Trendy Makeover For Saudi Arabia's Delayed Banking Hub

There might not be any banks yet in the King Abdullah Financial District, but on a sunny afternoon, the once-stalled development in Riyadh is packed with people.

Surrounded by unfinished skyscrapers, Mona Al Humaidi and Munira Al Shumaisi sipped iced coffee in an outdoor lounge, laughing and watching the crowds. "We lack open spaces in Saudi Arabia," 27-year-old Al Shumaisi said. "This kind of atmosphere’s very important for us."

The two Saudi women were among the first to explore THE303, a smattering of pop-up cafes with live music that opened last month in the financial district. Along with a cinema nearby, the venue is bringing early signs of life to the long-struggling development, announced in 2006 as a hub for foreign and local banks.

Plagued by delays, the $10 billion project was dismissed by many as a white elephant - a ghost town that companies were reluctant to move into.

When Crown Prince Mohammed bin Salman launched his economic transformation plan in 2016, he promised to revive and refocus the district. Now, after several years of uncertainty, the construction sites are buzzing again and the project’s almost done.

But instead of being solely finance-oriented, it’s been revamped to blend business with residential and lifestyle destinations - suddenly in heavy demand as the conservative Islamic kingdom loosens up socially.

"The government has quite openly admitted that the district was misconceived as a purely financial and business hub," said Graham Griffiths, a senior analyst in Dubai at Control Risks, a risk consultancy. "Given the significant amount of investment that has already gone into it, it’s natural that they would seek to reorient the project in order to make use of what has already been built."

A spokesperson for the district declined to comment. In an interview in 2017, Crown Prince Mohammed bin Salman said that the project had faltered because it included far too much office space. He pledged to restructure the district and increase the number of residential units.

"The project didn’t fail," the prince said. "It will be the main driver for the city of Riyadh."

The question is whether international companies will move in. So far no banks have opened inside, and many keep their regional headquarters in Dubai.

There’s talk of incentives to entice companies, like making it a special zone with visa exemptions and a direct connection to the airport - and perhaps a lighter social regime. Even the live music played on weekends would have been shocking five years ago in the conservative Islamic country.

Meanwhile, some foreign investors who snubbed Saudi Arabia after the Khashoggi case are coming back. A debut bond sale by state oil giant Saudi Aramco drew a staggering $100 billion in orders.

Goldman Sachs CEO David Solomon made a trip to the kingdom recently, months after the bank pulled executives from a Riyadh investment conference.

But for now, the crowds clogging the area with traffic each weekend are mostly local.

"I wanted to see what everyone’s talking about," said Al Humaidi, 27. She and her friend said they were surprised at how ordinary the place was after hearing so much hype - but added it was a testament to how hungry Saudi youth are for hang-out spots.

"We’re tired of closed places," Al Shumaisi said. "The new generation is very social."