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SEDCO Capital REIT Fund's board has approved signing a memorandum of understanding (MoU) to acquire an office tower in the Al Yasmin district of Riyadh for an expected transaction value of SAR 707 million. The proposed acquisition includes a mandatory three-year leaseback arrangement by the seller, with the property expected to generate annual rental income of around SAR 69 million. The transaction is part of the REIT's strategy to strengthen its portfolio with income-generating commercial assets, subject to the completion of the acquisition process and required approvals.
SEDCO Capital REIT Fund has approved the signing of a memorandum of understanding (MoU) to acquire an office tower in Riyadh's Al Yasmin district, further expanding its portfolio of commercial real estate assets.
The fund said the board approved the proposed acquisition with an expected transaction value of SAR 707 million. As part of the agreement, the seller has committed to a mandatory leaseback arrangement for a period of three years after the transaction is completed.
The office tower is expected to generate annual rental income of approximately SAR 69 million during the leaseback period, providing the fund with a stable income stream from the asset.
The acquisition remains subject to the completion of the transaction process and the execution of definitive agreements. REITs typically pursue such acquisitions to enhance recurring rental income and diversify their investment portfolios with high-quality commercial properties.
The proposed purchase comes as Riyadh continues to witness strong demand for premium office space, supported by business expansion, government-led economic diversification initiatives, and the relocation of regional headquarters by several international companies. These factors have contributed to rising occupancy levels and increased investor interest in commercial real estate across the Saudi capital.
Source Reuters
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