Gulf Capital gets 450 million Saudi rials loan

Abu Dhabi: Abu Dhabi-based private equity firm Gulf Capital said yesterday it has signed a 450 million Saudi rials financing facility deal with the National Commercial Bank to finance the projects of its real estate development arm, Gulf Related, in Saudi Arabia.

“(The) 10-year flexible facility allows Gulf Related to launch an ambitious SR650 million residential compound in Northwest Riyadh to meet pent-up demand for housing. The long-term structured facility will allow Gulf Related to leverage its investments in the Kingdom, following the announcement last year of a multi-million dollar high-end residential project in Riyadh,” Gulf Capital said in a statement.

“The financing for the project has been done at competitive market rates. Our equity is SR200 million. The excavation work at the project will start this week. The project will take 24 months to complete. In May 2015, we will open our first phase,” Emile Habib, managing director for Gulf Related told reporters at a news conference in the capital.

“We expect to reach a break even in 3 to 5 years. Through this project, we are targeting the expatriates living in Saudi Arabia,” he added.

The Saudi residential compound would include 525 villas, townhouses, duplexes and apartment units.

Gulf Capital said studies show that there is a huge demand for housing units in Saudi Arabia, projected at 1.3 million residential units over the next seven years. This is largely being driven by domestic demand with Saudis Nationals making up more than two-thirds of the population.

“However, demand for housing and other services from expatriate sources have increased rapidly over the last 3 years with a surge in expatriate population by more than 20 per cent,” it added.

El Solh said the feasibility studies for phase-II of the Saudi residential project will commence in June and they expect to launch the project in two years time, coinciding with the delivery of phase-I.