Abu Dhabi Developer Plans $267 Million Residential Project in Saudi Arabia
Oil-rich but shelter-poor Saudi Arabia is finally getting some much-needed new housing. Abu Dhabi-based Gulf Capital announced it will be entering Saudi Arabia's real estate market for the first time with a planned, multi-phased $267 million residential undertaking in Riyadh.
Riyadh is the largest city and capital of Saudi Arabia. The SR 1 billion investment equates to over Dh 900 million.
The company said in a prepared statement its first housing project in Saudi Arabia is being launched by its real estate arm, Gulf Related, a joint venture between Gulf Capital and New York City-based Related Companies, one of the largest privately owned real estate development firms in the U.S.
"The development involves a multi-million dollar world-class residential compound in Riyadh which is timely and will fill the acute shortage in residential housing in the Kingdom," according to Emile Habib, Gulf Related managing director for real estate investment..
He said studies show there is "a huge demand for housing units in Saudi Arabia, projected at 1.3 million residential units over the next seven years."
The initial phase of the project will consist of a residential compound which will be built on the first 157,000 square meters plot (about 1.7 million square feet) with 450 residential units. The first phase is tentatively expected to be completed by early 2015.
Habib told the Khaleej Times his firm already has raised funds for the project which include equity and loans from an unnamed Saudi bank.
He says Gulf Capital has acquired two strategically-located plots of land, totaling an area of almost 300,000 square meters where the project will be built. The land is in the growing northwestern part of Riyadh on the Salboukh Highway.
The new development will be about 10 minutes from the King Abdullah Financial District and about 20 minutes from King Khalid International Airport.
Dr. Karim El Solh, CEO of Gulf Capital and Co-Managing Partner of Gulf Related, said in the statement his firm has been "studying the Saudi Arabian real estate market extensively and have concluded that there is significant demand for residential compounds in Riyadh."
El Solh said studies suggest there was currently a shortage of over 100,000 residential units in the capital.
He added that Gulf Related, Gulf Capital's real estate joint venture, "intends to cater for this growing need by launching one of the largest and most appealing residential compounds in Riyadh."
"This development is in line with our vision to pursue marquee real estate development opportunities across the region which will contribute significant, stable income to Gulf Capital and its shareholders," he said.