This agreement with Alinma is part of Jeddah Economic Company’s drive to diversify its sources of funding.

Jeddah Economic Company and Saudi Arabia’s Alinma Investment have signed a deal to initiate an SR8.4 billion fund.

Jeddah Economic Company is the owner and developer of the Jeddah Economic City project and Jeddah Tower in Obhur, just north of Jeddah on the Red Sea coast.

Alinma Investment is an SR1 billion Saudi limited liability company established by the namesake bank to pioneer a comprehensive system of investment products and services.

The fund, to be named the Alinma Jeddah Economic City Fund, is a Shariah-compliant fund that will operate under the Saudi Arabian Capital Market Authority (CMA) and current laws in Saudi Arabia.

Initially, its purpose will be to develop the first phase of the Jeddah Economic City project and finish construction work on Jeddah Tower, currently at its 26th floor, as well as a number of major real estate projects within the project.

Alinma Bank will finance the fund, to be managed by Alinma Investment, while Jeddah Economic Company will be the master developer of projects that will draw on the fund’s credit lines.

Prince Alwaleed bin Talal, chairman of Kingdom Holding Company, will chair the fund’s board, with AbdulMohsen Alfaris, CEO of Alinma Bank, as deputy chairman.

Abdulrahman Sharbatly, Saleh Binladen, Talal Al-Maiman, Hassan Sharbatly, Samawal Bakhsh, Abdulrahman Jawah, Fouad Al-Rashid, Mohammed Al-Shuhaibany and Bandar Alturki will be members of the board.

Jeddah Economic Company bought out the entirety of the fund’s units.

The agreement was signed in the presence of Prince Alwaleed, Jeddah Economic Company’s board members, and Alinma Bank and Alinma Investment representatives.

The ceremony took place at Prince Alwaleed’s office at the Kingdom Holding Company in Riyadh.

“This agreement with Alinma is part of Jeddah Economic Company’s drive to diversify its sources of funding for Jeddah Tower and Jeddah Economic City,” said Prince Alwaleed.

“Our cooperation with the banking sector is a manifestation of just how strongly we believe in this ambitious project, which is set to become the pride and joy of every Saudi, especially those who reside in Jeddah, and will become an iconic urban center that will take the city to the next level, both regionally and globally.”

Prince Alwaleed said that the primary purpose of developing Jeddah Economic City is to provide a state-of-the-art living, working and entertainment environment for its community to enjoy a unique way of life, with the best possible levels of services that up-and-coming Saudis aspire to.

“Jeddah Economic City will be a must-go destination for those who visit Jeddah for business, trade, entertainment, culture, medical treatment and education, and will be a trendsetter in future real estate and urban development, all while securing the future of young Saudis with job opportunities and meeting the ever-growing demand for housing.”

Abdulmohsen Al-Fares, Alinma Bank’s CEO, said: “We at Alinma Investment seek to create fruitful strategic partnerships with various sectors in the real estate industry that enjoy a wealth of management expertise and are capable of managing successful investment projects, thus supporting investment plans and removing hurdles in the way of bringing these projects to fruition.”

The CEO said: “Jeddah Tower and Jeddah Economic City are pioneering projects that will transform their namesake city, and we are happy to be cooperating with Jeddah Economic Company and contributing to the building of this great project.”

Talal Al-Maiman, executive director of the Kingdom Holding Company, said that financial planning for the project took over two years.

“When we formulated and prepared the financial model, which included all aspects of cost and revenue, we made sure that we studied every single one of the project’s needs,” he said.

“Alinma Investment has been an active partner in the process of devising a detailed, sophisticated financial model that complies with Sharia and law so we can build the world’s highest skyscraper on our homeland. Such a financial model will set the trend for future real estate projects.”

Mounib Hammoud, CEO of Jeddah Economic Company, said that 26 floors of Jeddah Tower built over an area of 85,000 square meters, have already been completed.

Now that the agreement has been signed and required funds secured, Hammoud expects the project to be finished on schedule.

“With this deal, we will reach new, as yet unheard of highs in real estate development, and will fulfill the company’s objective of creating a world-class urban center that offers an advanced lifestyle, so that Jeddah may have a new iconic landmark that attracts people from all walks of society with comprehensive services and a multitude of uses,” said Hammoud.

“The overall layout of Jeddah Economic City is designed to accommodate a comprehensive, multipurpose environment, replete with aspects of a modern lifestyle over its 5.3 square kilometers, supported by world-class, state-of-the-art infrastructures.

“The first phase, to be constructed over 1.5 sq km, will accommodate more than 3.3 million square meters of modern, multipurpose structures, which will form the nucleus of northern Jeddah’s downtown, bolstering the city’s standing in the world.”

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