Arcapita closes $500 million Logistics Fund in Saudi Arabia

The fund participants include a leading sovereign wealth fund from the GCC region and major institutional investors

Hisham Al Raee, deputy chief executive of Arcapita Group. Supplied photo

Arcapita Capital Company, a subsidiary of Arcapita Group Holdings Limited, announced today the closing of KSA Logistics Fund III for 1.8 billion Saudi riyals ($500 million), with participation from a leading sovereign wealth fund from the GCC region and other major institutional investors.

Arcapita has already deployed a substantial amount of the fund in a sizable portfolio of industrial real estate assets across the manufacturing and warehousing sectors. Over the coming months, the company expects to execute a pipeline of further assets situated in strategic locations across Riyadh, Jeddah, and the Eastern Province. Arcapita will also take a built-to-suit approach, whereby properties will be developed with long-term off-take arrangements with tenants.

This fund further demonstrates Arcapita’s strategy of bringing the company's international expertise in industrial real estate to the kingdom’s industrial sector and supporting its ambitions of becoming a global logistics hub.

“Today marks an important milestone in our strategic expansion in Saudi Arabia, the largest economy in the Mena region," Hisham Al Raee, deputy chief executive of Arcapita Group, said.

"We currently manage over SAR 3.8bn of industrial warehousing assets in KSA and the GCC region, and our investor base includes pension funds, sovereign wealth funds, and financial institutions.

"The industrial and logistics sectors are key components of the kingdom’s Global Supply Chain Resilience Initiative, which aims to attract SAR 40bn in investments. We look forward to continuing to deploy our expertise in the industrial real estate sector to play a key role in transforming the kingdom into a global logistics hub.”

Yousif Al Abdulla, managing director and head of Mena investment at Arcapita Group, said: “We expect Saudi Arabia’s industrial real estate market to experience substantial growth over the long term, driven by the significant and continued growth of e-commerce across the kingdom and by strong government-led investment in infrastructure and the industrial sector.

"Arcapita Group’s portfolio strategy will leverage opportunities presented by the National Industrial Development and Logistics Programme, as well as the kingdom’s Vision 2030 plan.”

Arcapita Group’s management team has managed more than SAR 24.3bn in industrial and logistics real estate transactions globally, including more than SAR 5.6bn in the GCC region, over the past 25 years. Furthermore, Arcapita Group has a strong track record of investing in the kingdom, with nearly SAR 1.5bn in investments over the past 10 years.

Arcapita Capital Company operates in Saudi Arabia as a licensed financial institution, regulated by the Capital Market Authority under license number 32-22237.