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Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), has launched a new real estate company to develop and operate staff accommodation for major construction and development projects across the kingdom.
The new company, Smart Accommodation for Residential Complexes Company (SARCC), is poised to address the increasing need for innovative housing solutions within both public and private developments in Saudi Arabia.
PIF said SARCC will be instrumental in leading the evolution of the accommodation market by developing and operating complexes for staff in Saudi Arabia. It will seek opportunities to invest in the sector in order to strengthen standards for staff housing.
SARCC will stimulate Saudi Arabia’s private sector by encouraging sustainable investment and collaboration throughout the industry’s supply chain. This includes partnering with service providers from various sectors, such as construction, catering, transportation, and retail.
PIF said the launch of SARCC will bolster its infrastructure and services related to construction and real estate projects throughout Saudi Arabia, including the ROSHN Group, Saudi Downtown Company, and New Murabba Development Company.
“The staff accommodation market represents a significant opportunity due to growing demand in the local market,” said Khalid Johar, co-head of the Local Real Estate Portfolio Department at PIF.
Johar said SARCC will play a pivotal role in meeting the increasing demand for accommodation solutions in Saudi Arabia amid an increase in construction projects across the kingdom.
Meanwhile, PIF is central to Crown Prince and Prime Minister Mohammad bin Salman’s plans to diversify the economy away from reliance on oil revenues by building new industries and investing in infrastructure development projects.
Since 2017, the $925bn sovereign fund has created 95 new companies and over 644,000 direct and indirect jobs. PIF seeks to foster growth in various promising sectors and boost local content by forming strategic partnerships with the private sector. The fund plans to inject a minimum of SAR150bn annually into the local economy.
The state investor swung to a profit of $36.81bn (SAR138.1bn) in 2023, while its total revenues more than doubled to $88.3bn from $44bn a year earlier.
With a portfolio of investments ranging from date farms to multinational conglomerates, PIF’s sources of funding include retained earnings from investments, capital injections from the government, government assets transferred to the fund, and loans and debt instruments.