Dar Al Arkan mulls to lure investors to Manhattan project: Chairman

Yousef Al Shelash, Chairman of Dar Al Arkan Real Estate Development Co

Yousef Al Shelash, Chairman of Dar Al Arkan Real Estate Development Co., said a consortium has been formed to develop a project on the land recently purchased in Jeddah for SAR 4.5 billion. The consortium includes Dar Al Arkan, DarGlobal, and the Trump Organization.

He expects the first phase of the new project, to be built on this land, to launch early next year.

In an interview with CNBC Arabia, Al Shelash said the project called Manhattan covers an area of one million square meters (sqm) on King Abdulaziz Road, near the Corniche. The project will feature serviced apartments, residential units, and offices, in addition to a green strip inspired by Central Park in New York. The project will be developed in three phases.

An investment fund will be established and offered to investors through a private placement, with a launch expected early next year, as project procedures have already begun, the Chairman said.

Regarding the undeveloped lands—approximately three million sqm north of Riyadh—that were previously announced, Al Shelash said they are currently in the final planning stages. Their planning programs are expected to begin, and the projects to be listed under the Wafi program, during the first quarter of next year.

On the five-year rent cap decision, Al Shelash stressed that most of Dar Al Arkan’s leased properties are commercial, while its residential portfolio is rented to institutions rather than individuals.

The company relies on long-term leasing contracts with institutions, companies, and government entities, which makes most of its leasing portfolio unaffected by the decision.

He also noted that the decision to allow foreign ownership of real estate in the Kingdom will boost demand, particularly from DarGlobal’s clients.

As for raising the foreign ownership of Dar Al Arkan’s shares, the Chairman clarified that the decision is still under study, and no specific percentage has been determined yet.

As for the sukuk program, Al Shelash stated that the company has issued more than 13 instruments over the past 20 years without restructuring any of them, having settled 11 so far. He affirmed the company’s ongoing commitment to meeting its obligations on time.

In February, Dar Al Arkan announced awarding a real estate deal in Jeddah through a consortium between the company, Kinzi Arabia, and a group of investors, valued at SAR 4.46 billion including tax and fees, according to Argaam data.

The company’s share in the purchased land amounts to 80%. The real estate developer completed all registration procedures and ownership transfer. The company looks forward to starting development work after obtaining the necessary regulatory approvals and permits from the relevant authorities.

It also announced that 2.83 million sqm of its land portfolio falls under the White Land Tax scheme.