Al Hammadi Gets SAR 79.8M for Riyadh Land Expropriation

Al Hammadi Holding Co. received a compensation notification from the Royal Commission for Riyadh City (RCRC) worth SAR 79.76 million for land the government expropriated in Riyadh. The expropriated plot covers 9,669 square meters.

The company disclosed the notification in a filing to the Saudi stock exchange Sunday. Al Hammadi said the compensation covers the land's value and related costs. The company did not specify the exact location of the plot or the timeline for payment.

Land expropriations are routine in Riyadh as the city expands under the RCRC's urban development mandate. For Al Hammadi, the SAR 79.8 million payment represents a non-operating cash inflow that could offset near-term capital spending. The company operates hospitals and medical centers across Saudi Arabia, with its main Riyadh facilities near the expropriated zone.

The compensation amount is material relative to Al Hammadi's market capitalization of roughly SAR 5.5 billion. The company's last annual report showed property, plant, and equipment of SAR 1.2 billion, meaning the expropriation covers about 6.5% of that base.

Al Hammadi shares traded flat on the Saudi exchange Sunday, suggesting the market viewed the notification as a routine administrative event rather than a strategic shift. The company did not indicate whether it plans to reinvest the proceeds or hold them as cash.

The RCRC has been active in land acquisition for infrastructure projects tied to Vision 2030, including transport corridors and mixed-use districts. Expropriation compensation in Saudi Arabia typically follows a valuation process based on market rates and development potential. Companies that receive such payments often book them as other income, with no direct impact on recurring revenue.

Al Hammadi's next quarterly filing will show the compensation line item and any associated costs. The company has not guided on the timing of the cash receipt.