Jeddah, Saudi Arabia: SEDCO Capital, a global Shariah-compliant and ethically led asset management and investment advisory firm (or “the Company”), announced today that it has successfully completed the second capital increase of its flagship SEDCO Capital REIT Fund (or “the Fund”). Following the completion of the additional offering, the total asset value of the Fund reached SAR 2.45 billion, positioning it as one of the largest REITs on the Saudi Exchange.

The Fund received 65,230 subscription requests from 135,852 individual and institutional investors. The successful offering resulted in a 141% oversubscription with the total value of requests amounting to SAR 855.7 million. The units will be allocated to the unitholders within 15 business days from the closing date of the additional offering period in accordance with the allocation mechanism disclosed in the supplementary appendix of the Fund’s terms & conditions.

The Fund’s latest capital increase follows the acquisition of Atelier LaVie, a new entertainment destination in Jeddah’s Al Shati district strategically located along King Abdulaziz Road (Al Malik Road), one of city’s arterial roads. The location of the property is also distinguished by its proximity to main landmarks, such as the waterfront, the Formula 1 racing circuit, and the City Walk. The pedestrian-friendly mixed-use development includes F&B, entertainment, and health and wellness outlets. The property has a Net Leasable Area (NLA) of 21,491 sqm with an estimated Gross Revenue of SAR 39 million annually.  

The acquisition of Atelier LaVie further enhances the Fund’s diversification by increasing its asset allocations across tenant, geographic and sector dimensions, while maintaining its 7% annual distribution target. As a result of the acquisition, the Fund’s portfolio will be geographically distributed 31% in Riyadh, 37% in Jeddah, and 32% in the Eastern Province. In terms of sector, 45% will be focused on entertainment – one of the fastest growing sectors in the Kingdom and a key focus area for Vision 2030 – with 20% Retail, 16% Education, 14% Office, 3% Residential, and 2% Hospitality. Moreover, the acquisition will increase the proportion of multi-tenant properties from 32% to 47%, providing the Fund with more opportunities to review rental prices periodically and further improve returns.

Samer Abu Aker, CEO of SEDCO Capital, said: “The oversubscription of the second capital increase of the SC REIT Fund reflects the trust and confidence investors have in SEDCO Capital's track record of successful real estate investments, the robustness of the properties within our portfolio, as well as the potential attractive returns accessible in the Saudi real estate market, particularly within the entertainment sector.”

Launched in 2018, the SEDCO Capital REIT Fund is a closed-ended, Shariah-compliant real estate investment traded fund (REIT), which aims to achieve quarterly cash distributions to unitholders by investing in high quality income-generating real estate assets across various sectors, including Hospitality, Commercial, Office, Residential, Entertainment and Education, to name a few. Investments are focused on the primary Saudi cities of Jeddah, Riyadh, and Dammam.

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About SEDCO Capital

SEDCO Capital is a global, Shariah-compliant, and ethically led asset management and investment advisory firm. Our investment philosophy is underpinned by three Ps: principles, partnership, and performance. We provide clients with investment solutions through a dynamic asset allocation process across diversified asset classes that deliver strong risk-adjusted returns. By adopting a global view to investing while looking through the lens of our proprietary Prudent Ethical Investment (PEI) approach, an integration of Shariah-compliant and Responsible Investment principles, we provide our clients with unparalleled global access to investments across developed and emerging markets, including Saudi Arabia, in alignment with their investment objectives. In 2014 we proudly became the first Saudi company and the world’s first Shariah-compliant asset manager to become signatory to the UN Principles of Responsible Investment (UNPRI) and we continue to be recognized for our commitment to responsible investments. SEDCO Capital oversees more than $6.3 billion in total assets under management (AUM) and is headquartered in Jeddah with offices in Riyadh, Dubai, London, and Luxembourg.

Find out more at www.sedcocapital.com.

Disclaimer

SEDCO Capital REIT Fund is a closed-ended, Shariah-compliant real estate investment fund. The fund aims to acquire structurally developed real estate assets capable of achieving periodic rental income, and to distribute profits to unitholders of not less than 90% of the fund's net profits. The total value of the fund's assets as of December 31, 2020G is 1,075,204,378 Saudi Riyals. The term of the fund is 99 years from the date of the initial listing. The approval of the CMA was obtained for the initial offering of the fund on 4/12/2017G, and the approval to increase the total asset value of the Fund was obtained on 16/11/2021G. The fund manager is the Saudi Economic and Development Securities Company (SEDCO Capital) and its activities are according to the license granted by the Capital Market Authority No. 11157-37, in dealing, arranging, managing investments, and operating funds, advising and custody in securities. The additional portfolio that the fund manager intends to acquire is a portfolio currently managed by the fund manager through a private real estate investment fund. Prospect investors should read the terms and conditions of the fund and the supplementary appendix for the increase in the total asset value of the fund and what is mentioned regarding the related risks and the change in investment value very carefully before deciding to invest in the fund. This investment is not a deposit with a local bank. The value of the investment can rise or fall, and investors may lose the entire amount and any income generated from it. All investors wishing to invest must reach their decision in consultation with their financial and legal advisors and evaluate all the risks involved in the investment and its suitability for them. No guarantee can be given that the targeted and expected returns will be achieved. In addition, past performance does not guarantee the future performance of the Fund. The investor’s investment in the fund is considered an acknowledgment of having read and accepted the terms and conditions of the fund and the supplementary appendix. The fund manager may invest in the fund from time to time, provided that any investment in the fund is disclosed at the end of each year in the financial disclosure summary. It is possible that the fund manager will subscribe in cash in the additional offering of the fund. Fees apply in the additional offering as mentioned in the supplementary appendix.

Press Contacts:
SEDCO Capital
Maha Abul-Ola
Email: mahaa@sedcocapital.com

Brunswick Group
Jamil Fahmy
Email: sedcocapital@brunswickgroup.com