Saudi Arabia: The Saudi sovereign wealth fund has unveiled major investments, including a 30 percent stake in Masdar Building Materials Co. and a $1.5 billion ($400.5) contract to develop the Riyadh Sedra community.

The announcements were made during the Public Investment Fund’s Private Sector Forum, held from Feb.12-13 in the Saudi capital.

The partial acquisition aligns with the Kingdom’s efforts to increase private sector participation in its economic diversification initiatives, with the wealth fund playing a central role in this transformation to achieve the goals of Saudi Vision 2030. The construction, building components, and services sector is a priority due to its crucial economic contribution.

In a statement, PIF said the move aims to strengthen Saudi Arabia’s leading position in the sector to meet current and future demand. 

PIF seeks to reinforce local supply chains, prioritize strategic products and services, and localize advanced technologies and expertise.

Ahmad Al-Ghamdi, head of construction and building materials, MENA Investments at PIF, stated that the investment in Masdar will strengthen local supply chains by enhancing capabilities in the construction, building components, and services sector, which is one of PIF’s strategic focus areas.

“The investment will also support the development of the building materials distribution network, increase access to value-added services, and accelerate digital transformation through the adoption of the latest technologies and solutions.” Al-Ghamdi said.

He added that the financial backing also represents another step toward promoting partnerships with the private sector to develop strategic industries and increase the Kingdom’s gross domestic product.

Faisal Al-Muhaidib, Masdar CEO, said: “As a leading building and construction materials company in Saudi Arabia, we look forward to partnering with PIF to play a vital role in supporting the growth and development of the sector by scaling up our capabilities and meeting current and upcoming demand.”

The CEO added that the construction, building components and services sector is one of the most vital and promising in the Kingdom. PIF’s investment will accelerate his company’s growth, enabling it to expand its capabilities and strengthen its leading position by offering products through its distribution network.

PIF said that the acquisition of the local company specializing in the trading and distribution of building materials is through a capital increase by subscribing to newly issued shares, according to its statement released on Feb. 12.

The wealth fund added that the investment will enable Masdar to transform its operations through digital technology, improving customer experience and operational efficiency. Additionally, it will help Masdar expand its operations, build new strategic partnerships, and increase the role of local suppliers and businesses in the building materials market.

PIF-Backed ROSHN secures $400M in development contracts

During the forum, Saudi Arabia’s giant property developer and PIF company ROSHN signed contracts worth SR1.5 billion to develop the SEDRA integrated residential community in the capital city.

These include an SR650 million contract with SARH ATTQNIA Co. to develop 968 housing units and an SR720 million deal with the Chinese construction company HCE to build luxury units within the eight-phase SEDRA project, which was announced in 2021.

The project spans 20 million sq. meters and is plans to provide over 30,000 private homes as part of the Kingdom’s broader urban development and housing initiatives. 

In August, ROSHN opened sales for 1,251 new homes as part of the fourth phase of the project, which expands the flagship development by 1.8 million sq. meters, featuring homes near the natural wadi integrated into the SEDRA masterplan, following high demand and sales for homes in the community, according to the company.

In October 2023, the property developer launched the sales for the third phase of the project, introducing 3,438 new residences and a wide range of amenities.