Saudi tourism megaproject to close $ 3.7 billion loan | Salaam Gateway
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Posted on November 01, 2020 via Bloomberg Politics & Policy – Saudi Arabia’s Red Sea Development Co. plans to close 14 billion riyal ($ 3.7 billion) loan from five national banks by year-end as it ramps up construction of a luxury tourism project the size of Belgium, its leader said the executive.
The developer has been seeking funding for the project since last year, which spans dozens of islands off the kingdom’s west coast. Chairman and CEO John Pagano did not specify which banks would provide the loans.
So far, the company has awarded 7 billion riyals of contracts and plans to award a total of 15 billion riyals by the end of the year, Pagano said in an interview. A public-private partnership agreement for the project’s utilities is expected to be signed in a few days, and once it is in place and funding is secured, capital for the first phase of the project will be committed, he said. -he adds.
“We are now starting to ramp up our construction spending, so now is a good time to put the credit facility in place,” Pagano said.
Expanding tourism is a key goal of Crown Prince Mohammed bin Salman’s plan to transform the kingdom’s economy. Twin budget tensions created by the coronavirus pandemic and falling oil prices have not slowed work on two sprawling tourist developments on the Red Sea and an entertainment hub near the capital.
The Red Sea Development Co. project, owned by the Kingdom’s Public Investment Fund, is the largest recreation development, spanning over 25,900 square kilometers. Construction of a new international airport for the region has started and the company aims to open the first four hotels by the end of 2022 and 12 more the following year, Pagano said. This would complete the first phase of the project.
When the entire development is completed in 2030, it will target 1 million visitors per year, split evenly between national and international, he said.
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