Al Mashaar REIT exempts rent for Eskan Development from March 15 to Dec. 31

Al Mashaar REIT Fund’s board of directors decided, on Nov. 18, 2020, to exempt Eskan Development & Investment Co., a tenant, from rent for the period from March 15 to Dec. 31, 2020, the fund manager Muscat Capital said in a bourse statement.

This came after the fund manager conducted an assessment of the real estate market in Makkah, in addition to an internal study of Eskan Development’s financial statements.

Muscat Capital took into account the negative conditions of the real estate market in Makkah, resulting from COVID-19 precautionary measures, temporary suspension of Umrah and visit visas, and the financial difficulties that affected Eskan Development, which were beyond its control.

The fund manager received a letter from the tenant, confirming its commitment to pay the rent for the year 2021 and the resumption of the fixed contract concluded between the two parties.

Eskan Development also committed to pay the rent due for the period from Jan. 1 to June 30, 2021 in advance in early 2021.

Muscat Capital expects that the rent waiver for the period from March 15 to Dec. 31, 2020 will have a negative impact on Al Mashaar REIT’s cash flows.

Moreover, the resumption of the rent payment according to 2021 contract will have a positive impact on the fund’s cash flows during the year. Muscat Capital, announced in July 2020, that Al Mashaar REIT Fund received a notification from Eskan Development requesting the re-assessment of the due rents of the second installment for 2020, according to data compiled by Argaam.