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Press Releases |
SHUAA Capital Saudi Arabia and Rotana Hotel Management Corporation sign master agreement to develop hotel properties in Saudi Arabia through the SHUAA Saudi Hospitality Fund I Riyadh, June 15, 2008: SHUAA Capital Saudi Arabia, cjsc (SCSA), the Saudi Arabian subsidiary of SHUAA Capital psc, announced today that it has signed a master agreement with Rotana Hotel Management Corporation LLC (Rotana), a leading Pan-Arab hotel management company that operates various 5-star, 4-star, 3-star hospitality properties, furnished apartments, and resorts throughout the Middle East and North Africa. SCSA recently launched a SR 2 billion (US$533 million) Shari’a compliant closed-end fund under the name ’SHUAA Saudi Hospitality Fund I’, which aims to develop and own seventeen hotel properties, furnished apartments, and resorts across the Kingdom of Saudi Arabia comprising 5,000 rooms. SHUAA Saudi Hospitality Fund I is managed by SCSA and will also own 20% of a new company in the Kingdom that will manage and operate the properties on an exclusive basis. This new company will be managed by Rotana. Earlier this year, both SHUAA Capital psc and Rotana have committed to invest in the SHUAA Saudi Hospitality Fund I through a parent regional hospitality fund, the US$200 million SHUAA Hospitality Fund I that was established by SHUAA Capital psc. Omar Al Jaroudi, Chief Executive Officer of SCSA and Selim El Zyr, President and Chief Executive Officer of Rotana signed the agreement in Riyadh. The signing ceremony was attended by Majid Saif Al Ghurair, Chairman of SHUAA Capital, Tariq AlMutlaq, Chairman of SCSA, Nasser Al Nowais, Chairman of Rotana, Iyad Duwaji, Chief Executive Officer of SHUAA Capital, and other senior officers from both SHUAA and Rotana. Mr. Omar Al Jaroudi said: “We expect the Saudi Arabian economy to continue to grow at recent rates, and with further liberalization, we believe that demand for modern hotel facilities by both business travelers and visitors will continue to increase. This joint venture with Rotana confirms our commitment to the Saudi market, and represents a unique opportunity for Shari’a compliant investors to access the hospitality sector which otherwise is seldom part of their portfolio.” He noted: “We are delighted to be associated with Rotana, a leading hotel chain that has gained regional and international recognition during the past few years. The Fund, which is supported by our Saudi shareholders, who represent leading business groups in the Kingdom, aims at developing and owning a well diversified investment portfolio of hospitality properties. It will be managed by a team of highly experienced professionals at SCSA and supported by professionals at SHUAA Partners, the private equity arm of SHUAA Capital, in the United Arab Emirates” he added. Commenting on this announcement, Mr. Selim El Zyr said: “Today’s announcement is a significant step, not only towards fulfilling our aggressive growth strategy for the region, but also for Rotana’s expansion within the Saudi market. We are privileged to be partnering with SCSA in this Fund and we are certain that the development of these seventeen properties and Rotana’s marketing strategies will complement the ongoing efforts of the Kingdom of Saudi Arabia in increasing its focus on the development of its tourism industry. Our objective is to develop and manage international quality hotel properties which will cater to the needs of the local and regional market, the international traveller and the niche markets that are looking at the cultural heritage aspect of the Kingdom”. Diab Chidiac, Director of Real Estate of SCSA, said: “SHUAA Saudi Hospitality Fund I has been designed to yield optimal financial returns through the deployment of its investments in the six Saudi cities that are most undersupplied with hotel rooms and serviced residential facilities. Moreover, the Rotana brands featuring high margin, high return hotel categories will add supreme value to the Fund’s portfolio.” Mr Ziad Al Tunisi, COO of Al Faisaliah Group said: “We truly believe the Kingdom of Saudi Arabia is in dire need of modern hospitality properties in all categories. In addition to the current shortages, the hotels developed by the SHUAA Saudi Hospitality Fund I will come online as brand new properties 4 years from today, at a time when the existing stock of hotels will have aged even further. Through this enterprise, the Saudi Hospitality Fund will participate in the modernization and opening up of the Kingdom to the business and family tourism travelers." SCSA has been marketing the SHUAA Saudi Hospitality Fund I since 18 May, 2008. The SHUAA Saudi Hospitality Fund I which is expected to have its initial closing on 18 June, 2008, has seen strong response from both institutional and individual investors across the region.
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