Arab News, Monday, Jul 04, 2022 | Zul Hijjah 5, 1443
TRSDC signs first JV worth $400m with Al Mutlaq Group
Saudi Arabia:
The Red Sea Development Co. has signed a joint venture agreement worth SR1.5
billion ($400 million) with Almutlaq Real Estate Investment Co., a subsidiary of
the Al Mutlaq Group.
Under the agreement, the two companies will
develop the Jumeirah Red Sea, a 159-key luxury resort situated on The Red Sea
destination’s hub island, Shura, currently under construction and expected to
open in early 2024.
The island forms part of the first phase of
development, and will comprise 11 luxury, premium and lifestyle hotels and
resorts, residential units, a championship golf course, 118 berth marina, and a
comprehensive retail, dining, and entertainment offering.
The strategic partnership marks the first JV
established by TRSDC.
“This joint venture investment reinforces the
private sector’s alignment with our commitment to regenerative tourism and
sustainable development. Our project naturally lends itself to promising
business opportunities, with the ability to leverage the Kingdom’s key strategic
assets, and drive economic growth and diversification as outlined by Vision
2030,” said John Pagano, CEO of TRSDC.
“We are extremely pleased to partner with TRSDC
and its best-in-class management team on this exciting and compelling project.
We have been studying the giga-projects for some time, and the Red Sea is
achieving its vision. The destination is coming to life, and we look forward to
welcoming our first guests in 2024,” said Tariq Almutlaq, chairman of AREIC.
Investors’ interest
TRSDC is in discussions with several other
investors under a similar framework to invest in The Red Sea Project’s
commercial assets, including hotels and resorts, leisure, and retail and dining
experiences. Moreover, AMAALA and additional soon-to-be-announced projects in
the developer’s expanding portfolio bring with them additional opportunities for
investors.
“We are attracting an abundance of third-party
investment interest, particularly those focused on ESG who are confident that
this is an exciting opportunity and one that they do not want to miss out on,”
said Jay Rosen, chief financial officer at TRSDC.
Green financing
The announcement follows TRSDC achieving financial
close on its SR14.120 billion ($3.76 billion) green financing earlier this year
with four leading Saudi banks (Banque Saudi Fransi, Riyad Bank, Saudi British
Bank, and Saudi National Bank). As the first-ever riyal denominated green
financing, TRSDC was acknowledged with an award for Project Finance Deal of Year
in the Capital Markets Saudi Arabia Awards 2021 plus the Best New Green Loan
Financing Project Award at the International Finance Awards 2022.
The Red Sea Project has demonstrated significant
progress on the ground, with Phase-1 now more than 50 percent complete and
several key assets already fully operational, including a four-star management
hotel, on-site offices, and the largest landscape nursery in the region.
TRSDC and AMAALA have awarded over 1,000 contracts
worth in excess of SR25 billion. Work is on track to welcome the first guests in
early 2023, when the first hotels will open, with the balance of phase one set
to complete by early 2024.