDP to rise to 10 percent as Saudi Arabia strengthens its role as a pivotal trade gateway linking Asia, Europe and Africa through expanding logistics and digital infrastructure.
