Riyadh – Mubasher: Jadwa REIT Al Haramain on Monday announced making two acquisitions in Makkah for a total consideration of SAR 148 million ($39.47 million).
The first deal entails a hospitality building, primarily used by Hajj and Umra pilgrims, for SAR 125 million, which was financed through the existing Shariah-compliant debt facility.
Located 350 metres away from Al Masjid Al Haram or the Grand Mosque, the building is leased for SAR 8 million per Hijri year, Jadwa REIT Al Haramain said in a filing to the Saudi Stock Exchange (Tadawul), indicating that the property carries an initial acquisition yield of 6.4% or around 6.6% for the Gregorian calendar.
“The lease term starts from the date of the acquisition and ends on 1/1/1443 Hijri year or in August 2021,” the statement showed.
Jadwa REIT Al Haramain’s second acquisition was for a commercial property used for retail shops at SAR 23 million.
The commercial property, located 500 metres away from the Grand Msoque, is leased for SAR 1.5 million per Hijri year and carries an initial acquisition yield of 6.5% or around 6.7% per Gregorian year. The lease terms are similar to the first acquisition.
“The Property was purchased from a non-related party after the completion of the due-diligence and obtaining unanimous approval from the Fund's Board,” the real estate investment trust added.
The acquisitions were completed on Sunday, 24 December.
