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Thu 8 Nov 2018 11:07 AM

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Prince Khaled says IPO for KBW Investments 'a possibility'

Prince Khaled bin Alwaleed bin Talal spoke about plans to launch villa projects in Dubai and Saudi Arabia

Prince Khaled says IPO for KBW Investments 'a possibility'
Prince Khaled bin Alwaleed bin Talal spoke about plans to launch villa projects in Dubai and Saudi Arabia.

Dubai-headquartered KBW Investments, the holding company that counts Raimondi Cranes and other construction-related entities in its portfolio, is considering an initial public offering, according to its founder and chairman Prince Khaled bin Alwaleed bin Talal.

KBW Investments also has Sharjah-based developer Arada in its portfolio, a joint venture with Basma Group that has been making headlines across the Gulf for its eye-catching real estate projects in Sharjah - most notably the $6.8bn mega project Aljada.

Prince Khaled, in an interview with CEO Middle East, said while a public listing is not being considered for his second portfolio KBW Ventures, he is looking at a potential IPO for KBW Investments, particularly as the real estate portfolio grows. 

“It’s not a plan for KBW Ventures, but it’s definitely on the table for KBW Investments, and it’s definitely on the table for part of our companies, also. I can’t say which ones yet, because we’re still in the early stages, but it’s definitely a possibility,” said Prince Khaled.

“We’re changing cities, we’re adding value to cities and we’ve got a big real estate portfolio right now, we’ve got a very big construction portfolio right now. I like to call it the hard hat division of KBW Investments. It’s definitely a possibility.

“I think it’s too early right now, but I could think of something maybe in the next three or four years.”

Arada's $6.8bn mega project Aljada.

By that stage, Prince Khaled plans to have launched projects in his native Saudi Arabia, as well as a major project in Dubai, which has been mooted for some time.

“We’re talking with a few parties to move forward with some deals that we want. We’re close to closing a deal with a Dubai entity and it’s one of many. We see a really good opportunity here. We’ve actually identified another opportunity here that we’re going to commit to for Dubai, and all this is in the short term,” he said.

In the medium term, Prince Khaled said the plan is to launch projects in Saudi Arabia.

“Saudi Arabia is the biggest market in the region. It really calls for the type of product we are developing here – there’s a lack of it in Saudi Arabia,” he said, referring to the Nasma Residences project in Sharjah, the multi-phase villa project that is expected to sell-out by the end of the year.

“We’d love to give people [in Saudi Arabia] more room to breathe, have the ability to have a bigger space but at a more affordable price. That’s why, even in Sharjah, we’re extremely competitive when it comes to pricing,” Prince Khaled said.

Nasma Residences

Prince Khaled said he expects that Arada will launch a project in Saudi Arabia, now that it has become more attractive for investors.

“It’s not etched in stone, but I would say we’ll announce something end of 2020, beginning of 2021. We’ll definitely announce something – Saudi Arabia is opening up tremendously. Visa processes are more hassle-free, the opening up of the Saudi market for GCC owners as well as foreign owners is something that’s really encouraging for us as a real estate company,” he said.

“Prices have come down, so that’s attractive, and I think they’ll continue to come down for another year, maybe a year and a half. Then we can literally come in at the right time, with the right price and really benefit.”

While Riyadh and Jeddah would appear on the face of it to be the best cities to for an initial foray into the kingdom, Prince Khaled said the Eastern Province is a location that stands out above all others. 

“My crosshairs are on the Eastern Province, and I would love to do something there. The Eastern Province is hungry – there you have Aramco and the area has been monopolised by one entity. There hasn’t really been a development that really shows the potential of what the Eastern Province can bring,” he said.

“There hasn’t been an Arada-style community at all, and it’s something the Eastern Province should have.”

While Riyadh and Jeddah are also “markets that we have to enter”, he said he would like to study other markets like Tabuk and Qassim

“Nobody’s looking at the southern areas like Asir. These places are absolutely stunning – you’ve got green mountains and the high in the summer is about 35c. They are beautiful, but they are also under-developed and we can easily go in there,” he said.

And once projects are launched in Saudi Arabia, Prince Khaled said it would make more sense to consider an IPO.

“We’ll see Nasma Residences come into play, Dubai and Saudi Arabia come into play, and then we’ll have some really good assets to offer to the market,” said.

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