A new US $1.1bn mixed-use development will be developed following a partnership between the King Salman Park Foundation and Saudi developer Naif Al Rajhi Investment Company. Unveiling the project, the Foundation said this was the first public-private partnership project managed and funded entirely by the private sector.
Spread over a 290,000sqm area within the Park premises, the project will feature over 1,500 residential units that will include Salmani-style apartments and townhouses overlooking the park. In addition, it will boast 140,000sqm of gross leasable areas for offices and retail, hotels, schools, and several educational, health, sports, recreational and social facilities.
According to the Foundation, the office spaces will feature central Grade A and flexible office options, fully blended within residential plots, while the hospitality offerings will cater to business tenants and park visitors. Retail space will be distributed throughout the public realm, covering the essential needs of residents, it stated.
“This partnership represents a major milestone for us. We are thrilled to launch this unique collaboration and excited to work alongside our partners and investors and all those involved in making our ambitious vision a reality. The creation of the fund is a sign of our ongoing commitment to creating a world-class destination that will enrich the lives of residents and visitors alike, and build a legacy of urban regeneration project for generations to come,” said George Tanasijevich, CEO of King Salman Park Foundation.
According to a report, Saudi Fransi Capital is the fund manager, while King Salman Park Investment and Real Estate Development Company is the master developer, and Naif Al-Rajhi Investment Company is the real estate developer and master lessee of the project. The fund’s working mechanism is said to be a model of cooperation between public and private entities, with the latter responsible for managing and financing the fund. It focuses on the development of the first real estate investment in plots of land in the park.
This partnership is unique, linking key partners and the fund’s capital structure to create an innovative risk and reward proposition for both equity and debt stakeholders, balancing the King Salman Park project’s long-term and projected capital returns with a consistent and regular income flow in the short and long term, said a top official.
Saudi Fransi Capital CEO Salam Alkhunaizi noted, “We are privileged to be part of the iconic King Salman Park project through the launch of this fund. We are hoping to provide a pioneering model on how public-private partnerships can work profitably and effectively for all, especially in implementing and managing a huge and exceptional project such as King Salman Park.”