Sixty individual and institutional investors met in Makkah recently to study tender documents for the development of the Jabal Al-Sharashef area.
Makkah Gov. Prince Khaled Al-Faisal launched the introductory meeting held by Al-Balad Al-Ameen Development and Urban Regeneration Company, Makkah municipality's investment arm, to brief interested parties on the project.
Major investors and representatives of funds and local banks attended the meeting.
Sources told local journalists that 60 investors received copies of the offers for investment in this prime real estate area.
Eight investment partnerships, including major local banks, the Public Pension Agency and a number of mutual funds will compete for the project.
The development of Jabal Al-Sharashef will start once the Haj ends. The project includes the appropriation of 13,000 properties, with compensation to owners likely to exceed SR20 billion. This money is likely to be pumped back into the real estate sector, which may hike property prices, experts say.
Osama Al-Bar, mayor of Makkah, said property owners have two choices. "They can either receive compensation, which the real estate committee will estimate, or participate in the project itself as investors," he said.
He said the committee overseeing the project would have to request title deeds of properties, while the alternative housing committee would find accommodation for those who have their property appropriated.
The Jabal Al-Sharashef development plan includes hotels and pilgrim accommodation on two sides of the mountain, with local residents making up a maximum of 30 percent of the housing.
The Ministry of Transport, Makkah governorate, and the High Commission for Makkah Development approved a study of the proposed development plan.
Sheikh Yusuf Al-Ahmadi, a developer, told local journalists that the development was a positive step for the region, but building hotels and residential towers would negatively affect the housing sector.
"The region can accommodate 600 hotels that will lead to a fall in hotel prices," said Al-Ahmadi.
Jabal Al-Sharashef development work to start after Haj
