RIYADH: Retal Urban Development Co. on Wednesday signed a shareholder’s agreement with Saudi Arabia Railways Co. to create a special purpose vehicle to establish a commercial mall, the developer said in a statement to Tadawul.
The urban developer Retal is a subsidiary of Alfozan Holding based in AlKhobar, Saudi Arabia.
It is recognized for creating urban projects that enhance the quality of life through progressive concepts and lasting design
The total project value of completed, ongoing and upcoming projects is currently at SR9.5 billion. According to the company’s website, the company has completed 6,000 units, while nearly 7,000 are under construction.
“The shared SPV plans to establish a commercial mall to develop the business and growth of Retal’s strategy,” the real estate firm said in the statement.
An SPV is a subsidiary established by a parent company to isolate financial and legal risks through ring-fencing specific assets and liabilities.
In accordance with the rules and regulations issued by the Capital Market Authority, there are four reasons for establishing SPVs.
These are financing through alternative sources, assigning the issuance of debt instruments to SPVs specifically, providing the legal personality for the investment fund and protecting investors’ rights from bankruptcy.
“We are already witnessing a huge demand for high-quality developments in desirable destinations across the country, and we anticipate this demand to continue, driven by strong economic trends, favorable long-term demographics, and Saudi’s commitment to transform the real estate landscape and improve the standard of living in the country,” Retal CEO of Retal Abdullah bin Faisal bin Abdulaziz Al-Braikan said on the company’s website, adding: “With Retal’s robust strategy, expertise, and financial strength, we are poised to capture these exciting opportunities while delivering excellent value to our shareholders.”
Saudi Arabia Railways Co. is one of two governmental companies managing the Kingdom’s rail network alongside the Saudi Railways Organization.
It offers transportation and logistics solutions to meet the aspirations of its clients and investors to attain economic development and social welfare, according to its website.
