Emaar Properties' Saudi unit, which is developing King Abdullah Economic City, is being forced to delay work as the credit crunch hits the kingdom, according to a report.

Emaar said it was prioritising some developments in the city and delaying others as it seeks to reduce its reliance on banks, the Meed reported late on Friday, citing Hesam Joma, executive director of projects at Emaar, The Economic City.

"We have to adapt," Joma said on the sidelines of a forum in Dubai. "We are aware that on a project of this size you need the banks, but our objective is to minimise our dependence on loans, to balance what we are building with what we are selling."

Emaar Economic City  is spearheading the development of the Jeddah-based King Abdullah Economic City, which it has said could attract over SR100 billion in ($26.67 billion) investment.

The firm is moving forward with mid-range housing targeting professional workers and affordable housing for other workers, but delaying plans for luxury villas, Joma said.-Reuters