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ubai World Trade Centre
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ubai World Trade Centre
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www.thebig
GCC Healthcare Construction
Market OutlookSe tember 2015
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The GCC healthcare construction market is set to register strong growth in the coming years du
ising population and per capita incomes. The contractor awards for the GCC hospital construc
rojects are expected to increase from US$ 5,850 million in 2014 to US$ 7,300 million in 2015.
Kingdom of Saudi Arabia (KSA) is projected to remain the largest market in the region with the U
nd Qatar expected to be the fastest growing markets for the sector.
TRENDS AND DEVELOPMENTS IN THE GCC HEALTHCARE MARKET
he GCC healthcare sector will continue its strong growth in the coming years. The GCC countries depend heavil
overnment funding to meet healthcare needs, which have embarked on ambitious healthcare infrastructure buil
rograms supported by larger healthcare budgets. According to GCC Healthcare Sector Report by Alpen Capita
pril 2014, the GCC healthcare market is projected to grow at 12 percent per annum to US$ 69.4 billion by 2018.
ccording to Ventures Onsite MENA Projects Database, there are nearly 70 mega hospital projects in the GCC tha
nder construction and each valued at over US$ 100 million. Additionally there are several smaller scale hosrojects under construction. The total number of hospital projects in the GCC in all stages (planned, design, tende
onstruction and under construction) of development is nearly 350.
he contractor awards for the GCC hospital projects are expected to increase from US$ 5,850 million in 2014 to
,300 million in 2015. The Kingdom of Saudi Arabia (KSA) is projected to remain the largest market in the region
he UAE and Qatar are expected to be the fastest growing markets for the sector. Bahrain, Oman, and Kuwait
nticipated to register a significant jump in project completions in 2015 over 2014.
he growth drivers for the GCC hospital construction projects are rapidly growing population and per capita inco
sing life expectancies, high incidence of lifestyle-related diseases, and ambitious medical infrastructure projects byGCC governments.
Medical tourism is emerging as an important trend amongst GCC countries, further fuelling growth of the health
egment. The UAE and Oman are leading the way in tapping into this potential resource for growth with
overnments providing specialised facilities to support the trend. For example, the UAE is building 22 hospitals to
are of half a million medical tourists by 2020.
n addition, the GCC governments are also looking at public private partnership (PPP) models to help reduce ov
nancial risks, enhance the quality and range of services, gain expertise, and prompt innovation. The private sec
hare in the GCC healthcare market is expected to reach 33 percent by 2020.
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Synopsis of outlook for each GCC
country
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UAE
The UAE is one of the most developed markets in the GCC region. Healt
spending in the UAE is expected to reach US$ 10.8 billion by 2015. The
government is also liberalising policies to attract foreign investments, in ord
improvise the healthcare standard and boost the healthcare industry.
healthcare market is expected to grow at a compound annual growth
(CAGR) of around 7 percent from 2015 to 2020. Colliers International in i
2014 healthcare report estimated that the value of the UAE’s private hos
property is expected to reach US$ 2.83 billion and the estimated numb
private beds will reach 5,188 by 2020.
Dubai has witnessed a sudden spurt in private hospitals in recent years. In
the Dubai Health Authority (DHA) issued 301 new licenses and approve
new hospitals in the private sector to cater to the needs of a steadily gro
population. Many of them are under construction and some are operational.
As part of its efforts to encourage medical tourism, the UAE governme
aiming to increase the number of private and public hospitals. The governm
vision of making the country a top destination for medical tourism over
countries such as Germany and US will be one of the future growth strategi
the healthcare sector. For example, Dubai can expect at least half a m
healthcare tourists to be part of the massive influx of visitors arriving fo
Expo 2020. According to the Dubai Health Authority, revenues from me
tourism in Dubai are predicted to increase to US$ 299.5 million in 2016.
The major hospital construction contracts awarded in the UAE in 2015 inc
the following:
Gulf Medical University Hospital in Ajman (US$ 95 million)
Expansion of Zulekha Hospital in Dubai (US$ 54 million)
Al Bustan Specialty Hospital in Mussafah (US$ 30 million)
ADNOC Medical Centre in Khalidiya (US$ 15 million)
The healthcare
market is expected
to grow at a
CAGR of 7 percent
from 2015 to 2020
and revenues from
medical tourism in
Dubai are
predicted to
increase to US$
299.5 million in2016.
