Foreigners can now invest in Makkah and Madina real estate market

Foreigners can now invest in Saudi Arabia's real estate market through listed companies that own properties in Islam’s two holiest cities, Makkah and Madina. However, this investment opportunity is limited to purchasing shares of publicly listed companies or convertible loans.

The Saudi Capital Market Authority (CMA) on Monday introduced regulations to govern this initiative, which are already being implemented.

The CMA stated that allowing foreign investment in real estate companies operating in Makkah and Madina aligns with Saudi Arabia's economic strategy. The move aims to boost foreign investment and strengthen the real estate sector, particularly in the holy cities.

This initiative is expected to accelerate development projects in Saudi Arabia, with a special focus on real estate growth in Makkah and Madina.

Read: Saudi Arabia to introduce 'electric jet' service to transport pilgrims to Makkah

Additionally, the decision is a significant step under Vision 2030, the Kingdom's ambitious reform plan to attract foreign investment, reduce reliance on oil revenues, and diversify its economy.

The CMA emphasised that foreign investment in companies owning properties within the boundaries of Makkah and Madinah will be subject to specific rules.

Under these regulations, foreign investors can purchase shares of Saudi companies listed on the local financial market or invest in debt instruments that are convertible into shares.

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However, strategic investments will remain off-limits to foreign investors.

Furthermore, the total ownership of foreign individuals and entities in any listed company cannot exceed 49% of the company’s shares, as per the CMA’s guidelines.