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Al Rajhi REIT

Al Rajhi REIT Fund is Al Rajhi Capital’s first Real Estate Investment Traded Fund (REIT) offering investors exposure to the Real Estate Market. Al Rajhi REIT Fund leverages the company's extensive experience in real estate sector and comprises of a well-diversified portfolio of real estate properties spread across multiple sectors in the Kingdom. As a listed and traded instrument, Al Rajhi REIT Fund offers a convenient way for investors to access real estate market by collectively owning these real estate properties generating periodical rental income, and with a potential to benefit from long-term capital appreciation.
 
Some of the salient features of the Al Rajhi REIT Fund are highlighted below.
  • Post the public offering, Al Rajhi REIT Fund is expected to be one of the largest REIT Fund in the Kingdom of Saudi of Arabia.

  • Offers investors an opportunity to take exposure to real estate market through a listed instrument.

  • Portfolio consist of 13 high quality income generating assets spread across multiple sectors.

  • Semi-annual distribution of at least 90% of net income (end of January and July each year).

  • Suitable to investors looking for regular income with long term investment horizon.

  • The Capital Market Authority has approved the public offering of “Al Rajhi REIT Fund” units in 18/12/2017.

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Why invest in Al Rajhi REIT?
  • Targeted Returns: Al Rajhi REIT Fund targets to generate net yield of 6.16% in 2018.

  • Periodic Dividends: Al Rajhi REIT Fund aims to distribute dividends semi-annually in January and July.

  • Diversified Portfolio: Al Rajhi REIT Fund portfolio consist of 13 high quality assets spread across various sectors like retail, education, logistics and offices, thereby enhancing benefits of diversification and minimizing concentration risks.

  • Steady Stream of Cash Flows: The portfolio’s Weighted Average Lease Expiry (WALE) term of 7.2 years ensures steady stream of cash flows from a medium to long-term perspective.

  • Liquidity: Al Rajhi REIT Fund will be listed and traded on the Saudi Stock Exchange (Tadawul). Ease of investing and divesting.

  • Professional Management: Dedicated team of investment professionals managing the portfolio with a goal to enhance investor returns and increase the REIT size with careful selection of quality assets.

Summary of the Offering :

Particulars Details
Fund Structure Close ended – Listed REIT Fund on Tadawul Stock Exchange
Minimum Investment Amount During Initial Public Offering SAR 1,000
Maximum Investment Amount per Investor During Public Offering SAR 60,000,000
Offering Period The offering period will be (10) business days, from January 1, 2018 to January 14, 2018, which may be extended
Unit Par Value SAR 10 per unit
Eligible Investors Saudis, GCC nationals, and Non-Saudi Nationals residing in Kingdom, Saudi And GCC Institutions, Qualified Foreign Investors as permitted under QFI regulations of CMA
Initial Public Offering (IPO) Amount SAR 426,701,300
No. of Units Offered to Public During IPO 42,670,130 units
Fund Capital SAR 1,222,006,090
Total Target Size of the Fund SAR 1,621,912,690
Value of In-Kind Subscription SAR 795,304,790
Total No. of Units in the Fund After the Offering 122,200,609 units
Total No. of Assets in the Fund  13
Weighted Average Lease Expiry Period 7.2 years
Lock-up Period Al Rajhi Capital (The Fund manager) owns 9.75 percent shareholding into the fund’s capital. This shareholding is subject to a two-year lock-up period from the date of listing (i.e. the Company cannot sell out this stake during the said period).
Properties’ Occupancy Level 98.93%
Targeted Net Yield in 2018 6.16%
Distribution Policy 90% of the fund’s net income will be distributed on a semi-annual basis
Management Fee 0.80% p.a. of the total fund value less expenses
Subscription Fee 2% of the investment value (charged at the time of subscription)

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Al Rajhi Capital announces the availability of Al Rajhi REIT semi-annual valuation reports as at 30th June 2018. The reports were conducted by Olaat Valuation Company, Barcode Company Limited and Valustrat Consulting who are all independent and licensed valuers, registered with the Saudi Authority for Accredited Valuers.
For additional information please contact  +966 92000 5856  

Legal Disclaimer
This document is produced by Al Rajhi Capital Company (ARC), an investment Company defined as an Authorized Person under CMAs Authorised Person Regulations with license number 07068/37, providing investment banking, asset management, securities brokerage, research, and custody services.
This document is prepared for information purposes only and does not constitute an offer to buy nor a solicitation to subscribe into the offered product, nor shall it form the basis of or be relied upon in connection with any contract or commitment whatsoever or any investment advice. Additional, Funds fees such as subscription fees, and management fees might apply.
Al Rajhi Capital is invested and may invest in the future in Al Rajhi REIT Fund or related securities, Al Rajhi Capital may have also provided within the previous 12 months signification advice or security business services to the issuer of the securities concerned or of a related security.
This presentation may contain forward-looking statements that involve assumptions, risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in historical performance forward looking statements as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, currency exchange rate, competition from similar developments, shifts in expected levels of property rental income and occupancy, changes in operating expenses, property expenses and governmental and public policy changes and the continued availability of financing in the amounts and the terms necessary to support.
Al Rajhi REIT's Fund future business and other risks that may have an adverse effect on the value and price of the Units. Investors are warned that changes in currency rates may have an adverse effect on the value, price or income of the securities invested in.
Illiquid securities in any market may be difficult to sell or realize the security and to obtain reliable information about its value or the extent of the risks to which the security is exposed. Past performance is not indicative of future returns. Investors are cautioned not to place undue reliance on these forward-looking statements, which are based on the Manager’s current view on future events. The value of financed or non-fiananced units if any in Al Rajhi REIT (“Units”) and the income derived therefrom, if any, may fall as well as rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the principal amount invested and investore might pay more than the invested amount.
The content in this document is for informative purposes of the product only. Investors should consult their own legal, financial and tax advisors prior to investing in securities, in order to make an independent determination of the suitability and consequences of an investment decision. Please note that different types of investments, contained within this document, involve varying degrees of risk and there can be no assurance as to any specific investment that may either be suitable, appropriate or profitable for a client or prospective client's investment portfolio, in particular, this document is not tailored to the investment objectives, financial position, risk appetite or other needs of any person who may receive this document.
If there is any discrepancy between this document and the Terms and Conditions of Al Rajhi REIT Fund the terms and conditions of Al Rajhi REIT Fund shall prevail. The information setout herein may be subject to updating, completion, revision, verification and amendment and such information may change materially.
Al Rajhi Capital Company (“ARC”), its directors, employees and/or affiliates makes no warranty, representation and/or undertaking whether expressed or implied, nor does it assume any legal liability whether directly or indirectly or responsibility for the accuracy, completeness and/or fitness for the investor purposes. This document and its underlying information may not be distributed or reproduced without ARC prior written permission. ARC does not and should not be seen as providing advice, whether legal, financial or otherwise by virtue of this document. To ensure proper understanding of Al Rajhi REIT Fund and its suitability, we urge you to seek professional advice from financial or legal professionals as the case maybe. 
 
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