Author : editorial
MANAMA: The investment banking subsidiary of Saudi Arabia's Al-Rajhi Bank, Al-Rajhi Capital, and Bahrain-based global investment bank, Arcapita BankArcapita Bank, have announced the launch of a $500 million fund aimed at the regional real estate sector, the ARC Real Estate Income Fund.
The entities will seed the fund with a joint investment of $50 million and acquire investments for the fund in high-quality, income-generating real estate assets in Saudi Arabia and other GCC (Gulf Cooperation Council) nations. The focus will be on logistics warehouses, as well as healthcare and education-related assets.
Al-Rajhi Capital, the largest commercial bank in the GCC in terms of market capitalization and the world's largest Islamic bank, and Arcapita also announced the completion of the fund's first acquisition, the largest logistics and distribution center in Riyadh.
The logistics facility is the main distribution hub for Azizia Panda United Company, a leading supermarket company in Saudi Arabia and was acquired for $79.7 million. It will be leased back to Azizia Panda United Company for a period of 18 years.
"As the economic downturn shows signs of bottoming out, we are beginning to see good opportunities for investors with available capital for investment. We believe that this fund is launching at a time that will allow us to deploy our financial resources to gather a portfolio of prime real estate assets at attractive valuations," said Jorge Cantonnet, managing director and head of private equity at Al-Rajhi Capital.
He said the partnership with Arcapita creates a powerful execution capability to leverage the investment opportunities, both in Saudi Arabia and the rest of the GCC. "Early responses from investors have been very positive."
The fund was being offered to qualified institutional and high net worth investors within the GCC region.
"We have worked closely with investors in developing the fund mandate. Investors are exhibiting good appetite for high-quality yielding investments within the GCC, particularly in Saudi Arabia, where economic growth has remained strong and positive throughout the economic downturn," said Hisham Al-Raee, executive director of investment placement at Arcapita.
"GCC growth will outpace global growth in the next 10 years and this income fund offers diversified exposure to the regional growth story," he said.
Source : Arab News
Source : Arab news
