Dubai: Saudi Arabia’s sovereign wealth fund finalised a deal to take ownership of Riyadh’s $10 billion unfinished financial hub as the government attempts to revive the project, according to people familiar with the matter.
The Public Investment Fund (PIF) is taking control of the King Abdullah Financial District from the Public Pension Agency, the people said, asking not to be identified because the information is private. Details of the deal aren’t clear, they said.
The fund will appoint Hilmi Ghosheh as the head of the hub that has been plagued by delays and cost overruns, the people said. Ghosheh is currently advising the PIF’s Managing Director Yasir Al Rumayyan on real estate projects, according to his LinkedIn profile.
Crown Prince Mohammad Bin Salman lists the rehabilitation of the financial district as one of his objectives in the kingdom’s Vision 2030 economic reform plan. The government plans to make the area an economic freezone with visa exemptions and a direct connection to the airport. Construction of the hub with 73 buildings in the north of Riyadh started in 2006.
The government restructured the financial district and reduced the number of offices and increased the number of residential units so the project “didn’t fail,” Prince Mohammad told Bloomberg in an interview last month. The first phase will open next year and Saudi Arabia plans to host the G-20 meeting at the hub in 2020, he said.
HSBC Holdings Plc’s local unit was advising the pension agency on the sale of the district, while JPMorgan Chase & Co. was working with the PIF, people familiar with the matter said in November 2016. A spokesman for the PIF declined to comment.