Jabal Omar concludes $1.3bn hotel towers funding
Club of six local banks arranges long-term finance for huge project
Jabal Omar Development has announced that it has gained approval from a club of local banks for a syndicated loan of $1.33bn (AR: 5bn).
The company told the Saudi Arabian stock exchange, Tadawul, that it had gained approval from the six participating banks - including Al Rajhi Bank, Bank Al Jazira, National Bank, SABB Bank, Bank Al Bilad and Saudi Dutch bank - for the loan.
The money will be used to build the ten new hotels it is planning on 2.2 million m2 near to the Grand Mosque in Makkah. The hotels are expected to be managed by international brands such as Marriott International, Hyatt Hotels, Hilton Hotels and Sheraton.
It provides a 12-year financing package for the project and replaces a $360m bridging loan which had been put into place to allow work to get underway.
Jabal Omar Development Co is a special purpose vehicle set up to redevelop key sites in Makkah. In total, it is planning around 38 new hotel towers and a giant shopping mall for the site as part of a $5.3bn set to develop over five phases.
Some 20% of the company's shares are owned by its founders, and another 10% are owned by Makkah Construction & Development Co.
The company was advised on the fundraising by Al Rajhi Capital.