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Nov 24 2010

Shuaa to fully deploy its SR2bn fund by end-2011

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SHUAA Capital

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Invests SR160m to develop budget hotel in Jeddah
 Shuaa Capital Saudi Arabia, a unit of Dubai-based Shuaa Capital , has invested 160 million Saudi riyals to develop a budget business hotel in Jeddah which will be managed by Rotana Hotel, a hotel management company.

In a statement to Dubai Financial Market, Shuaa said it made investments through its SR 2-billion Shuaa Saudi Hospitality Fund I - marking the second investments by the fund in the Kingdom.

Shuaa also signed a Memorandum of Understanding (MoU) with Youssef Ismail Youssef, the land owner.

The land will be developed into 254-room business hotel. The hotel will have a total built-up area of approximately 13,000 square metres.

Average hotel occupancy rates in Jeddah stood at 77 per cent in 2009, and the number of travelers to Jeddah International Airport increased by 5.1 per cent per annum between 2003 and 2009, from 13.1 million in 2003 to 17.8 million visitors in 2009. King Abdulaziz International Airport, which serves as the entry point for pilgrims visiting the Holy Cities of Makkah and Madinah, will be renovated with the aim of handling 30 million passengers by the year 2012.

Sameer Al Ansari, Chief Executive Officer of Shuaa Capital , said: "We are hopeful to deploy the Fund's commitments entirely by the end of 2011, given the success of the product and the strong fundamentals of the Saudi economy, the consistent growth rates in travel and tourism, and the fast growing need for new hotel developments."

Omar Al Jaroudi, CEO of Shuaa Capital Saudi Arabia, said: "The Shuaa Saudi Hospitality Fund is at the core of our private equity and real estate platform. We are in advanced discussions with potential strategic partners envisioning to join forces with the Shuaa Saudi Hospitality Fund, and anticipate to announce strategic alliances over the coming months. These alliances will allow us to meet an accelerated rollout plan, while delivering superior-quality products for our investors and ultimately a superior experience for the hotel guests."

Selim El Zyr, President and CEO of Rotana, said there is a shortage of modern hotels in the Kingdom and demand for available hotel rooms significantly outstrips supply to the background of a booming travel and tourism industry. "Our objective is to develop and manage hotel properties to the best international standards which will cater to the needs of the local, regional, and international traveler while keeping in mind the specificities of Saudi society."

© Emirates 24|7 2010

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