Banan’s unit signs SAR 110.4M sports club deal with Armah

Logos of Banan Real Estate Co. and Armah Sports Co.

Banan Real Estate Co. subsidiary and Armah Sports Co. signed a contract to develop and lease a sports club in Al-Qirawan, Riyadh, for SAR 110.40 million (excluding VAT).

The contract, with a binding term of 20 years, was signed by Armah and Emaar Al Waseel Al Mutamayza Co.

Under the agreement, Emaar Al Waseel will develop its land in Al-Qirawan into a fully equipped, ready-to-operate sports club, excluding movable furniture and sports equipment, the two listed companies said in statements to Tadawul.

Armah will lease the club for 20 years under a long-term agreement, which commences on the handover of the completed, operations-ready facility.

The club, located on Prince Musaed bin Jalawi Road, would be developed in accordance with specifications and designs prepared and approved by Armah.

The men’s club will operate under Armah’s “B_FIT” brand, offering fully integrated facilities and a range of technology-enabled solutions designed to enhance the overall fitness experience.

Armah said the project is part of its strategy to diversify funding sources for its expansion plans and supports its business strategy of expanding through prime locations to achieve its targeted growth and returns.

Banan noted that the annual lease payments will amount to SAR 5.52 million, excluding VAT.

Given Banan Real Estate’s 60% stake in Emaar Al Waseel, the company is expected to generate rental income once the project is completed, in addition to direct revenue from the development work.

The project is expected to be completed within 24 months.

Armah expects the contract to have a financial impact upon completion and commencement of operations.