Mazen Al-Ghunaim, CEO of Bidaya Real Estate Finance, confirmed in an interview with Al Arabiya that the company’s goal in issuing sukuk is to diversify its funding sources, to give it flexibility and many options.
It was expected that the year 2021 will record around 290,000 loan deals, considering that the warnings of a slowdown in the Saudi real estate financial market are out of place, and their origin is some new regulation, and the demand for real estate financing is still doing well.
Al-Ghunaim added that the company has 3 main strategies: The first is to create loan agreements and hold them until the end of the term for 20 years In media, the second is to create loan agreements and hold them for a specific period and then sell them to investors who want fixed-yield debt instruments while serving these portfolios.
Regarding the third strategy, the building contractor and the service, in which we address to budget major companies in Saudi Arabia or the government sector to help them establish real estate financing agreements.
He revealed that the company’s assets in management amounts to $ 1 billion, about 3.7 billion riyals, much of which is held in the company’s balance sheet, and 20% of the market share comes from the non-bank real estate finance sector.
He explained that the Saudi market is witnessing 16 real estate lenders, including 10 banks and 6 companies, and the share of the non-bank sector is up to 5%, compared to 95% in the banking sector, and due to the pandemic and support conditions. and many circumstances that have arisen in past, the number doubled after the Kingdom announced Vision 2030 and the industry saw 20,000 contracts a year turned into 20,000 contracts a month, multiplied by 10 times.
He talked about the companies’ efforts to deal with the fierce competition with banks in the real estate finance sector, explaining that the advantage of the companies lies in serving the client and betting on the sale of the loan agreements. in differently than banks that accept deposits and have several different financing resources, and for this reason the competition is fierce.
Read More About: Business News