Saudi Arabia's Jadwa Investment launches real estate growth fund

The close-ended, Sharia-compliant investment fund has a target size of $800m

Residential housing and skyscrapers stand on the city skyline in Riyadh, Saudi Arabia, on Saturday, Jan. 9, 2016. Saudi Arabian stocks led Gulf Arab markets lower after oil extended its slump from the lowest close since 2004. Photographer: Waseem Obaidi/Bloomberg

Saudi asset management and advisory company Jadwa Investment has launched a new real estate fund with a target size of 3 billion Saudi riyals ($800 million) as it seeks to capitalise on the growth of the kingdom's rapidly expanding property market.

The Real Estate Growth Fund, launched in partnership with Tatweer Group, Numu Holding Company and Riyad Bank, is a close-ended, Sharia-compliant real estate investment fund, Jadwa said in a statement on Sunday.

The fund aims to provide investors with a "stable stream of income and compelling capital appreciation over the medium to long-term by investing in differentiated, income-generating properties" in the kingdom, it said.

“The successful launch of the Real Estate Growth Fund underscores our belief in Saudi Arabia’s real estate sector,” said Tariq Al Sudairy, managing director and chief executive of Jadwa Investment.

Saudi Arabia is focused on diversifying the economy under its Vision 2030 agenda, which aims to develop local industries and cut its dependence on hydrocarbons.

The kingdom plans to turn Riyadh into one of the top 10 city-economies in the world and is investing $220bn to transform the Saudi capital.

Riyadh-headquartered Jadwa Investment said its new fund has already acquired The Zone, one of Riyadh’s most prominent commercial assets, located in Al Mohammadiya district, with debt financing provided by Riyad Bank.

Real Estate Growth Fund is part of Jadwa’s diversified real estate portfolio, which has expanded in the past two years and marks its third partnership with Saudi developer Tatweer Group.

In December, it set up a property fund worth 250m riyals to invest in the development of multiple commercial complexes in Riyadh and Jeddah.

Al Shorfa Investment Fund, also a Sharia-compliant real estate investment vehicle, has an expected term of five years, Jadwa said at the time.

Overall, the firm manages a total of 12.6bn riyals in real estate assets across its various development and income-generating funds, as of February.

Jadwa has total client assets worth more than 70bn riyals in public equity, private equity, real estate, private credit, fixed income and money market investments.

Its clients include government-related entities, local and international institutional investors, local family companies and high-net-worth individuals.

Updated: March 13, 2022, 5:41 PM