UAE developer Arada has teamed up with Alya Developments to explore co-investment opportunities in premium property in the Emirates and Saudi Arabia, following the former's entry into the kingdom.
Arada's newly established investment management platform, Arada Capital, and Alya signed a preliminary agreement to explore premium developments in the Emirates and Saudi Arabia under a potential Dh6 billion ($1.63 billion) pipeline, they said in a joint statement on Thursday.
The companies will initially pursue two projects in the UAE, with Abu Dhabi's Yas Island and Downtown Dubai earmarked as potential areas, they said in a joint statement on Thursday. It did not provide plans for Saudi Arabia.
Arada Capital, the investment management platform of Arada Group, was announced in July and is aiming for $5 billion in assets under management within four years. Arada Group is jointly owned by Saudi businessman Prince Khaled bin Alwaleed’s KBW Investments and Sharjah-based Basma Group. Alya is backed by Canada's Brookfield, which manages about $1 trillion in assets, and Abu Dhabi-based Lunate, a global investment firm with more than $125 billion in assets.
The move follows last month's launch of Arada's Dh14 billion residential project in Riyadh, as the developer expands into the kingdom.
Arada's group chief executive has separately outlined plans to build 100,000 homes across Saudi Arabia over the next three to five years. Arada also has operations in Australia, Syria and the UK.
“This partnership represents an important milestone in Arada Capital's ambition as a fund manager … we see significant potential to bring forward premium residential projects distinguished by their quality, thoughtful design and disciplined delivery,” said Moustafa Fahour, chief executive and managing director of Arada Capital.
“Our shared ambition is to create homes of enduring quality and value, for the people who live in them and those who invest in them,” added Otto Dreyer, chief executive of Alya.
Property developers are continuing to launch projects in the UAE despite concerns about the slowing of the market as the Iran war continues.
This week, Dubai’s Nakheel unveiled the new Palm Springs master development next to Palm Jebel Ali, while Abu Dhabi’s Aldar Properties last month said it plans to launch a major development of villas and townhouses in Dubai by the end of this year as part of the company’s expansion across the UAE.
In September, Arada and Aldar teamed up to build new housing projects on Yas Island and at Seih Sdeirah in Abu Dhabi, representing a combined value of about Dh15 billion. Arada also unveiled plans for a $7 billion “UAE-style” development in Damascus.
Saudi Arabia, meanwhile, has boosted its real estate sector as it continues its economic diversification strategy.
In January, the kingdom began implementing an updated property ownership law for non-Saudis, allowing foreign individuals and companies to acquire real estate subject to regulatory and geographical restrictions. The authorities expect the changes to attract international developers, stimulate investment and support economic diversification.
“The UAE and Saudi Arabia continue to present compelling long-term opportunities and our focus is on bringing together the right partners, capital and expertise to deliver sustainable value for investors and communities alike,” Mr Fahour said.
Second Australia approval secured
Separately on Thursday, Arada said it has received approval for its Dh1.6 billion Wattle Green residential community in Castle Hill, New South Wales, Australia.
The 14,000-square-metre project is planned to feature 445 residences across three buildings.
The approval is Arada's second major planning consent in Australia within a little over a month, after securing a similar decision for the 33-storey London Place residential project in Campsie, south-west of Sydney, early last month.
“We are pushing ahead with our pipeline of projects at a time when we know delivery in this market demands real conviction,” Arada group chief executive Ahmed Alkhoshaibi said.
