Riyadh- Saudi Stock Exchange (Tadawul) listed on Sunday Riyadh REIT units as the first Real Estate Investment Traded Fund (REIT) on the Saudi capital market, with a capital of SAR500 million divided to 50 million units.
Tadawul has recently announced plans to list a number of Real Estate Investment Traded Funds in the capital market in the upcoming months. REITs will provide access for all segments of investors to invest in the real estate sector.
The instructions state that a REIT’s capital should not be less than SAR100 million.
Regarding listing Riyadh REIT on the capital market as the first REITs in Saudi Arabia, CEO of Riyadh Capital Ali Al-Guwaiz said, “Income generating real estate trusts will give investors a unique opportunity to share the ownership of real estate that not only have stable financial performances but also regularly distribute dividends.”
He added, “REITs could also be liquidated if needed, which decreases risks that usually accompany such real estate investments. It is expected that the REITs sector will create opportunities for listing large numbers of commercial real estate with high returns, which will probably lead in turn to make REITs the biggest investment sector in the Saudi market.”
REITs are new investments tools that aim at diversifying traded assets in the capital market, unlike bonds and shares. They also contribute in expanding investment in the capital market through providing investment opportunities to a wider segment of those interested in the real estate market.
The exchange’s chief executive officer, Khalid al-Hussan, said, “Increasing and diversifying investment tools lead to deepening the market in line with the kingdom’s economic reform drive.”