Jabal Omar Development Company, the firm behind a SR19bn real estate scheme at Mecca, is set to complete a SR5bn ($1.3bn) loan by the end of June.
The firm is currently in talks with a group of seven banks, which will fund the 12-year loan. Five of the banks funding the loan have already provided a SR1.35bn bridge loan to the firm. Those banks are the local Al-Rajhi, which is also financial adviser to Jabal Omar, Saudi Hollandi, SABB, National Commercial Bank and Bank al-Jazeera. Two other local banks, Alinma and Al-Bilad, will also join the new deal.
The loan will be used to refinance the existing SR1.35bn deal and fund the development of the firm’s Mecca real estate project.
One source close to the deal says that talks between Jabal Omar and the banks are now in the final stages and that financial close on the deal should be reached in the next few weeks.
Jabal Omar has been working on raising long-term bank finance for the project for several years. The bridge loan was put in place in October 2010 and originally was set to expire in mid-2011 before banks granted an extension to get the longer term financing completed. The bridge loan now expires on 2 July.
The Jabal Omar development will consist of 37 towers when completed.