MSGA unit to set up real estate fund for land development in Riyadh 

MSGA expects the agreement to have a positive impact on its financial results during 2027 and 2028

MSGA Investment Co. announced that its subsidiary, MSGA First Real Estate Development Co. (as the developer), signed an agreement with Dinar Investment (as the fund manager) and Asar Investment Co. (as the landowner) to establish a private closed-end real estate investment fund to develop a land plot in Al Wisam district in Riyadh.

According to a statement to Tadawul, the fund is expected to have a target size of approximately SAR 700 million and develop around 1,000 residential units.

The parties agreed to value the land at SAR 259.62 million, excluding real estate transaction tax and brokerage fees. Development fees will not exceed 15% of total development costs, with final terms to be determined under the development agreement.

The agreement will remain valid for 90 days from the signing date or until the completion of the fund establishment procedures, whichever comes first, with the possibility of extension by mutual written agreement.

Under the agreement, Dinar Investment will establish the fund structure, prepare the required documentation, privately place the fund units, complete all regulatory requirements, and manage the fund until its liquidation.

Meanwhile, MSGA First Real Estate Development will prepare the project's execution plan, including development costs, timelines, designs, and proposed master plans, in addition to undertaking the development after obtaining the necessary approvals and permits.

The details related to land transfer, development activities, and development fee entitlements will be governed by the final agreements.

MSGA expects the agreement to have a positive impact on its financial results during 2027 and 2028, following the completion of the fund establishment process, execution of final agreements, and fulfillment of regulatory requirements.

MSGA noted that the agreement sets out the preliminary principles and arrangements for establishing the fund, while all final details regarding the fund, land transfer, and development activities remain subject to the fund terms and related definitive agreements. The company said it will disclose any material developments in due course.