$100m property firm unveiled

MANAMA — The Bahrain-based International Investment Bank (IIB) and its co-investors announced yesterday the formation of a $100 million Shariah-complaint real estate development company, Ewaan, which will initially focus on benefiting from the vast opportunities Saudi Arabia offers, before exploring wider horizons.

By From Our Correspondent

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Published: Wed 5 Jul 2006, 11:57 PM

Last updated: Sat 4 Apr 2015, 2:58 PM

The announcement was made at Ewaan's first founders' meeting, where the firm's strategic shareholders were also revealed following the strong oversubscription of the company.

Established by IIB in conjunction with its partners the Islamic Corporation for Development of the Private Sector (ICD), a multilateral investment affiliate of the Islamic Development Bank, and the Saudi Economic and Development Company (SEDCO), a Saudi-based investment group, Ewaan will focus on investment in the Saudi Arabian real estate market.

Based in Saudi Arabia, the new firm will seek to invest some SR2 billion ($533 million) in the fast-developing Saudi property sector over the next three years.

With the conclusion of the meeting, Ewaan will now move to acquire the requisite licences from the relevant authorities in Saudi Arabia to begin its investment activities.

According to recent projections, it is expected that over the next ten years, the gap between housing supply and demand in Saudi Arabia will reach some 1 million units, "and Ewaan believes that the mid-market segment represents a large proportion of this requirement," underlined the IIB's chief executive officer, Aabed Al Zeera.

Further commenting on the establishment of Ewaan, IIB's chief operating officer, Salah Nooruddin, said: "These trends create strong opportunities for companies such as Ewaan, which have the technical and market expertise as well as the financial strength to enter the Saudi market and effectively identify those segments and projects that can deliver superior returns. Over the next three years, the company intends to put strong inflows of investment towards the development of affordable housing projects in addition to other areas that can provide strong results for Ewaan and its shareholders."

The Internal Rate of Return (IRR) for investment in the company is expected to be in excess of 22 per cent per annum over a three to five-year period. Further, there is scope for significantly enhanced returns through capital appreciation at exit should the company be floated through an Initial Public Offering (IPO), it was highlighted.

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