Controls on the Ownership of Real Estate in the Kingdom by Listed Companies, Investment Funds, and Special Purpose Entities

For the purpose of applying these Controls, the following words and phrases, wherever mentioned in these controls, shall have the meanings ascribed thereto, unless the context requires otherwise:

• Real Estate Ownership by Non-Saudis Law: The Law of Real Estate Ownership by Non-Saudis issued by Royal Decree No. (M/14), dated 19/1/1447H.
• Controls: The special controls on the ownership of real estate in the Kingdom—including the cities of Makkah and Madinah—by listed companies, investment funds, and special purpose entities, in accordance with Article 4 of the Law of Real Estate Ownership by Non-Saudis.
• CMA: The Capital Market Authority.
• Foreign Strategic Investor: The foreign strategic investor in accordance with the Rules for Foreign Investment in Securities.
• Listed Companies: A company listed in the Saudi Stock Exchange established in accordance with the Companies Law.
• Investment Funds: a collective investment scheme aimed at providing investors therein with an opportunity to participate collectively in the profits of the scheme which is managed by a fund manager for specified fees.
• Special Purpose Entities: an entity established and licensed under the Rules for Special Purposes Entities.
• Capital Market Institutions: a person authorised by the Authority to carry out securities business.​
  

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​​​A) Listed companies, investment funds, and special purpose entities may own real estate or acquire other real rights over real estate, in the Kingdom—including the cities of Makkah and Madinah—in accordance with these Controls.
B) When listed companies own real estate or acquire other real rights over real estate located within the borders of the cities of Makkah and Madinah, such real estate must be allocated to their headquarters or the headquarters of their branches, and the property must be fully used for such purpose.
C) By way of exception from Clause (B) of this Article, listed companies may own real estate or acquire other real rights over real estate located within the borders of the cities of Makkah and Madinah for a purpose other than the purpose described in Clause (B), provided that the following conditions are met:

1. The foreign strategic investor shall not own – at all times – the shares of the listed company or the convertible debt instruments of the company.

2. ​The ownership of natural and legal persons jointly who do not hold Saudi nationality shall not – at all times – exceed 49% of the shares of the listed company or the convertible debt instruments of the company.​
   

D) Capital Market Institutions may accept subscriptions from natural and legal persons who do not hold Saudi nationality in investment funds that invest part or all of their assets in real estate located within the Kingdom, including the cities of Makkah and Madinah.

E) Investment funds and special purpose entities must comply with the Law of Real Estate Ownership by Non-Saudis and its Implementing Regulations when dealing with in-kind redemption requests or upon the termination or liquidation of the fund.

These Controls shall enter into force in accordance with their approval resolution.​​