The Saudi joint stock company’s focus on the real estate sector stems from the fact that this sector is among the most promising ones in the Kingdom, a team of Alawwal executives told a press conference at Hilton’s Qasr Al Sharq hotel on Sunday.

The real estate sector is capable of absorbing more capital injections locally and from overseas. Market studies reveal that the Kingdom requires over 200,000 housing units annually. Real estate transactions exceed a trillion riyals annually. “It is anticipated that the market will bounce even higher once the new real estate mortgage law is announced,” said Alawwal Chairman Saleh Malaikah.

“People are just waiting for the new mortgage law and once it comes there will be a tremendous boost to housing demands, which in turn will put extraordinary pressure on development of land and infrastructure utilities,” he said.

The fund launch follows its recent approval by the Capital Markets Authority for developing a 1,682,011 square meter plot of land that is divided into 1,702 smaller units in the Taiba District 6 in the south of Riyadh.

“The fund aims to provide distinguished investment products for our clients, enabling them to participate in mega-investment plans that give generous returns with a minimum of risk,” said Alawwal’s CEO & MD Adnan Talmisany. This is part of a series of investment products that the company has launched in several economic sectors and is subject to the regulations of CMA, he added.

Concerning the fund’s investment strategy, Talmisany said the fund’s SR375 million capital will be invested in the development of virgin land at the south of Riyadh, along the eastern circle road that leads to the Saudi Aramco refinery. The land will be developed with infrastructure to build modular housing units on one part of the plot and the remaining portion will be sold as land parcels, giving excellent returns to investors. The project will be ready to receive families of medium to low income. The targeted audience is workers in the neighboring industrial areas. The life of the fund can be extended.

Alawwal is among the pioneers in providing Shariah-compliant investment products such as launching and managing portfolios and investment funds, providing custodial services for securities, advising on company creation, mergers and acquisitions, and economic consultations.

To achieve the fund’s objectives, the expertise of Ulayya Real Estate Development has been called on. It is one of the pioneers in land development and is represented by Hamad Bin Seaidan who has over 30 years of real experience in the field.

The participation in the fund is open to both citizens and resident expatriates through its head office in Jeddah and branches in Riyadh and the Eastern Province. To facilitate participation in the fund, the company has formed a specialized team and has reached an agreement of cooperation with Samba and the National Commercial Bank.