Saudi Real Estate Co. to raise $426.4mln to finance Qiddiya, Roshan projects

RIYADH: Saudi Real Estate Co. (Al Akaria) plans to raise SR1.6 billion ($426.4 million) via priority rights issue to finance projects and plans including Qiddiya, Roshan and other major projects related to Vision 2030, CEO Ibrahim Al-Alwan confirmed in an interview on Tuesday.

This is a great opportunity to link the expected growth of our performance with the pace of major projects, and thus the need to increase capital, he said.

Al Akaria announced on Tuesday in a filing on Tadawul, it is considering issuing priority rights to finance its future projects, and the company’s board decided on Monday to present the proposal at an extraordinary general assembly.

The board also approved the appointment of NCB Capital as financial adviser.

The aim is to finance and implement Al Akaria’s future plans and projects and expand its various activities, Al-Alwan told Al Arabiya.

He said the great momentum in the Saudi real estate market provides an opportunity for the oldest real estate company in the Kingdom to keep pace with the growth of Riyadh, which is witnessing a rapid infrastructure expansion.

Al Akaria CEO also pointed out that the company intends to restore and revive some of its previous projects, and build again in distinctive locations in Riyadh. There are many new projects under study, he said.

As residential projects in the Kingdom are focusing on the quality of life, Al Akaria is looking to launch a wide range of quality services in the next phase, part of which will be investment in the office real estate, he added.

Al Akaria chief pointed out that making profits in real estate projects takes between two to three years, due to which companies have to rely on off-plan sales, which has become part of the business fundamentals in the real estate sector, and one of the solutions to early results in a faster way and reduce financial burdens.