Musharaka Financial Company, as the fund manager of Musharaka REIT, announces that in light of the governmental measures previously taken to limit the spread of COVID-19, including the suspension of certain activities, the closure of shopping malls, and a 24-hour curfew, the company acknowledges the Kingdom of Saudi Arabia’s efforts to address the ongoing global crisis and prays for the safety of the country and its people.
Regarding the impact on Musharaka REIT, the majority of the fund’s properties have not been significantly affected, particularly those under long-term binding lease agreements. However, some sectors, such as retail, have faced challenges. Fortunately, the fund’s shopping centers have played an important role in easing the burden on city residents (Riyadh, Dammam, Jubail, and Al-Khobar) by providing essential goods through open hypermarkets and delivery services from operational restaurants.
Event Description:
Musharaka Financial Company has recently received requests from some tenants asking for rent deferrals or reductions for properties that constitute less than 20% of the fund’s income. However, this does not necessarily mean a corresponding reduction in income. Several requests have been rejected, and the company is currently reviewing the remaining requests to determine appropriate actions in accordance with Saudi regulations to ensure the best interests of the unit holders are protected. In the event that precautionary measures extend beyond the first half of the year, the impact on the fund’s revenue may increase.
Impact of the Event:
Given that the COVID-19 crisis is still ongoing, it remains difficult to predict when it will end or to determine its full negative impact on the fund. However, the fund manager affirms its commitment to safeguarding investor interests by continually monitoring market developments, implementing necessary measures, and announcing any significant changes as needed to ensure the fund’s continued success and the prosperity of its tenants.