Albilad Fund of REITs Funds’ initial public offering (IPO) has started today, Mar. 4 and will run until May 3, the fund manager, Albilad Capital said in a statement.
Last month, Saudi Arabia’s Capital Market Authority (CMA) approved Albilad Capital's request to offer, register and list units of the new fund on the Saudi Stock Exchange (Tadawul).
The fund manager said it is planning to raise a minimum of SAR 50 million, adding that raising the target amount ahead of the IPO closing date will allow Albilad Capital to launch the new vehicle immediately.
The fund aims to capitalize on volatility in REIT prices after listing to generate capital gains and pay competitive dividends. It also aims to build a diversified portfolio of REITs, which pay competitive cash dividends, when compared to the average of listed peers.
Investments will be distributed among several REITs based on feasibility, so as to limit the risks of focusing on a single fund management, Albilad Capital added.
The performance of REITs will be always monitored by Albilad’s research team to ensure maintaining the best positions in the REIT market.
Albilad Fund invests in real estate funds operating in Makkah and Madinah.
Eligible investors are Saudi individuals as well as wholly-owned institutions and as well as government entities, the statement added.
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Albilad Fund REIT - Details |
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Fund structure |
Albilad Fund of REITs Funds |
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Investment objective |
Invest in capital in the medium-to-long term, pay biannual dividends through investments in Tadawul-listed REITs or offered ones. The fund will also invest the available liquidity in the money market instruments and money market funds, including Albilad Capital’s funds. |
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Fund’s target size |
SAR 50 mln |
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Unit price |
SAR 10 |
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Minimum subscription |
SAR 500 |
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Fund manager |
Albilad Capital |
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Custodian |
Riyad Capital |
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IPO period |
From March 4 to May 3, 2018 |
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Fund term |
Not determined |
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Financing policy |
The fund manager can secure Sharia-compliant financing at 10 percent maximum of the total value of the fund’s assets, in case the yield of an investment opportunity is likely to exceed the funding cost. |
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Dividend policy |
The fund will pay all dividends from REITs to unit holders at the end of April and August every year.
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