Dar Al-Arkan International Sukuk Co yesterday listed its US$1bil Sukuk Al-Ijara on the Labuan International Financial Exchange (LFX) to finance housing projects in Saudi Arabia.
Dar Al-Arkan group managing director Abdullatif Abduallah Al-Shelash said the Islamic bond was arranged on behalf of Dar Al-Arkan Real Estate Development Co, one of the country’s leading developers.
“We are raising the sukuk for our two mid-income residential projects, a segment where we see further opportunity to develop. Many real estates in Saudi Arabia are done by individuals, thus they are scattered and unorganised,” he told reporters after the listing of the sukuk on LFX here.
Abdullatif said the company planned to build 12,000 mixed residential units for the two projects within 3½ years.
“We do not develop fully-gated communities, but semi-gated communities that are more accepted by the Saudis,” he said, adding that total revenue of about 11 billion Saudi riyal was expected from both projects.
Abdullatif said the company also aimed to build another 65,000 residential units in the next five years, but added that it was looking to venture abroad in the long run.
Launched last month, the sukuk issue was oversubscribed close to US$1.5bil, with response from institutions across West Asia, South-East Asia and Europe.
The Dal Al-Arkan sukuk is the largest listed on LFX, and is the second sukuk to be issued by the group after listing its first US$600mil issue on the Dubai International Financial Exchange.
At the same event, LFX board member Datuk Yusli Mohamed Yusoff said the listing of the Dar Al-Arkan sukuk on LFX showed the growing interest among investors from South-East Asia in West Asian instruments.
“We hope the listing of this sukuk on LFX will provide the platform to enhance the liquidity and trading of sukuk among international investors,” he said