Derayah REIT to secure SAR 600 mln loan from Riyad Bank

Derayah REIT Fund has inked a memorandum of understanding (MoU) with Riyad Bank to secure a sharia-compliant loan facility at SAR 600 million, Derayah Capital, the fund manager said in a statement.

The loan tenure will extend for seven years, and will be repaid in semi-annual installments, provided that a sum of SAR 250 million will be paid in the sixth year and a sum of SAR 350 million will be paid in the seventh year.

The loan facility will be used to buy yield-generating properties, in line with the fund’s income diversification strategy. In addition, loan facilities will likely increase the fund’s cash dividend payment, the fund manager added.