Al Tayyar Travel Group on Thursday signed an agreement with Albilad Capital to set up a private real estate investment fund, managed by the latter.
Tadawul-listed Al Tayyar will contribute six of its properties in Riyadh and Jeddah as an in-kind contribution to develop mid-market hotels, it said in a bourse statement.
The agreement is valid for 24 months from the signing date, the statement added.
The hotels are expected to be operated under the Comfort and Quality brands owned by Choice International Co., Al Tayyar also said.
The step comes in line with Al Tayyar's strategic transformation plan announced last December, which includes two main goals for the hotel division: providing the company with fixed cash flows and taking advantage of new opportunities in the mid-market hotel segment.
These assets are intended to generate fixed cash to finance investment in other business sectors.
Al Tayyar added that it is working with Albilad Capital, the fund manager, to complete required procedures.
Last September, Al Tayyar announced that its board of directors had approved participating in the establishment of a private real estate investment fund to develop mid-market hotels.
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