Riyadh – Mubasher: SEDCO Capital REIT Fund’s board has approved the signing of a memorandum of understanding (MoU) to acquire a prominent office tower in Riyadh.
The transaction, valued at approximately SAR 707 million, marks a significant expansion of the fund’s real estate portfolio and includes a three-year mandatory leaseback agreement from the seller.
The target property is a newly developed office tower located in the Al Yasmin district of Riyadh. According to the disclosure, the building has completed its structural development and is currently in the final finishing stages. The acquisition encompasses a total land area of 8,037 square meters, with a substantial total built-up area of approximately 99,223 square meters, which includes integrated underground parking facilities.
Under the terms of the agreement, the seller has committed to a mandatory three-year leaseback period. This arrangement is expected to generate an annual rental income of approximately SAR 69 million.
Based on the projected acquisition price of SAR 707 million, the transaction reflects a gross yield of 9.8%. It is important to note that the stated purchase price excludes additional costs such as acquisition fees, transaction execution costs, and applicable taxes.
The completion of this acquisition is contingent upon the fulfillment of several regulatory and technical conditions. A primary requirement is the successful increase of the SEDCO Capital REIT’s total asset value through the issuance of additional units.
Furthermore, the deal remains subject to the completion of comprehensive legal, technical, and financial due diligence.
Regulatory oversight will play a critical role in the finalization of the purchase. SEDCO Capital must obtain formal approvals from the Capital Market Authority (CMA) and the Saudi Tadawul.
Additionally, the transaction requires the consent of the fund’s existing unitholders. The fund manager has stated that it will continue to disclose any material developments regarding the transaction in accordance with the relevant rules and regulations.
Starting in July, the fund’s unitholders will receive SAR 25.70 million in cash dividends for the first quarter (Q1) of 2026.
