Saudi Arabia plans major redesign and downsizing of Neom
A review of the Neom megaproject recommends a significant scaling back, with The Line to be redesigned and a pivot toward data centres and industrial uses.
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By Torontoer Staff
Saudi Crown Prince Mohammed bin Salman is moving to scale back and redesign Neom, the kingdom’s flagship megaproject, after years of delays and budget overruns. A year-long review is expected to recommend a substantially smaller plan focused on industrial uses, including data centres, and to repurpose existing infrastructure.
The changes would redraw plans for The Line, the linear city at the heart of Neom, and shrink other headline projects such as the Trojena ski resort. The review is due to conclude by the end of the first quarter or shortly after, people briefed on the matter said.
What the redesign would change
People close to the review said Prince Mohammed now envisages Neom as "far smaller" than the original concept. Architects are working on a more modest version of The Line that repurposes infrastructure already built over the past few years, rather than continuing the original, far more ambitious plan.
- The Line, originally proposed to extend roughly 170 kilometres, will be radically scaled back and redesigned to use existing infrastructure.
- Trojena, the mountain ski resort, will be downsized and will no longer host the Asian Winter Games in 2029.
- Oxagon and other coastal industrial zones are being refocused toward logistics and heavy industry.
- A new priority is making Neom a hub for data centres and AI-related infrastructure, taking advantage of coastal seawater cooling and renewable energy.
It shows that the system has a capacity to adjust its goals.
person briefed on the review
Why the pivot is happening
Riyadh is recalibrating spending as liquidity tightens after a decade of heavy investment and with subdued oil prices. The Public Investment Fund, which owns Neom and is chaired by Prince Mohammed, is under pressure to deliver returns and prioritise projects with clearer, near-term economic impact.
Leadership changes inside Neom have also driven the reassessment. The longtime chief executive left abruptly in November 2024 and his successor launched a comprehensive review of scope and priorities. Officials have cited the need to align the project with strategic objectives, market readiness and sustainable economic impact.
The new emphasis: data centres and industrial scale
Sources say a major practical reason for the shift is demand for data centre capacity, tied to Saudi ambitions to become a regional AI leader. Neom’s coastal location offers seawater cooling and access to renewable energy, features that make it attractive for server farms and related infrastructure.
Neom signalled the pivot in a statement, saying the development is "always looking at how to phase and prioritise our initiatives so that they align with national objectives and create long-term value," and that it is focused on attracting investors in data and AI sectors.
As a development that’s meant to span generations, Neom is advancing projects in line with strategic priorities, market readiness and sustainable economic impact.
Neom statement
Implications for timelines and contractors
Neom has been a major source of contracts for consultants, architects and construction companies, with tens of billions of dollars invested since the 2017 launch. A scaled-back approach will change procurement timelines and the mix of contractors needed, and may delay or cancel some high-profile elements.
The kingdom also faces hard deadlines for international events, including Expo 2030 and the 2034 World Cup, which place additional pressure on how resources are allocated across projects.
Next steps and what to watch
The review is expected to wrap up by the end of the first quarter or shortly after. Watch for a formal outline of the revised scope, timelines and investment priorities from Neom and the Public Investment Fund. Investors and contractors will be looking for clarity on which projects proceed, which are paused, and what procurement will look like under the new plan.
If implemented, the redesign will mark a move away from the original, highly ambitious masterplan toward a narrower set of commercially driven objectives, centred on industrial capacity and digital infrastructure.
Neom remains a long-term project covering an area roughly the size of Belgium. The scope and pace of its next phase will be decisive for Saudi Arabia’s broader plans to diversify its economy and build a regional technology hub.
NeomSaudi ArabiaThe LinePublic Investment FundAI
