CEO of Saudi Arabia’s Futuristic City Project Leaves Abruptly

The chief executive of Saudi Arabia’s futuristic planned city Neom abruptly left his role, a major shake-up at the world’s biggest construction project.

Nadhmi al-Nasr, a hard-charging executive who had been chief executive of the kingdom’s marquee development project since 2018, departed in recent days, according to people familiar with the decision and an internal Neom email announcing the change.

The specific reasons for Nasr’s departure couldn’t be learned, but it amounts to a major reshuffling atop Neom, a priority of Saudi Crown Prince Mohammed bin Salman that calls for an arid mountain ski resort, a floating business district and two 106-mile-long skyscrapers taller than the Empire State Building.

Delays, cost overruns and staff turnover have plagued the project. Saudi officials have come to realise they don’t have the money to fund all of the giant projects in the country they once planned, Saudi officials have said.

Executives from the country’s sovereign-wealth fund, the Public Investment Fund — which oversees Neom—are coming in to wield control over the project, the people familiar with the decision said.

Aiman al-Mudaifer , a Public Investment Fund real-estate executive, was named acting CEO, according to an email sent Tuesday to employees from the Neom board. It called the move “a strategic decision of the Board and a natural evolution.”

Nasr didn’t respond to a request for comment.

The crown prince has pushed Neom, a region the size of Massachusetts, as a symbol of the country’s ambitious economic and social transformation.

He envisioned the project as both a sprawling real-estate development and a home for industries that could drive growth and diversify Saudi Arabia’s economy away from dependence on oil. But Neom’s urban planners have struggled to translate the ideas into reality.

Neom has also faced cultural challenges. In recent months, two other top executives at the project have left: Wayne Borg , who ran the project’s media division, and Antoni Vives , who helped lead development of the Line, according to several people familiar with the departures. Both were the subject of a Wall Street Journal article in September that highlighted the checkered pasts and inappropriate workplace behaviour of some Neom executives.

Borg and Vives didn’t respond to requests for comment.

The departure of senior executives could signal a shift in focus by Saudi officials from Neom to other investments across the country. When Neom was announced in 2017, Saudi officials viewed the project as a way to initiate change in the once-conservative Islamic kingdom without moving too quickly in the biggest cities, Riyadh and Jeddah.

Since then, Prince Mohammed’s moves to liberalise his economy have rapidly changed the kingdom as a whole, with a huge increase in women joining the labor force and an influx of foreign investors setting up offices in the capital. Some Neom employees now argue that there is little need for a separate part of the country with its own laws and regulations.

Neom employees also have grappled with turning eye-catching architectural ideas into viable business models.

The Line, the planned pair of skyscrapers marked by a shimmering mirror exterior, has proved particularly challenging. In the past three years the first phase of the project has been repeatedly downsized, from 10 miles to the current plan for 1.5 miles—in what would still be by far the world’s largest building. Foreign investors—once billed as key to the project—have yet to materialise despite numerous attempts to attract outside cash.

Around 100,000 workers live in a pop-up city in Neom, where excavation teams have dug the footprint of the Line and a set of train tracks meant to run beneath it, leaving a more than 60-mile-long gash in the desert.

Nasr came to the job as an accomplished builder. In the 1990s, he expanded a massive oil field for Saudi oil company Aramco, then led construction of a university complex on the edge of the Red Sea in the 2000s.

The challenge of Neom was far greater. When it was announced in 2017, the crown prince wanted the barren piece of desert turned into a shimmering city of one million by 2030, and ultimately nine million people. He put the price tag at $500 billion.

Former executives say the full cost of the Line alone would be well over $2 trillion, far more than the country has to spend on a development.

After Nasr took the reins in 2018, he pushed staff hard. Former employees described his management style as highly aggressive and abrasive, as he frequently yelled and belittled staff in meetings. “I drive everybody like a slave,” Nasr said in one meeting, the Journal previously reported.

Saudi officials have said the country is delaying some projects and canceling others, although it didn’t announce details. The country’s Public Investment Fund has about $1 trillion in assets, but most of that is tied up in investments that would be difficult to unload quickly , including 16% of Aramco, a Saudi telecom company and numerous stakes in private-equity funds.