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KSA
The KSA is by far the largest healthcare market in the GCC as it accoun
more than half (52.3%) of the region's market. The country’s healthcare ind
has been witnessing significant growth due to rising population, prevalen
lifestyle and infectious diseases, longer life expectancy and govern
initiatives for improving healthcare infrastructure. A 10-year developmen
(2010-2020) is in place which aims to create five specialised hospital hubsRiyadh in the centre, Makkah in the West, Asir in the South, Dammam i
East and Al Jouf in the North. New initiatives have been taken for building
hospitals and primary healthcare centers. Government hospitals constitute
than half of the total number of hospitals in the country. Private hospita
registering rapid growth in regions such as Jeddah, Riyadh, Makkah. Acco
to figures from Alpen Capital, based on data from the International Mon
Fund, WHO and MoH , KSA’s healthcare spend is set to reach a total of
31.5 billion by 2018. KSA’s healthcare industry is slated to grow at a CAG
9.2 percent from 2015 to 2020.
In KSA’s record 2015 US$ 229 billion budget, healthcare and social a
received the second-biggest allocation, after education, amounting to US$
billion, representing 18.6 percent of the total and an increase of 48 percent
2014 budget. In February 2015, the ministry announced that work is underw
complete the construction of 88 centres holding 70 beds and focusing on a
range of specialist treatments. The government’s plans also include
construction of 132 hospitals, five new medical cities providing a total of
beds in hospitals and clinics, and expanding the existing medical citi
Makkah and Riyadh. Moreover, in the coming years, the number of p
hospitals and beds will increase significantly as the demand for healthcare
is rising at a fast pace than the growth in the number of public sector hospita
The major hospital contracts awarded in the KSA in 2015 include 500
Mental Health Hospital in Taif (US$ 98 million) and Mouwasat Hospital
Khobar (US$ 65 million).
Bahrain‘s Economic Vision 2030 lays special emphasis on the health sMillions of dinars will be invested in health centres and hospitals across Ba
over the next 10 years. Bahrain has several healthcare projects lined u
completion in 2015. In addition, the government plans to build a long-term
facility centre, along with a number of other health centres in the northern p
the country, for US$ 36.9 million. One of the major hospital contracts aw
in Bahrain in 2015 is the US$ 105.3 million Mohammed bin Khalifa Spec
Cardiac Hospital in Awali.
KSA’s healthcare
spend is set to
reach a total of
US$ 31.5 billion
by 2018 and is
expected to grow
at a CAGR of 9.2
percent from 2015
to 2020.
Bahrain Millions to be
invested in the
health sector in
the next 10 years.
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Oman
In its 2015 budget, Oman has allocated US$ 4.2 billion or 11.3 percent o
total outlay towards the healthcare sector, which translates into de
healthcare projects expected to be revisited in 2015. Oman is now targ
10,000 new clinics over the next 35 years, in line with the country’s long
strategy for the sector, Health Vision 2050. It also has short-term five-year hdevelopment plans. The main focus for the next five-year plan includes:
Construction of 7 hospitals, 5 health complexes and 27 health centre
Expansion of few of the existing health institutions in all governorat
The Ministry of Health is currently embarking on important health pro
which is estimated to cost a total of US$ 189.6 million. Apart from the cu
projects being undertaken, there are also several projects related to health ce
and other rehabilitation and expansion projects in the pipeline, which amou
US$ 104 million. This is all part of the government’s Eighth Five -Year Plawill place Oman as the next medical hub in the region. The budget o
Ministry of Health will have to almost double by 2020 (US$ 12.9 billion
the US$ 6.47 billion in the Eighth Five-Year Plan), which could see the p
health sector taking on a greater role. The number of hospital beds requir
meet the demand is expected to increase to an estimated 6,300 by 2015.
Allocations to the healthcare industry’s budget increased from US$ 3.9 bill2014 to US$ 4.3 billion in 2015, as Qatar prepares to double the numb
health facilities by 2022. Accordingly, funds have been allocated to comple
Sidra Medical and Research Center; expand facilities at the Hamad Ge
Hospital and the Hamad Medical Corporation (HMC); establish a dedi
hospital for workers; and build new health centers.
Qatar’s National Vision 2030 sets out the government’s goal of improvin
health of the country’s population by developing a world-class and integ
healthcare system.
