Musharaka REIT inks SAR 400 mln facility with Al Rajhi Bank

Musharaka REIT on Wednesday signed an agreement with Al Rajhi Bank to obtain facilities worth SAR 400 million, with a six-month SAIBOR rate plus 1.85 percent.

The facilities were granted in line with the standards of the bank’s Sharia board, Musharaka said in a statement to Tadawul.

The loan, which is guaranteed by a promissory note and a pledge on properties, will remain valid for seven years, with financing costs only to be paid throughout that period.

The facility will be used for financing the fund expansions through acquisition of income-yielding properties and long-term usufructs, in line with its investment strategy.

The target acquisitions are likely to reflect positively on the fund's net income and cash dividends after deduction of annual financing charges.

The drawdown period is 18 months from the date of signing the deal, the fund added.