JEDDAH, 16 February 2004 — The National Commercial Bank (NCB) has launched its latest investment fund, which is specifically designed to support local investment in the rapidly expanding Saudi real estate market.
“Al-Ahli Real Estate Income Fund,” which has investments of SR345 million in the Saudi real estate market, is classified by NCB as a local investment support project with a full capital investment within the local market to purchase residential and commercial properties then lease them to high credit companies in the cities of Riyadh, Jubail and Yanbu.
“The fund will provide a return on investment that is competitive with what is available in the Saudi real estate income market. It has an expected net profit of 61 percent annually,” said NCB General Manager Abdulhadi Shayef, commenting on the funds objectives.
Shayef also stated that the fund could possibly provide capital gains through real estate properties liquidation at the end of the funds six-and a half-year term while providing semi-annual cash flow not exceeding 20 percent of each investor’s subscription. “Al-Ahli Real Estate Income Fund” has been approved by the Shariah Advisory Committee and operates in accordance with Islamic Shariah investment principles, with a minimum subscription of SR100,000. NCB has set a subscription period of one month beginning from Feb. 7, 2004.
“The development of such a concept complies with the strategy of NCB, which is to play a major role in the growth of local investment funds in the Kingdom. The fund opens vast opportunities for investors and NCB clients, to participate and benefit from the prosperity and success of the Kingdom’s real estate market,” Shayef concluded.
NCB forecasts indicate that the economic recovery in the industrial cities, together with the population growth in the Kingdom, will result in an increase in real estate value and growth of local liquidity that will provide a good stimulus to the success of the fund, which is categorized as medium to long term investment.