JEDDAH – The developer of AlAhli SEDCO Residential Development Fund has already acquired a 100 percent interest in a 25,934 square meters residential development site located in the Al-Salamah 2 district of Jeddah 6 months ahead of schedule, NCB Capital, the GCC's leading provider of wealth management services and Saudi Arabia's largest asset manager, said. The site is ideally suited for the development of a medium density residential apartment project and is in accordance with the investment criteria of the Fund. Investors have been quick to recognize the potential of AlAhli SEDCO Residential Development Fund since it is structured to address the acute shortage of reasonably affordable residential accommodation for middle and upper income home buyers. NCB Capital has announced that subscription period will close soon as target amount is near complete. Furthermore, investor confidence is strengthened by the fact that fund combines the expertise of two of the Kingdom's most highly esteemed companies; NCB Capital as the fund manager and SEDCO Development which is responsible for managing and conducting the development project. The Fund provides investors with capital growth by purchasing land plots in Jeddah for development, construction and sale of residential apartments targeting the middle and upper income segments of the population. Minimum subscription is SR50,000 and the Fund aims to have an internal rate of return of 10 percent per year. Development of the site will help to alleviate the shortage of housing units in Jeddah where residential market-gap is estimated to be 21,000 units per year. Giving an extra boost to the fund's potential, real estate financing is expected to increase by 60 percent during 2014-2019E to SR 210 billion, while the introduction of the Mortgage Law is expected to further drive demand since, with banks now offering mortgage finance schemes to home buyers, many young Saudis are finding it possible to shift from renting to home ownership. In launching the AlAhli SEDCO Residential Development Fund, NCB Capital is making a patriotic response to the call from the Government of the Custodian of the Two Holy Mosques, King Abdullah bin Abdulaziz Al-Saud, for the private sector to play a greater role in facilitating homeownership for Saudi citizens. — SG
