RIYADH: Saudi developer Dar Al Arkan said first quarter net income more than doubled as it boosted margins on property sales.
Net income jumped by almost 130 percent to SR28.5 million ($7.6 million) compared to a year earlier, the company said in a stock exchange filing on Sunday.
Overall sales dipped by about 6.4 percent to SR554.8 million. Despite a drop in leasing revenue and an increase in finance costs, the property company was able to offset the impact by reducing its operating costs. Saudi property developers are benefiting from a boom in mortgage lending across the Kingdom, which is fueling the construction of tens of thousands of new homes. Earlier this month, the developer said it was selling villas co-branded with Elie Saab, the Lebanese designer.
The villas will be located in its upmarket Shams Ar Riyadh project. The project is located north of Riyadh, on the King Khalid Road, extending over an area of more than 5 million sq. m.
Faisal Durrani, head of Middle East Research at Knight Frank, said: “Like other global economies, the pandemic has driven a widespread economic slowdown across the Kingdom.
However, improved business confidence during the closing months of 2020, underpinned by economic reforms linked to Vision 2030 and the rapid response to COVID-19, has helped to drive a turnaround in performance in all main segments of the real estate market.”
In the grade A office market, rents experienced fragmented performance in the Kingdom’s three main centers, with rents in Riyadh increasing marginally by 0.5 percent to SR1,465 ($390.67) per square meter during the first quarter, while in Jeddah rents fell 2.8 percent to SR1,008 per square meter.