Swicorp Wabel REIT’s IPO starts tomorrow on Tadawul

Swicorp Wabel REIT’s initial public offering (IPO) will start tomorrow on the Saudi Stock Exchange (Tadawul), with subscription for 15 working days until April 8.

The fund plans to distribute a net return on equity of 7.7 percent in 2018, 8.14 percent in 2019 and 8.30 percent in the year after, at a three-year average of 8.06 percent.

Swicorp Wabel REIT will offer 35.4 million units at SAR 10 per unit, totaling SAR 354 million. This represents 30 percent of the fund size of SAR 1.18 billion.

The sharia-compliant fund will be listed on Tadawul with a minimum subscription of SAR 500.   

The fund’s asset base includes four fully developed and income-generating shopping malls, namely the Al Makan Malls located in Riyadh, Tabuk, Hafr Al-Batin, and Dawadmi.

Swicorp said that most assets are located in cities with high demand for commercial and entertainment properties, mainly due to weak supply.

The shopping malls in the fund’s portfolio are newly built, with the oldest mall constructed in 2015.

The REIT fund aims to invest in various real estate properties across Saudi cities (except for Makkah and Madinah) that offer good infrastructure and a strong business environment.

Wabel Alarabia for Investment, the main owner of the fund’s assets, owns 23 shopping centers under the Al Makan Mall brand, including the fund’s four malls, with an occupancy rate of 96.38 percent.

The fund manager is also an investor in the fund through a cash subscription worth SAR 35.4 million, or 3 percent of the fund’s size.

Swicorp Company – a private financial services group licensed by the Saudi Capital Market Authority and Dubai Financial Services Authority – has been providing investment banking, private equity and asset management services in the Middle East and North Africa since 1987.