Naru Capital breaks records in Saudi Arabia
Naru Capital, the UAE-headquartered global deal facilitation and capital-raising firm, has broken new ground in opening doors to real estate deals in Riyadh that have yielded up to 48% ROI, and are now targeted to achieve an even higher return.
July 21, 2014 12:14 by kippreport
Partnering with developers Salman Abdullah Bin Saedan Real Estate Group (SABS Group), the Bin Saedan Family is known and highly-regarded in Saudi Arabia for playing an important and effective role in the development of commercial, residential and industrial projects in Riyadh and several other major Saudi cities, since incorporating the company 45 years ago.
As a deal facilitator, Naru Capital has drawn upon its extensive contacts book of trusted investors to introduce an exciting Bin Saedan Real Estate Fund, and capitalise on the extraordinary returns available through its Private Real Estate Multi-Project Fund, worth SAR 170,000,000.
Bin Saedan Real Estate Group Chairman, Sheikh Salman Abdullah Bin Saedan, commented on the impressive depth of interest in the Fund coming from outside of the Kingdom, in particular reference toNaru Capital’s introduction of more than 35 investors from across the GCC, of whom over 62% were of CEO, Chairman and Managing Director level.
Sheikh Salman observed: “The Bin Saedan Real Estate Group is taking the lead in developing Saudi real estate mutual funds. This fact is well known to local investors, but not to international investors. NaruCapital arranged this ‘Investor Road Show’ of meetings tailored exactly to our requirements, and it has given the Group the opportunity not only to be introduced in the GCC as a leader in real estate development, but also to progress beyond local borders.”
Commenting on the methodology and success rate of their investor introductions, Naru Capital Managing Director, Fabien Faure explained: “More than looking at just the financial capabilities of the investors, we also discuss their alternative reasons as to why they will consider an opportunity, before we make any introductions. We have developed trusting relationships with our investors, through constant and open dialogue and understanding their emotional connection to a particular industry, region or opportunity. We also work closely with our investors to establish how a project could benefit them from a PR point of view, or sometimes how it could benefit them politically.”
The Fund itself represents well-researched expert insight and extraordinary opportunities, compared to any global standard. With a total land area of over 702,600 m2 , 739 parcels of land, the development of 100 high quality villas, a projected yearly return of 16.5%, and a projected total ROI of 49.4%, NaruCapital’s role in the Fund was to raise capital, reach out to both the GCC market and investors further afield, and reinforce the Bin Saedan Real Estate brand name outside of Saudi Arabia. Having met with CEO’s, MDs, Chairmen and General Managers of Banks, Holding Companies and Real Estate Developers from Turkey, Qatar, Oman, Kuwait, the UAE and Bahrain, as well as investors from the KSA itself, Sheikh Salman concluded:“Knowing that Naru Capital has vast experience and an important database of international investors, the Group has the comfort and assurance that it is being introduced to the right potential investors, as they are being carefully selected by Naru Capital for having their own investment criteria that match our fund.”
According to a recent study by Jones Lang LaSalle, the future demand for housing units in Riyadh is estimated at 1.15 million units by 2018, with key factors highlighted to be the large growing population with sustained migration, the under-supply of affordable housing for the middle income buyer, which comprises of 43% of the total population, and shortage of large developments and availability of land in the area. Confirming the strong commercial viability of the project, and commenting on investor protections, Sheikh Salman added:
“The high demand in Saudi for the provision of residential units is due to the shortage of units, and this known demand is what the Fund will be capitalizing upon. The guarantees the CMA provides to all the investors ensure their rights and safety when investing in the Fund. Coming from one of the most well-known and trusted families working in real estate developments for so many years provides added value for the Fund, since Salman Bin Saedan Real Estate is the developer.”
Naru Capital is now introducing potential partners and investors from the GCC to this private multi-project real estate fund, structured to cater to the demand. The first round of meetings has already taken place, and due to the tremendous interest from prospective investors, a second round of meetings is currently being scheduled across the GCC this month.