In a strategic investment initiative, Gulf Finance House B.S.C. (GFH), one of the leading Islamic investment banks and Kuwait’s premier financial institution, Kuwait Finance & Investment Company (KFIC) today jointly announced opening subscriptions in a new KD80 million investment product to fund the development of Jordan Gate and Royal Village, two crucial components of the US$1 billion Royal Metropolis project in the Hashemite Kingdom of Jordan.
Subscriptions in the new investment product are offered through a capital increase of Kuwait-based Bayan Holding Company K.S.C. (c), with the exclusive aim of offering lucrative investment opportunities to investors through investing in blue-chip real estate projects in Jordan.
Unveiling the details of the investment offer, Mr. Esam Janahi, Chief Executive Officer of GFH said: “Jordan Gate and Royal Village are two salient and innovative components of the Royal Metropolis project which will certainly add value to the booming real estate sector of Jordan and its economy.”
“In line with GFH’s philosophy of maximizing investor returns, the Bayan Holding Co. investment product will present an exclusive growth avenue for regional investors who are keen to tap the potential of the Kingdom’s real estate market,” he said.
“Jordan Gate and Royal Village will significantly enhance Jordan’s potential as a global business destination and will suitably leverage the Kingdom’s strategic location in the Middle East and the forward-looking dynamic economic vision of the Government of Jordan,” Mr. Janahi said.
The foundation stone for Jordan Gate, the first phase of the Royal Metropolis project was laid by His Majesty King Abdullah II in May this year. Royal Village is a significant component of the second phase of the Royal Metropolis – `The Districts.’ GFH has earlier announced forging partnerships with KFIC and Greater Amman Municipality to develop Jordan Gate, while Royal Village will be developed jointly by GFH and KFIC.
“Construction work on Jordan Gate has already commenced while we are targeting to commence pre-selling of the residential village of Royal Village by the fourth quarter of this year. The potential of both these projects have already attracted a number of investors who have expressed their keenness to participate in the investment offer,” Mr. Janahi added.
Subscriptions will be offered at a price of KD 0.110 per share and the minimum investment limit has been pegged at 100,000 shares. Bayan Holding Co. will develop the projects through two Jordanian private shareholding companies – Jordan Gate Company PSC and Royal Village Company PSC.
Commenting on the investment offer, Mr. Abdul Rahman Al Jasmi, Deputy Chief Executive Officer of GFH, said: “The investment offer follows the recent strategic agreement between GFH and KFIC for developing Jordan Gate and Royal Village. As a joint initiative, it draws upon the collective expertise and market knowledge of GFH and KFIC.”
“The investment offer endorses GFH and KFIC’s commitment to structuring attractive investment products that support regional growth. It also reflects GFH and KFIC’s overall strategy of maximizing clients' wealth and shareholder gains,” he added.
GFH and KFIC will each invest up to KD5 million in the issue. Post-placement, each will hold a 6.18% stake in the company. The balance 87.64% will be held by investors. While Bayan Holding Company will invest 100% in Royal Village Company PSC, it will hold 89.62% in Jordan Gate Company PSC, with the balance 10.38% being taken up by Greater Amman Municipality.
Explaining the growth potential and prospects of the Jordanian real estate market, Mr. A. Rahman Al-Saeed, Managing Director and Vice Chairman of KFIC, said: “Jordan’s economy is one of the fastest growing in the Middle East, projected to grow at around 6% in 2005 and 2006. Real estate is booming with a growth rate of 30%. Jordan Gate and Royal Village are well positioned to take advantage of these favourable factors, while targeting a niche market sector.”
He added Bayan Holding Co will offer more investment products linked to the Jordanian real estate market in the days to come. “We are confident of making Bayan Holding Co. a profitable entity by next year that can subsequently help in the listing of Bayan Holding Company’s shares on the Kuwait Stock Exchange (KSE) by early 2007. The cash flows generated will increase the probability of shareholder dividend distribution and the possibility of contemplating new real estate investment opportunity in Jordan.,” Mr. Al Saeed said.
Both Jordan Gate and Royal Village will be developed in prime locations. Jordan Gate is being developed at the 6th Circle in Amman and will occupy one of the highest points in the city and on completion will be visible from every part of the capital. The components of Jordan Gate will include – Hilton Amman -- a luxurious five-star hotel and two high-rise towers offering prime office space connected to a shopping mall and a services area.
Royal Village will comprise of a gated residential community with approximately 400 villas and 600 apartments. It will also have a high-end boutique shopping mall, a school and a number of parks. Royal Village will be developed in Marj Al-Hammam along the main highway to the Dead Sea.
© 2005 Al Bawaba (www.albawaba.com)
