Description of the Event:
Mulkia Investment announces signing a buying agreement acquire a “hotel apartments” building in Namuthagiyah district, Riyadh city, and the acquisition price is 50,000,000 Saudi Riyals.
The real estate property is a “3 stars” hotel apartments building with a total building area of 11,613 square meters and 128 furnished units, the building includes a basement, ground floor, three repeated floors and the annex with all the furniture and equipment.
After transferring the ownership of the real estate property, a 10 years committing agreement will be signed with the First Room Hotel Company with a net annual yield of 10% of the acquisition price. The lease is supported with 10 promissory notes each represent one year rent as guarantees to cover the complete rent period.
The Impact Caused by the Event:
1- The lease agreement will be effective from 01/01/2020.
2- The acquisition will be through the available financing facilities.
3- The fund aims to achieve its strategy and the expansion plan through the acquisitions of constructed developed real estate properties to generate periodic and rental income inside the Kingdom of Saudi Arabia, which shall be reflected positively on the fund’s net income and cash dividends due to the difference between the income generated from acquired properties after deducting the related expenses and the financing cost.