Exclusive: Capri Capital Lands $2B Development Project in Saudi Arabia

Chicago-based Capri Capital Partners L.L.C. has inked a deal with Emaar, The Economic City Inc., a joint venture of Saudi Arabian general investment authority and Emaar Properties, to oversee the development of a $2 billion mixed-use project in Saudi Arabia. The development will combine commercial and residential properties and be located in the CBD of a new city called King Abdullah Economic City (KAEC). When complete, the new master-planned city on the Red Sea–up the coast from Jeddah, the commercial hub of Saudi Arabia–will include, besides the CBD, a 150 million-square-foot sea port, a 678 million-square-foot industrial zone, a resort of about 22,500 rooms, and a residential area with more than 150,000 apartment units. The CBD will total about 40.9 million square feet of office, hotel and other commercial space. Capri is the first international real estate investment company to be invited to invest in and oversee development within KAEC, though Emaar recently awarded Freyssinet Saudi Arabia a contract for the design and construction of the first phase of the Business Park within Bay La Sun Village, part of the residential development at KAEC. Capri’s project will include two five-star hotels, two office towers, a convention center with attached hotel, an enclosed mall and two condo buildings. Catalonian architect Ricardo Bofill of Teller de Arquitectura, a noted postmodernist, will design the project. Other works of his include Terminal 2 of El Prat International Airport in Barcelona, the Casablanca Twin Center in Morocco, and 131 S. Dearborn in Chicago. Prime Group, a development firm based in Chicago, will act as lead developer for the project.”The negotiations were a long and complicated process, just as they would be in any $2 billion deal,” Rehan Atiq, vice chairman & co-CEO of Capri Global Capital, told CPN this afternoon. “But it’s no ordinary development, since it’s part of essentially creating a city from the ground up.” The demand for the kind of properties that will be developed at KAEC already exists, he added. “Just in the case of hotels, Saudi Arabia doesn’t have enough rooms, and occupancies at the country’s existing properties are typically in the 90s.” As a whole, Atiq said, KAEC also represents an important new link between Saudi Arabia– which has had a history of relative isolation from the international community–with the rest of the word. “It’s a privately financed city, not a government project,” he said. “It says to the world that Saudi Arabia is an emerging market of considerable strength.”