The act underline the Kingdom\u2019s commitment to making its capital market a key funding source for development
\n riyadh
\nSaudi Arabia has announced a landmark decision allowing foreign investment in listed companies that own real estate within Islam\u2019s holiest cities, Makkah and Madinah. The move, unveiled by the Saudi Capital Market Authority (CMA), aligns with the Kingdom\u2019s Vision 2030 strategy to diversify its economy and attract foreign capital.
\nEffective immediately, foreigners can invest in shares or convertible debt instruments of companies owning property in these sacred cities. However, foreign ownership is capped at 49% of a company\u2019s shares, and strategic foreign investors are prohibited from holding stakes in these entities.
\nThe CMA stated the initiative aims to stimulate investment, enhance the capital market\u2019s competitiveness, and provide liquidity for ongoing and future developmental projects in Makkah and Madinah. These reforms support the Kingdom\u2019s ambition to reduce reliance on oil revenues and boost foreign direct investment (FDI), with a target of $100 billion by 2030.
\nThe pilgrimage sector, a significant contributor to Saudi Arabia\u2019s economy, plays a central role in this effort. In 2019, the Kingdom earned approximately $12 billion from Hajj and Umrah, and it aims to welcome 30 million pilgrims annually by 2030.
\nThe CMA highlighted that foreign investment in Makkah and Madinah\u2019s real estate sector is part of broader reforms, including allowing non-Saudis to invest in the Saudi stock market, access swap agreements, and directly acquire debt instruments. Previously, in 2021, the CMA permitted non-Saudis to subscribe to real estate funds focusing on properties in the two cities, paving the way for this recent development.
\nWhile foreigners remain restricted from directly owning property in the holy cities, they are allowed to lease properties under specific conditions. This reform aims to align Saudi Arabia with neighboring countries that allow foreign property ownership in designated zones.
\nThe announcement sparked a positive reaction in the stock market. Real estate firms with significant holdings in Makkah and Madinah saw their share prices surge. Knowledge Economic City\u2019s stock rose by 9.89% to SR16.66 ($4.44), Jabal Omar Development Co. increased by 10% to SR25.85, and Makkah Construction and Development Co. climbed by 9.84% to close at SR106.
\nThese measures underline the Kingdom\u2019s commitment to making its capital market a key funding source for developmental projects, enhancing its appeal to regional and international investors, and strengthening the local economy.<\/p>\n","protected":false},"excerpt":{"rendered":"
The act underline the Kingdom\u2019s commitment to making its capital market a key funding source for development riyadh Saudi Arabia has announced a landmark decision allowing foreign investment in listed companies that own real estate within Islam\u2019s holiest cities, Makkah and Madinah. The move, unveiled by the Saudi Capital Market Authority (CMA), aligns with the […]<\/p>\n","protected":false},"author":2,"featured_media":458043,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":{"0":"post-458026","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-world"},"yoast_head":"\n