huaa Capital, a premier financial services company in the UAE, has announced the issuance and private placement of a $135-million Islamic bond (sukuk) for Jabal Omar Development Company, one of the largest publicly-listed real estate companies in Saudi Arabia, as it seeks to strategically diversify its capital base.
Shuaa acted as the sole arranger for the sukuk which was originally issued in the second half of 2018.
The sukuk represents a fitting choice of financing for JODC, given the long-term nature of its requirements as a real estate developer and its focus on Makkah, said the statement from Shuaa.
It also reflects a growing trend for sukuk issuances, which raised $97.79 billion globally in 2017, up 45 per cent year-on-year, and particularly in Saudi Arabia, which raised more than $26 billion that year, it added.
On the successful placement, CEO Fawad Tariq Khan said: “Sukuks represent an ideal financing mechanism for the long-term funding requirements of real estate, as reflected by the dominance of the sector in issuing sukuks over the past 18 months in the region.”
“In line with our growing role in both the Saudi financial and real estate markets, Shuaa Capital’s combination of expertise therefore made us the natural partner for Jabal Omar Development Company and we are delighted to support its successful Sukuk issuance,” he noted.
JODC is one of the largest listed real estate companies on the Saudi bourse Tadawul and the company’s sukuk issuance will support its capital raising initiatives towards the growth and development of its real estate activities, specifically in and around Makkah.
Its flagship project, Jabal Omar, is a multi-use real estate mega development project consisting of a total built-up area exceeding 2 million sq m within walking distance of The Grand Mosque of Makkah.