Addendum Announcement by the Saudi Economic and Development Securities Company (SEDCO Capital) Regarding the Announcement of a Specific Event Occurring on the SEDCO Capital REIT Fund

2021-02-23 15:51:36

Element ListExplanation
Announcement Detail Subsequent to the issued announcement by the Saudi Economic and Development Securities Company (SEDCO Capital) on 02 Jumad Al-Awal 1442H corresponding to (December 17th, 2020), SEDCO Capital, in its capacity as the Fund Manager of SEDCO Capital RIET Fund, would like to announce that the final verdict from the Appellate Court is endorsing the verdict to terminate the lease contract of Burj Al Hayat Hotel, Riyadh “the property” which ends on 9th December 2024. In addition, The Fund Manager would like to clarify the following points: 1. A judgment of the first instance has been issued by the General Court in Jeddah to terminate the lease contract of Burj Al Hayat hotel due to claims that the property has been underutilized due to the Riyadh Metro project and road closures in the area surrounding the property; 2. The Fund Manager filed the Statement of appeal during the statutory objection period where the judgment of the Appellate Court was issued confirming the first verdict; and 3. Accordingly, the Fund Manager submitted a reversal request to the Supreme Court in Riyadh to appeal the aforementioned decision due to the existence of several disciplinary offences regarding the confirmed ruling issued by the Appellate Court. Until further notice from the Supreme Court, The Fund Manager will continue to diligently assess several operational options and Value-add opportunities to enhance the performance of the property and minimize the financial impact of the current situation, which is deemed to be immaterial to the Fund’s total revenue. Currently, the Fund Manager is in discussions with several renowned hotel operators to structure a suitable arrangement in order to optimize the performance of the property at its full potential. At the current state, the Fund Manager is not in a position to quantify the financial impact from the current event until an agreement with one of the potential operators is defined. The Fund Manager will announce any new updates with regards to this matter as and when available.