Jabal Omar sells assets worth SAR 6 bln to Alinma Investment

Jabal Omar Development Company (JODC) has sold some of its assets at the Makkah development project to Alinma Investment Co. at a total value of SAR 6 billion, the company said in a statement to the Saudi bourse.

The assets included three hotels (Makkah Conrad, Hilton Makkah, Hyatt Regency Makkah) and Al Khalil Shopping Center.

The latest deal is part of Jabal Omar’s five-month memorandum of understanding (MoU) that it signed with Alinma Investment last August to set up a fund to sell and lease back the properties.

Alinma will re-lease the assets to Jabal Omar for 10 years, while the developer will retain the right to re-purchase these assets after five years from the fund’s 10-year term.

The fund is set to acquire some of Jabal Omar’s Makkah-based income-generating assets, which include a total of five hotels and four shopping centers.

Jabal Omar said it will use some of the sale proceeds to settle its bank loans, while the remaining cash will be used to fund the projects. It also expects a positive impact to reflect on financial statements of the current fiscal year.