Al Akaria obtains SAR 400 mln Shariah-compliant financing from Bank AlJazira for Riyadh land

Logo of Al Akaria

Saudi Real Estate Co. (Al Akaria) obtained Shariah-compliant banking facilities (bridge financing) worth SAR 400 million from Bank AlJazira to finance part of the purchase value of the raw land in east Riyadh.

The company said in a bourse statement that the financing duration is 360 days and is guaranteed by a promissory note amounting to SAR 400 million and a pledge of the financed real estate in favor of the bank.

A total of SAR 382.68 million was withdrawn from the financing value to pay part of the purchase value of the aforementioned land. The other part of the purchase value was financed from the company’s resources.

AlAkaria board member, Mohammed bin Dawood, is a related party, and also a member in the board of directors of Bank AlJazira.

According to data compiled by Argaam, Al Akaria recently purchased 1.91 million square meters (sqm) undeveloped land plot in east Riyadh at a total value of SAR 727.09 million, or SAR 380/ square meter, excluding the real estate transaction tax and broker's commission.

The land plot will be developed and sold later to be utilized in real estate projects, which will boost the company’s operating revenue as well as assets.