Dr. Abdulrahman Al Tasan, CEO of RIKKA, opened his heart to Amlak and talked about his visions and outlook for the real estate reality in the Kingdom. opened his heart to “Amlak” and talked about his visions and his view of the real estate reality in the Kingdom, and expected a limited decline in real estate prices in some areas of the Kingdom whose prices have reached a limit that is not feasible to invest in, but he saw that all real estate in the Kingdom still has opportunities and prices are considered reasonable to some extent ... He revealed that all Saudi banks mortgage the land that lends its owner, but they mortgage it in the name of a board member of the bank so that it is easy to sell when the borrower defaults on repayment.He said that Saudi society still prefers villas to apartments in search of independence and privacy, and advised to own housing and that each person chooses what suits his income ... He touched on talking about the company's projects inside and outside the Kingdom and we enjoy his spaciousness, his smile and his beautiful smile for us when he is surprised by some strange questions and he answered all our inquiries spontaneously and spontaneously ... and many issues raised in this interview. Let's follow the details:

[First of all, we would like you to give the kind reader a brief overview of Rekka. Reka Company was established in 1982 as a multidisciplinary company in the field of real estate investment, and the search for very special opportunities, and the company is keen on creativity and innovation in the implementation of its real estate projects, and the company practices each specialization through an independent company with limited liability, with total investments of one billion and 500 million riyals, and its headquarters in Riyadh. Our Projects:
The start of the company's projects in Tabuk was through the Tabuk Mall project, which is a commercial center, then the project of the hotel villas complex in Riyadh, which was sold completely.
Currently we have two large projects in Al Reem Island in Abu Dhabi, which are two residential towers and commercial services.
In Al Thumama in Riyadh we have a condominium project whose name we have not settled on yet.
285 luxury residential villas (it is a closed residential neighborhood with all high-end services such as entertainment - clubhouse - and is aimed at an upper-middle class segment and contains green spaces) Villas range in size from 500-750 m2.
The project is located northeast of Riyadh near Khuzam Road in Thumama, 500 meters before the Thabat project, and all the streets that surround the project are considered above 50 m. The length of the complex is 1.30 km on an area of 400,000 m2.

[What executive actions have taken place so far on the Al Thamamah project? Now we are about to finalize the designs for the infrastructure where the site will be fully developed with all advanced services.

[Will the entire project be sold and who will operate it in case of sale? We plan to sell part of it and the other part will remain a long-term investment for the company through leasing. The company will operate the project and the sale price will be inclusive of operating and management fees for a period of 3-5 years after which it will be inclusive of service provision fees.

[Is the company selling the entire project and who will operate it?

[Is the company selling the units off-plan? Yes, now we have started selling in our project in Abu Dhabi off-plan and the project is now in the construction stages for the ground floors.

[What about mortgage and real estate financing? The mortgage is still unclear and has been submitted to the Council of Ministers and returned to complete some notes on it and the market is awaiting its issuance. As for real estate financing, it will be one of the few options that help others to obtain affordable housing in light of the economic conditions and high house prices, but it is also linked to a large extent to the mortgage.

Housing crisis

In fact, there is a crisis and need for housing, which is tangible and real as a result of migration from small cities to large cities, which will continue due to the search for work, but with the trend towards building universities outside major cities, this will contribute to reducing migration to the city of Riyadh to provide work and study opportunities in those areas.

What is the potential for housing in Riyadh?

[What about the potential of local banks and their ability to finance real estate? Saudi banks have high liquidity compared to international and foreign banks and the volume of lending relative to deposits is small, and most depositors do not take interest on their deposits, so liquidity is available at local banks.

[Will the pending mortgage system encourage banks to lend? Have you sold properties with mortgages? All of our banks mortgage the land not in the name of the bank but in the name of a member of the bank's board of directors in order to make it easier to claim and sell it when the borrower fails to fulfill the debt, and when the land is sold by the bank, it receives only what it has lent, and there are sales made with mortgages, but they are few, and are often resolved amicably between the bank and the borrower.

The delay in the introduction of the mortgage system was in the interest of reflecting on the causes and repercussions of the mortgage crisis in America, which was the direct cause of the outbreak of the global financial crisis, so the occurrence of the crisis provided an opportunity for the decision maker in the Kingdom to reflect on the crisis and the need to clarify the rights of both parties in a more specific manner.

So we find that in America and Europe there has not been a great expansion in real estate lending, and the exposure of borrowers and lenders alike caused the crisis in the form we saw, so we saw the phenomenon of (1 dollar home), so that he buys the house with what is and what is not for one dollar.

We believe that there will be a real estate correction during the coming period in European, American and foreign real estate, and as for what we find of the impact of commercial real estate, in those countries, it is due to the desire of companies to reduce their large stores and branches due to the decline in sales resulting from the consumer's caution and conservatism in reducing spending with the lack of jobs, which directly affected the retail sales of those companies and it is natural to act by closing branches that are not economically feasible and thus the nearby stores are affected.