Jadwa REIT Saudi debuts on Tadawul today

Jadwa REIT Saudi Fund will start trading on Saudi Stock Exchange (Tadawul) today under the code 4342, with a daily price fluctuation limit of 10 percent per unit.

The fund’s initial public offering (IPO) in January was 120.9 percent oversubscribed, with 57,600 investors subscribing to 47.4 million units.

A minimum of 50 units per subscriber were allotted, while the remaining units were allotted on a pro rata basis of 81.77 percent for each subscription request above the minimum subscription.

Jadwa REIT Saudi is a sharia-compliant closed real estate investment fund with a target size of SAR 1.58 billion.

Fund's Profile
Fund	Jadwa REIT Saudi. Close ended, Sharia-compliant
Fund Manager	Jadwa Investment
Investment objectives	Invests in income-generating, developed real estate assets all over the Kingdom except Mecca and Medina
Size	SAR 1.58 bln
Offering size	SAR 474 mln
Subscription value	SAR 1.02 bln
Fund manager’s subscription	SAR 89.44 mln
Total number of units after IPO	158 mln
Unit price	SAR 10
Fund duration	99 years from listing date and could be extended for a similar period, after obtaining board and CMA approvals
Subscription fees	2% from subscription amount
Management fees	0.75% from net assets annually
Cash Dividend	Quarterly distributions. Annual dividend shall be no less than 90% of net income excluding capital gains.

Jadwa REIT Saudi’s asset base comprises five real estate assets worth SAR 1.55 billion, located mainly in Riyadh, Dammam and Al-Khobar.

The assets include residential, commercial, and educational properties as well as warehouses, built over 428,200 square meters.

Jadwa REIT Saudi Properties
Property	City	Sector	Land area (000’ m²)	Building area (000’ m²)	Rent contract duration
Marvela residential compound	Riyadh	Residential, Commercial	73.2	158.7	5
Al Maarefa College	Riyadh	Educational	18.1	41.8	20
Al Solay Warehouse	Riyadh	Warehouses, offices, shops	218.9	143.4	5
Al Youm Newspaper Tower	Dammam	Commercial, offices	4.8	39.2	7
Al Fanar Residential & Commercial Compound	Al Khobar	Residential, Commercial	62.5	45.0	8 for residential, 5 for commercial

The fund seeks to generate SAR 129.96 million in leasing income in 2018, with a gross return of 8.39 percent and a net return of 7.3 percent annually.

Targeted Returns
Year	Net rentals (SAR mln)	Gross returns on initial assets*	Gross fund returns *	Net fund returns *
2018	129.96	8.39%	8.23%	7.30%
2019	130.32	8.41%	8.25%	7.32%
2020	131.39	8.48%	8.32%	7.39%
2021	131.87	8.52%	8.35%	7.42%
2022	132.25	8.54%	8.37%	7.44%

* Returns were calculated on the assumption that assets will be acquired before 2018 end.

Share prices of seven Tadawul-listed REIT funds have dropped, compared to the time of listing, with Mulkia REIT dropping 14 percent as of Feb. 8.

Meanwhile, Aljazira REIT and Taaleem REIT have risen 60 percent and 9 percent, respectively.

REIT Funds Performance
REIT	Fund Size (SAR mn)	Listing Price (SAR)	Closing as of Feb. 8, 2018 (SAR)	Variation
Aljazira REIT	118.0	10.00	15.95	+60%
Taleem REIT	285.0	10.00	10.90	+9%
Jadwa REIT Al Haramin	660.0	10.00	9.48	(5%)
Musharaka REIT	880.0	10.00	9.50	(5%)
Riyad REIT	500.0	10.00	9.27	(7%)
AlAhli REIT (1)	1,375.0	10.00	8.98	(10%)
Al Ma’athar REIT	613.7	10.00	8.85	(12%)
Al Masha’ar REIT	572.4	10.00	8.77	(12%)
Mulkia Gulf REIT	600.0	10.00	8.63	(14%)
Jadwa REIT Saudi	1,580.0	10.00

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