Shuaa Capital launches $157m REIT to fund Riyadh property buys

Fund intends to acquire six income-generating real estate assets in four key sectors and in Riyadh
Shuaa Capital launches $157m REIT to fund Riyadh property buys
Shuaa Capital Saudi Arabia’s CEO, Omar Al Jaroudi.
By Sam Bridge
Fri 12 Apr 2019 12:54 AM

Shuaa Capital Saudi Arabia has announced the launch of a SR591.5 million ($157.6 million) real estate investment trust (REIT), approved by the country's Capital Market Authority (CMA).

The subscription period for Shuaa REIT will last until April 7 and the fund will offer 30,515,000 units to the public at a price of SAR10 per unit, equivalent to SR305,150,000, which accounts for 51.5 percent of the REIT's total size.

The fund intends to acquire six income-generating real estate assets in four key sectors in Riyadh.

The company said the targeted return is approximately 7 percent per annum based on freehold ownership structures and excludes lease-interest contracts.

Shuaa Capital Saudi Arabia’s CEO, Omar Al Jaroudi, said: “The launch of Shuaa REIT is a significant milestone for Shuaa Capital Saudi Arabia.

"REITs are globally acknowledged as long-term real estate alternative investment instruments, geared to provide a steady stream of income through periodic distributions whilst providing liquidity through tradable units in the market, full transparency on transactions. Furthermore, REITs are not considered speculative high growth instruments that generates high capital returns.

"We remain focused on offering our clients and investors distinctive financial solutions within the Saudi Arabian market.”

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