Gaming and Esports Investment in Saudi Arabia: A Worked Venue Example

An illustrative model of a gaming and esports centre in a Saudi city, showing how utilisation, pricing and hardware refresh drive the result.

Saudi Arabia has made gaming and esports a national priority through the National Gaming and Esports Strategy, with large investments by PIF-backed companies and international tournaments hosted in Riyadh. For smaller investors, gaming centres and esports venues in malls and entertainment districts are the visible entry point, alongside game studios and services. The worked example below shows why a venue's result depends less on the headline hourly price than on utilisation and the cost of keeping hardware current.

The situation

An investor plans a gaming and esports centre with 120 high-specification stations in a mall popular with young people, earning hourly play fees, food and drinks, and income from tournaments and private events.

Assumptions (illustrative)

• Stations: 120 gaming PCs and consoles.
• Opening hours: 12 hours per day, 360 days a year.
• Assumed average utilisation: 35 per cent of station-hours.
• Assumed average price: SAR 15 per station-hour.
• Assumed food, beverage, tournament and event income: SAR 900,000 per year.
• Assumed annual costs: rent SAR 900,000, staff SAR 1,100,000, utilities and software licences SAR 450,000, other SAR 250,000; initial capital SAR 3,500,000; hardware refresh SAR 1,800,000 every three years.

Step 1: Available capacity

120 stations multiplied by 12 hours multiplied by 360 days equals 518,400 station-hours.

This is the ceiling. No venue fills it, because weekday mornings and school terms are quiet.

Step 2: Gaming revenue

518,400 multiplied by 35 per cent equals 181,440 hours; multiplied by SAR 15 equals SAR 2,721,600.

Utilisation, not price, is the lever: players compare prices across venues and at home.

Step 3: Total revenue

SAR 2,721,600 plus SAR 900,000 equals SAR 3,621,600.

Food, drinks and events contribute a quarter of revenue and much of the community that keeps players returning.

Step 4: Operating profit

Costs of SAR 900,000 plus SAR 1,100,000 plus SAR 450,000 plus SAR 250,000 equal SAR 2,700,000; SAR 3,621,600 minus SAR 2,700,000 equals SAR 921,600.

This looks healthy until the hardware cycle is counted.

Step 5: After hardware refresh

SAR 1,800,000 divided by 3 equals SAR 600,000 a year; SAR 921,600 minus SAR 600,000 equals SAR 321,600. Payback of the SAR 3,500,000 initial capital: about 10.9 years.

Gamers expect current hardware, so the refresh is an operating cost of the business, not an optional upgrade.

Step 6: Higher utilisation

At 45 per cent: 518,400 multiplied by 45 per cent equals 233,280 hours, worth SAR 3,499,200; total revenue SAR 4,399,200; minus SAR 2,700,000 and SAR 600,000 gives SAR 1,099,200. Payback falls to about 3.2 years.

Ten points of utilisation more than triple the adjusted profit, which is why tournaments, leagues and school holiday programmes matter.

What changes the answer

• Utilisation on weekdays and during school terms, which drives the average.
• Pricing relative to other venues and to memberships offered by competitors.
• Hardware prices and the refresh cycle expected by serious players.
• Rent and service charges in the mall or entertainment district.
• Software and game licensing terms for commercial use.

What the numbers tell you

• Budget the hardware refresh as a recurring cost from day one.
• Invest in events, leagues and community, since they lift utilisation.
• Choose locations with strong youth footfall in the evenings and at weekends.
• Confirm commercial registration, municipal and any entertainment licensing before signing the lease.

Limits of this example

Every figure above is an illustrative assumption used to show the method, not a quote, valuation or market rate. Costs, rates, fees and regulations change and must be confirmed with the relevant authority, lender or supplier before you commit.

If a Vision 2030 programme or market trend is shaping your investment case, Domira can test it against real land, construction costs and local demand in the city you are considering before you commit capital.