Riyadh – Mubasher: Saudi Fransi Capital, a subsidiary of Banque Saudi Fransi (BSF), on Sunday announced the launch of its Islamic Shariah-compliant Real Estate Investment Traded Fund (REIT) on the Saudi Stock Exchange (Tadawul).

The initial public offering (IPO) of the fund will begin on Sunday, 15 April through Thursday, 3 May.

The Bonyan REIT Fund’s projected net yield is 7.8% per annum over a four-year period starting at 7.3% in 2018 and growing to 8.2% by 2021.

With a capital base of SAR 1.629 billion, the Bonyan REIT Fund will be one of the largest REITs on Tadawul, the investment firm revealed, noting that the IPO size amounts to SAR 651.5 million, representing 40% of the total size of the fund.

The company added that the remaining 60% of Bonyan REIT’s units will be retained by Abdulrahman Saad Alrashid & Sons with a lockup period of one year.

“This is the second such product being introduced by Saudi Fransi Capital, the first one being “Taleem REIT” which was the first Specialty REIT in Saudi Arabia investing in educational properties and the first REIT with quarterly dividend payments,” the firm said in a statement.

Units in the Bonyan REIT Fund will be offered to the public at SAR 10 per unit, with a minimum subscription set at SAR 1,000, Saudi Fransi Capital stated.

Units will be offered through five receiving banks, namely: BSF, Al Rajhi Bank, National Commercial Bank (NCB), Riyad Bank, and Samba, in addition to the fund manager itself, Saudi Fransi Capital.

Bonyan REIT Fund commences listing on Tadawul with an initial portfolio of 10 assets, including three mega malls, a strip mall, three hotels, two residential compounds and a residential building in CityWalk Dubai.

This five-city portfolio aims to provide investors with diversification across geography, sector, and size.