By Ed Attwood
Exclusive: Chairman says firm is considering moves into hospitality, education and healthcare
Saudi Arabia’s biggest listed developer is hoping to confirm two new projects in Europe – its first overseas – by the end of 2013, the firm’s chairman has said.
“We are hoping to announce two projects by the end of this year in Europe; they are both in the study phase,” Dar Al Arkan founder and chairman Youssef Al Shelash told Arabian Business.
The chairman declined to give any further details about the projects, saying that further information about the developments would be disclosed to the market if they were confirmed.
Dar Al Arkan has so far not ventured outside its home market of Saudi Arabia, where it is working on a series of mixed-use communities in Riyadh, Jeddah and Madinah.
The company launched its first retail complex, Al Qasr Mall, in July last year, and Al Shelash said that Dar Al Arkan would seek to build further malls as part of a plan to diversify its revenue mix by increasing its leasing portfolio and reducing its reliance on land sales.
“Yes, we are now looking to build other malls in Riyadh and Jeddah, but for any megaproject, we need to take a scientific approach, not trial and error,” he said.
The chairman also said that hospitality, and even healthcare and education facilities, could also form a part of Dar Al Arkan’s future product line.
“There is a plan to develop a hotel with a mall, much like the Kempinski at Dubai’s Mall of the Emirates,” Al Shelash said. “The hospitality business is very attractive, especially for four-star hotels, and there is still plenty of demand.
“Furthermore, industry segments like health and education facilities are continuously reviewed by our property development team and should they prove to be feasible, we will certainly consider them for investment purposes.”
Dar Al Arkan, which repaid a $1bn sukuk in July last year, issued the first tranche of a new five-year sukuk programme in May, raising $450m.
Al Shelash said that he was planning to issue the second ticket “which will be around the same number” in either the last quarter of this year or the first quarter of 2014.
The firm’s share price has risen by nearly 19 percent in the year so far, although it reported a 69 percent in net profit in the second quarter to $27.7m. That was largely due to the sale of a piece of land valued at $198m to SABIC in the second quarter of last year.
“This year, I don’t think you’ll see the growth [as a result of the diversification plan] immediately,” Al Shelash said. “2013 will still be a good year, but I think 2014 will be the year of growth for Dar Al Arkan”.
The full interview with Youssef Al Shelash is published in this week’s issue of Arabian Business.For all the latest construction news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.