Abu Dhabi: Saudi Arabia has reformed its municipal investment system allowing direct lease oof real estate for up to three months, up to 50 years rental of municipal lands and exemption to rent during construction works for up to 10 per cent of the project term, Saudi media reported.
Saudi designated Minister of Municipal and Rural Affairs, Majed Al Hogail, has approved the revised regulations for the municipal real estate transactions.
The move comes as part of efforts to develop the municipal investment system to provide an attractive environment to attract quality investments to Saudi cities by providing a fair, attractive and competitive environment that raises the private sector’s appetite for investment with municipalities to develop Saudi cities, which will be reflected in raising the quality of life there.
Eng. Khaled Al Deghaither, Undersecretary of Ministry of Municipal and Rural Affairs for Planning and Programmes, said Saudi municipalities offers annually a calendar of investment opportunities and the number of investment opportunities offered this year by municipalities across the Kingdom reached 4,511 leases.
“The most prominent features of the revised regulations include enabling the qualification of investors based on the technical ability and financial solvency of specific projects to ensure raising the quality and durability of investment projects, opening new horizons by enabling many models of partnership with the private sector, and increasing the contractual terms to 50 years to attract capital investments for major projects,” Al Deghaither said.
There are opportunities being offered in the health and commercial sector, road advertisements, parking lots and kiosks, in addition to opportunities in medical cities.
He indicated that the regulations included amending the period exempted from rental during construction works to up to 10 per cent of the project term, the option of direct leasing of municipal real estate for temporary purposes, for up to three months, in addition to reducing the value of bank guarantees to become 25 per cent of the bid value from 100 per cent previously.
The revised regulations also included many controls aimed at raising the quality of life in Saudi cities, he said.