Saudi sovereign fund sets up real estate unit to meet housing demand

Riyadh

SAUDI Arabia's sovereign wealth fund, the Public Investment Fund (PIF), has set up a new real estate subsidiary called Roshn to help meet increasing local demand for housing.

Saudi Arabia has already spent billions of riyals in recent years to provide housing, but a slump in oil prices has curbed government finances and pushed it to seek private sector partnerships to help diversify its economy.

PIF gave no details on how much it envisaged spending on the new initiative or how many houses would be built.

It said that Roshn aimed to increase strategic partnerships with real estate investors and support the development of the contracting sector through the adoption of modern and innovative technologies.

"We are proud to launch Roshn, a national company specialised in developing modern residential compounds, as part of PIF strategy to develop (Saudi's) real estate market," it said in a tweet on Wednesday.

The Saudi government wants to increase activity in the real estate market and increase home ownership to 70 per cent by 2030, from a figure which official statistics put at 62 per cent at the end of 2019.

The objectives are part of the housing goals attached to the Vision 2030 reform programme promoted by Crown Prince Mohammed bin Salman.

PIF, which manages more than US$300 billion in assets, has investments in domestic mega-projects including the US$500 billion NEOM economic zone, the Red Sea tourism project, and Qiddiya, an entertainment development that will include a Six Flags theme park.

Roshn will focus on nine cities in four main regions: Riyadh, Eastern Province, Mecca and Asir. REUTERS