SICO Saudi REIT initiates legal action against tenant to collect due rent

Logo of SICO Saudi REIT Fund

SICO Capital Co., the fund manager of SICO Saudi REIT Fund, announced initiating the legal proceedings against Eskan for Development & Investment Co., the master tenant of Eskan Tower 4 and Eskan Tower 6 in Makkah, according to a statement to Tadawul.

The move aims to collect the rent dues owed to the fund from Dec. 27, 2021, to protect the unitholders interests.

The relevant financial impact cannot be determined currently.

In December 2021, SICO Capital announced receiving a notice from Eskan Development, in which it expressed intent not to renew the lease contract, according to data available with Argaam.

As per the lease contract, the tenant has the right to cancel the contract after the lapse of five years from the start of the lease term on Dec. 27, 2017 (the initial term).

The lease contract states that the two parties have the right to cancel the contract after the initial term provided that a reasonable notice is sent one year (365 days) ahead of the end of the initial term. Accordingly, the contract term will end on Dec. 27, 2022.