Riyad REIT unveils material development

Riyad REIT Fund signed an agreement on Oct. 10 to sell Al-Shatea Tower in Dammam for SAR 71.5 million, excluding real estate transaction tax, after obtaining board approval to finalize the sale.

The fund acquired the property in 2016 for SAR 97 million and generated rental revenue of SAR 52.33 million until June 30, 2024, according to a statement to Tadawul.

According to the latest financial statements, the property's average valuation amounted to SAR 90.27 million, while its book value stood at SAR 89.01 million, leading to a recorded loss of SAR 17.51 million.

The sale transaction will provide financial flexibility, helping the fund improve its financial position and enhance asset quality. Proceeds from the sale will be allocated for various purposes, including the partial repayment of bank facilities to reduce financial obligations and the enhancement of existing property quality, which is expected to increase returns and improve performance in the medium to long term.

No related parties are included in the deal, the statement added.