Saudi Arabia is rethinking its megadevelopment Neom and the biggest shift may be away from sci-fi urbanism and toward something far more familiar to global real estate players: data centers.
As a year-long review of the kingdom’s flagship megaproject nears completion, officials are preparing to dramatically downscale and redesign Neom, the Financial Times reported.
Plans are emerging to refocus large parts of the development on industrial uses, including digital infrastructure; Neom could be repositioned as a hub for data centers as Crown Prince Mohammed bin Salman pushes to make Saudi Arabia a global force in AI.
Neom sits on the Red Sea, offering access to seawater cooling, abundant land and cheap renewable energy, fundamentals that matter more to hyperscalers than mirrored skyscrapers in the desert.
But the pivot marks a notable shift from the original vision, which pitched Neom as a futuristic urban experiment spanning an area roughly the size of Belgium.
That rethinking is most evident in The Line, the linear city that was once billed as the project’s centerpiece. Originally envisioned as a roughly 170-kilometer wall of glass running from coast to mountains, The Line has already been sharply scaled back and is now set for a more radical redesign. Architects are reworking the concept into a smaller, more conventional development that would repurpose infrastructure already built, rather than extend construction deeper into the desert.
The reset follows years of delays, slow construction and runaway costs. More than $50 billion has been spent so far, but progress has lagged and foreign investment has failed to materialize at the scale Riyadh once expected.
Internal cost estimates for The Line alone have ballooned from about $1.6 trillion in 2021 to as much as $8.8 trillion, straining the Public Investment Fund, Neom’s owner, which logged an $8 billion write-down last year.
Other Neom components are also being trimmed. Trojena, the mountain ski resort once slated to host the 2029 Asian Winter Games, will be downsized and will no longer host the event.
The broader portfolio of PIF megaprojects is under review as Saudi Arabia grapples with tighter liquidity, softer oil prices and the looming costs of Expo 2030 and the 2034 World Cup.
Neom said it is continuously reassessing how to phase projects to align with market demand and long-term value, framing the changes as strategic discipline.
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