Saudi PIF to manage delayed King Abdullah Financial District

Saudi Arabia’s Public Investment Fund (PIF) has finalized a deal to take over the management of the unfinished $10 billion King Abdullah Financial District (KAFD) in Riyadh, in a bid to revive the project, Bloomberg reported on Tuesday, citing unnamed sources.

The Saudi sovereign wealth fund will take control of the financial hub from the Saudi Public Pension Agency, and appoint Hilmi Ghosheh as the head of the financial hub, it was reported.

Construction of the 73-building KAFD began in 2006, but the project was plagued by delays and cost overruns, and struggled to find tenants.

In May last year, it was reported that PIF would likely make a $7.9 billion (SAR 30 billion) offer to purchase the district.

The deal would include a new company to oversee the project’s completion and added costs for undeveloped plots.

HSBC Holdings Plc’s local unit was advising the pension agency on the sale of KAFD, while JPMorgan Chase & Co. was working with the PIF, sources told Bloomberg last November.

Saudi Crown Prince Mohammed Bin Salman has listed the rehabilitation of the hub as one of his objectives in the Kingdom’s Vision 2030 economic reform plan.

The first phase of the district will open next year, and Saudi Arabia plans to host the G-20 meeting there in 2020.