Enma AlRawabi buys Riyadh land for SAR 180M; terminates lease

Enma AlRawabi Co. and Al-Motaqadimah Schools Co. decided to terminate by mutual consent the lease for the Hittin land in Riyadh. The contract was signed on Oct. 1, 2018.

The lease terminated after Enma AlRawabi bought the buildings on the land for SAR 180 million, excluding taxes, it said in a statement to Tadawul.

The Hittin land holds an education complex, the statement said, adding that there is no revenue from the buildings as they are under construction and in final phases.

A loan for SAR 170 million will finance the transaction, through a mortgage on the Hittin land. The remaining SAR 10 million will be paid from the company’s own resources.

Through the transaction Enma AlRawabi seeks to optimize the use of the property by increasing the performance efficiency of the company’s real estate portfolio.

Optimum and best use of the property will reflect positively, through an increase in the non-current assets in the balance sheet for 2024 and the likelihood of increasing the rental revenues of the property.

There are no related parties to the deal, the statement said.

The contract for purchase of the buildings from Al-Motaqadimah Schools is considered as the termination of the lease signed between the two companies on Oct. 1, 2018, with a term of 25 years ending Jan. 31, 2044.