SEDCO Capital REIT signs MoU for SAR 707M Riyadh office tower

SEDCO Capital, the manager of SEDCO Capital REIT Fund, said it signed a non-binding memorandum of understanding on June 28 to acquire an office tower in Riyadh for SAR 707 million. The announcement came without a seller name or a timeline for a final deal.

The REIT, listed on the Saudi stock exchange, has built a portfolio of income-generating real estate across the kingdom. Adding a Riyadh office asset would deepen its exposure to the capital's commercial property market, where vacancy rates have tightened and rents have risen as government and private-sector demand runs ahead of new supply.

An MoU at this stage signals intent, not certainty. The REIT still needs to complete due diligence, negotiate a binding sale and purchase agreement, and secure any required shareholder or regulatory approvals. The structure of the acquisition – whether funded by debt, equity, or a mix – could affect the fund's distribution yield going forward.

SEDCO Capital REIT did not say whether the tower is occupied or part of a development project. Office assets in Riyadh have attracted strong interest from both domestic and foreign investors in recent years, especially in prime locations such as the Diplomatic Quarter and the King Abdullah Financial District.

The fund reported net assets of about SAR 1.6 billion as of its last annual report, meaning the SAR 707 million price tag would represent a significant addition to the balance sheet. Investors will watch for further details on the property's valuation, rental income, and how the deal fits with the REIT's stated strategy of targeting stable cash flows.