Muslim investors from around the world, including some from the United States and Europe, have leased units in the largest housing complex on Earth. The properties at Makkah in Saudi Arabia are among the costliest in the world, with a unit measuring just 35 square foot costing SR1.8 million (Dh1.8m).
The $2 billion (Dh7.4bn) Abraj Al Bait development, part of King Abdul Aziz Endowment for the Two Holy Mosques project, will allow Muslims from around the world to lease property close to the Haram Mosque for 25 years for the first time.
Saudi property laws prevent non-nationals from owning real estate at the holy cities of Makkah and Medinah. Non-Muslims are not allowed to enter the cities.
Eighty per cent of the Almarwa Tower, the first building in the project, has already been sold, said an official from the Saudi bin Ladin Group (SBG). The company is developing the project and has exclusive rights to market and lease the properties around the world.
Residents will be able to pray in their rooms and some will have views of the Kaaba.
The project will eventually comprise seven towers, each named after an Islamic term such as Safa, Marwa and Sara. The total floor area of the development will be 15,600,000 sq ft.
“This is the first project in Makkah where Muslims from other countries can lease property,” said Ghazi Naif Abdulbari, Makkah Branch Manager of Saudi bin Ladin Group subsidiary Jiwar Real Estate Management and Marketing.
“Fifty per cent of the investors are Muslims from Saudi Arabia and other Gulf countries – the UAE, Oman, Kuwait, Qatar and Bahrain. The remaining units have been leased to Muslim investors from other countries. Investors from the US, the United Kingdom, India, Malaysia and other countries have invested in the project.”Investors will be given multiple-entry visit visas, not residential visas. “The price of a unit with a Haram Mosque view is SR2.3m and units with a Kaaba view cost SR3.2m,” added Abdulbari.
“The main feature of this project is that for the first time in history it gives the Muslim community throughout the world an opportunity to lease property at Makkah for 25 years. Other projects in Makkah such as Zam Zam Tower are time-share schemes and investors can buy an Islamic lease bond that lasts 24 years,” he said.
The 27-floor Almarwa Tower will contain 1,080 housing units, with 45.97 per cent offering views of the Kaaba and 53.87 per cent having views of the Haram Mosque.
There is an acute shortage of accommodation for pilgrims visiting Saudi Arabia for Haj and Umra and this has pushed up prices.“One night’s rent for a single room in Makkah during the first 10 days of Ramadan is SR25,000 and it goes up to SR40,000 per night from day 20 to day 30. All rooms in Makkah and Medinah are booked six months in advance for the Haj season. Investor,s who have bought property in the new project, can stay in these rooms when they visit the holy sites for Haj, Ramadan or Umra or lease them to other pilgrims. Our company will lease these properties on behalf of overseas investors,” said Abdulbari.
Makkah receives more than five million pilgrims every year and the number is expected to exceed eight million by 2010. There are 2,000 hotels, including 10 five-star properties, and 7,000 other places to stay, and occupancy reaches 100 per cent rate during Haj and Ramadan seasons.http://www.business24-7.ae/Articles/2008/11/Pages/PropertyinvestorsflocktoHolyCities.aspx