Qatar’s Public Works Authority (Ashghal) had invited proposals by 11th A
2015 for pre contract professional consultancy services for design and ge
supervision of a new 250-bed hospital adjacent to Qatar University.
enabling works contractors are preparing to submit bids for another As
tender for the National Center for Cancer Care and Research.
The Ministry of
Health’s budget
will have to almost
double by 2020,
which could see
the private health
sector taking on a
greater role.
Qatar Allocations to the
healthcare sector
increased to US$
4.3 billion in 2015,
as Qatar prepares
to double the
number of health
facilities in the
country by 2022.
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KuwaitThe budget forecast for 2015-16 is expected to be close to US$ 6.6 bi
Kuwait nationals are entitled to free medical treatment at government faci
while expats are expected to pay an annual fee to access public healt
facilities. The country is divided into five health regions: Kuwait City, Al J
Jabriya, Reqqa and Farwaniyah. Each offers a general hospital providingoutpatient service and 24-hour emergency services. Kuwait’s governme
responsible for over 80 percent of the total investment in the healthcare s
The private healthcare sector is estimated to take a share of 15-20 percent o
healthcare spending.
However, the supply of the healthcare facilities in the country is yet to matc
population growth. In order to tackle this undersupply of healthcare facilitie
government has initiated the implementation of nine hospital expansion pro
which are expected to add a total of 5,000 beds to the existing capaci
addition to building new hospitals.
Moreover, the government has also announced a number of new projects
constructed across the country, based on the public-private partnership (
model, which is expected to bolster the service quality, while meetin
demand for healthcare facilities.
To tackle theundersupply of
healthcare
facilities, the
government has
initiated the
implementation of
Nine Hospital
Expansion Projects, which
are expected to
add a total of
5,000 beds to the
existing capacity.
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Major GCC Hospital Construction
Projects
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MAJOR HOSPITAL CONSTRUCTION PROJECTS ACROSS THE GCC, SEPTEMBER 2015
Project Name Country Client Est. Value
(US$ Mn)
Status
Military Medical City in Riyadh - Phase 1 Saudi Arabia Ministry of Defence and Aviation, Riyadh 3,800 Construction
Sidra Medical and Research Centre Qatar Qatar Foundation for Education Science
and Community Development
2,400 Construction
King Abdullah Bin Abdulaziz Project For
Development of Security Forces Medical Complexes
Saudi Arabia Ministry of Interior, Riyadh 1,813 Construction
Sultan Qaboos Medical City Complex Oman Ministry of Health, Oman, Muscat National
Development and Investment Company
(Tatweer)
1,500 Planned
Hospital Complex in Barka Oman Ministry of Health and Medical Education,
Iran
1,500 Design
King Abdullah Medical City - Makkah Saudi Arabia King Abdullah Medical City, Makkah,
Ministry of Health
1,400 Tender for
Construction
New Jahra Hospital (NJH) Kuwait Amiri Diwan, Ministry of Public Works
(MPW)
1,266.53 Construction
New Al Ain Hospital UAE Seha - Abu Dhabi Health Services, Abu
Dhabi General Services PJSC (Musanada)
1,089 Construction
Jaber Al Ahmed Al Sabah Hospital Kuwait Ministry of Health, Ministry of Public
Works (MPW)
1,057 Construction
New Medical City and Trauma Mass Casualty
Hospital
Qatar Public Works Authority (Ashghal) 1,000 Design
Farwaniya Hospital Expansion Kuwait Ministry of Health, Kuwait 924.75 Construction
Mafraq Hospital in Abu Dhabi UAE Bumrungrad International, Seha - Abu
Dhabi Health Services, Mafraq Hospital
871 Construction
Al Adan Hospital Expansion Kuwait Ministry of Health, Kuwait 800 Construction
New Sultan Qaboos Hospital in Salalah Oman Ministry of Health, Oman 700 Tender for
Construction
New Hospital Complex for Sheikh Khalifa Medical
City (SKMC)
UAE Seha - Abu Dhabi Health Services 680 Tender for
Construction
urce: Ventures Onsite Projects Database: www.venturesonsite.com
http://www.venturesonsite.com/http://www.venturesonsite.com/http://www.venturesonsite.com/http://www.venturesonsite.com/