Construction

Three Saudi companies acquire fund behind world’s tallest tower

July 22, 2024, 7:07 AM

Work began on Jeddah Tower in 2013 but the project has met many obstacles

Fund owns Jeddah Tower
Building will rise to 1,000m
Construction mired in controversy

The Saudi Arabian fund behind what will be the tallest tower in the world has been acquired in a $1.8 billion (SAR6.8 billion) deal.

Kingdom Holding Company, Sumuo Holding Company and Jeddah Economic Company (JEC) have signed an agreement to take ownership of the Al Inma Jeddah Economic Fund, which is currently wholly owned by JEC.

The fund’s Jeddah Tower will be more than 1,000m high. The surrounding development, located in the Obhur district in the north of the city, will measure an estimated 1.7 million square metres.

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It will include a Four Seasons Hotel, a shopping mall, commercial offices and luxury residential units.

A site nearby, which is part of the acquisition agreement, is being lined up for development later. The proposal includes towers, residential and commercial complexes, shopping, entertainment and tourism areas, as well as international hotels.

Kingdom Holding Company, led by chairman Prince Alwaleed bin Talal, will own 40 percent of the new fund, according to a note on the Tadawul exchange.

Construction of the tower began in 2013, but has been stop-start because of controversy over the contractors.

Work was paused in 2017, after only a few dozen floors had been built, when Prince Alwaleed and his chosen contractor, Saudi Binladin Group, fell out of favour during an anti-corruption campaign. Prince Alwaleed has always maintained he was innocent of any wrongdoing.

JEC was formed in 2009 as a joint venture among real estate and development companies. It is composed of Kingdom Holding Company, Abrar Holding Company, Qila’a Jeddah Company and Saudi Binladin Group.

Last September it was reported that building work on the tower had restarted, although confusion remained over the timeline for completion.

“It will happen but I’m not going to say it’s 100 percent,” an investment ministry official said in October.