Saudi Arabia’s REDF signs deal to refinance $2.6bn real estate portfolio
Funding partnership agreement will enhance the financial sustainability of the fund
The Real Estate Development Fund has announced the signing of a funding partnership agreement, a first of its kind, with the Saudi Real Estate Refinance Company (SRC) to refinance a real estate portfolio owned by the fund with a total value of $2.66 billion.
A statement explained that the agreement aims at enhancing the financial sustainability of the fund, increasing the liquidity of the housing real estate financing market in the kingdom, reducing financing costs for Saudi households, and increasing the percentage of housing ownership among Saudi families to 70% by 2030, in a bid to realize the targets of the Saudi Vision 2030 programme.
The agreement was signed by REDF CEO Mansour bin Madi and SRC CEO Fabrice Susini in the presence of Minister of Municipal and Rural Affairs and Housing and Chairman of the Board of Directors of REDF Majid bin Abdullah Al Hogail.
Bin Madi said that the agreement was part of REDF’s strategy that supports the future goals and plans of REDF to offer diversified housing finance options in the housing real estate financing market, with the aim of meeting the needs of “Sakani” beneficiaries, as part of the subsidized real estate loan program.
The funding partnership with SRC, he stated, will enable the fund to realise its targets and enhance the sustainability of supporting Saudi families through designing new programmes and initiatives that accord with the future stage of REDF after adopting its new bylaw, and to continue offering monthly housing subsidies for beneficiaries of the subsidized loan programme to enable future generation to secure housing.
He also pointed out that the fund has also provided more than $8.26 billion as monthly subsidies for over 560,000 beneficiaries between June 2017 and the third quarter of 2021.
REDF offers loans with subsidised profits of up to 100% with a value of SR500,000 to meet the needs of Sakani beneficiaries, ranging from subsidised real estate loans to benefit from various options ranging between self-construction, buying ready housing units or those under construction, in partnership with more than 18 financing institutions.
Susini added that the agreement seeks to increase supplies of real estate loans for housings within the company’s vision to develop a secondary real estate market that serves the growth of the kingdom’s housing sector to enable Saudi families receive a proper housing in realization of targets of the Saudi Vision 2030.
He also expressed pride in signing the biggest partnership agreement worth $2.66 billion to increase the opportunities of the growth of the real estate finance market in Saudi Arabia through innovating low-risk tools in partnership with financing institutions.
