The Red Sea Development Company, which is developing a tourism project on the kingdom’s Red Sea coast, announced on Wednesday that it has reached financial close on its 14.12 billion Saudi riyal ($3.76 billion) term loan facility and a revolving credit facility with Saudi banks.
The finance was handled by Banque Saudi Fransi, Riyad Bank, Saudi British Bank, and Saudi National Bank, according to a statement from the firm.
The loan was the first riyal-denominated green finance credit facility, and it would be utilized to build the first phase of the Red Sea project, according to the statement.
“This year, we continued at a rapid pace with the delivery of our flagship project, all the while aware of our promise to not just minimize our environmental footprint but actively produce a 30% net conservation benefit by 2040,” stated John Pagano, CEO of the Red Sea Development Company.
“With our financial structure in place, we will continue to focus on project execution and delivery, which is on track to welcome the first guests by the end of this year.”
The Red Sea Development Company, which is completely owned by the kingdom’s Public Investment Fund, was formed to spearhead the Red Sea Project’s development.
The concept is a premium, regenerative tourist destination that intends to raise the bar in sustainable development and put the kingdom on the map of global tourism.
“We are delighted to have completed the first ever riyal-denominated green financing for our initial phase… “With this… our project acquires further credibility in the market and increases its attractiveness to investors,” said Jay Rosen, Red Sea Development Company’s group chief financial officer.
Saudi Arabia, the world’s largest oil exporter, is swiftly modernizing its economy in order to lessen its reliance on oil, foster local businesses, increase employment, and diversify revenue.
The Arab world’s greatest economy, its tourism initiatives include Qiddiya, a massive entertainment and sports project, and Neom, a $500 billion futuristic metropolis on Red Sea islands that includes a natural reserve, coral reefs, and cultural sites.
The Red Sea Project anticipates that the first tourists will arrive by the end of this year, when the first hotels open. The first phase, consisting of 16 hotels, will be completed next year.
The project, which is expected to be completed in 2030, would feature 50 resorts with up to 8,000 hotel rooms and more than 1,000 residential buildings spread among 22 islands and six inland areas. An international airport, luxury marinas, golf courses, and entertainment and recreational amenities will also be part of the destination.