Tuesday 02, January 2018 by Jessica Combes

Al Rajhi Capital REIT IPO now open

 

Public subscription in Al Rajhi Capital’s Al Rajhi REIT Fund IPO which will run from 1 to 14 January 2018 is now open.

 

The fund manager will offer 42.67 million units at SAR 10 each. Subscription will be available through Al Rajhi Bank website and Al Rajhi Capital investment centres at a minimum value of SAR 1,000.

Al Rajhi REIT will have a fund size of SAR 1.62 billion, according to the fund manager.

The Shari'ah-compliant fund aims to acquire or invest in income generating commercial, office, and educational assets, as well as warehouses, which are mainly located in the Kingdom, except for Makkah and Madinah.

“The fund’s investment target is to invest in developed, income-generating assets, and to lease and distribute at least 90 per cent of the fund’s annual net income in cash over the fund term on a semi-annual basis,” according to statement by Al Rajhi Capital.

Al Rajhi REIT’s preliminary portfolio comprises 13 high-quality assets that generate income at the end of January and July of every year.

The fund’s assets are spread across various sectors in the Kingdom, namely: retail (54 per cent), warehouses (12 per cent), offices (26 per cent) and education sector (eight per cent).

Eligible investors are Saudis, GCC nationals, foreigners residing in Kingdom, institutions, companies, and investment funds operating in the Kingdom, along with Qualified Foreign Investors (QFIs).

Al Rajhi REIT Fund is Al Rajhi Capital’s first Real Estate Investment Traded Fund (REIT) offering investors exposure to the Real Estate Market. Al Rajhi REIT Fund leverages Al Rajhi Capital’s extensive experience in real estate sector and comprises of a well-diversified portfolio of 13 real estate properties spread across multiple four strategic sectors and locations in the Kingdom. As a listed and traded instrument, Al Rajhi REIT Fund offers a convenient way for investors to access real estate market by collectively owning real estate properties generating periodical rental income, and with a potential to benefit from long-term capital appreciation.

Features & Analyses