The Saudi subsidiary of Kuwait-based Global Investment House has formed a tie-up with a Saudi property developer to launch a real estate fund.
Mosa bin Abdulaziz Al Mosa & Sons Group will act as strategic partner in the venture while Global Saudi, the subsidiary, will be the fund manager.
The firms say the fund will invest in real estate units in sectors and regions with high demand and low supply.
“The real estate market has achieved high levels of growth over the past years thanks to the domestic demand for residential and commercial construction projects,” says a statement from Global Investment House. “The real estate sector, which represents more than 4% of the kingdom’s GDP, is expected to continue its growth.”
Saudi investors, like those elsewhere in the Gulf, have traditionally favoured real estate and real estate funds over other forms of investment such as equity or bond funds.
The need for housing, commercial property and infrastructure for Saudi’s expanding economy has helped real estate investors generate good returns in recent years. Government spending is behind many of the projects.
©2015 funds global mena