KEC and Kaden Sign MoU for SAR 2.5 Billion Mixed-Use Project in Madinah

Knowledge Economic City Company (KEC) has signed a Memorandum of Understanding (MOU) with Kaden Investment Company to develop the Multaqa Al Madinah 2 mixed-use project in Madinah, with the total project cost initially estimated at approximately SAR 2.5 billion. The proposed development will be located immediately north of the first phase of the Multaqa Al Madinah project, overlooking King Abdulaziz Road and adjacent to the Boulevard at Knowledge Economic City. Under the MOU signed on September 7, 2026, KEC and Kaden will establish a framework for developing the project, which will serve as an integrated extension of the existing Multaqa Al Madinah destination. The project will be developed on a land area of approximately 92,043 square meters, with an estimated total Gross Floor Area (GFA) of approximately 229,117 square meters. Based on the initial development concept, Multaqa Al Madinah 2 will comprise approximately 1,527 residential units distributed across three residential zones. The development will also include approximately 31,108 square meters of Net Leasable Area (NLA) comprising commercial and office components. The project scope will further include: The residential component is planned for sale, including off-plan sales during the construction period and the sale of any remaining units following completion and handover. The commercial and office components will be developed for leasing and operation until achieving stabilized occupancy and operational levels, after which they are intended to be held until an eventual sale. Under the proposed structure, the parties intend to establish a closed-ended real estate investment fund, subject to the regulations and approvals of the Capital Market Authority (CMA), to own, finance and develop the project. KEC will contribute the project land as an in-kind contribution, while Kaden will make a cash contribution. Under the initial structure, KEC is expected to hold 75% of the fund units, while Kaden will hold the remaining 25%. The total equity requirement for the project is initially estimated at approximately SAR 832.7 million, comprising approximately SAR 624.6 million representing KEC’s 75% interest and approximately SAR 208.2 million representing Kaden’s 25% interest. The project land contributed by KEC has been initially valued at approximately SAR 692.3 million. Upon execution of the definitive agreements and completion of the required procedures, KEC is expected to receive approximately SAR 67.7 million in cash, in addition to fund units with an estimated value of approximately SAR 624.6 million. The project is expected to be financed through a combination of equity, bank financing and proceeds from off-plan sales, subject to the final financing structure and required regulatory approvals. As part of the proposed partnership, Kaden Investment Company will undertake the role of Development Manager for Multaqa Al Madinah 2. Kaden’s responsibilities will include managing the project’s development activities, leasing, property management and residential unit sales, in accordance with the definitive development and management agreements to be signed between the relevant parties. The MOU also provides for the appointment of Capital Hill as fund manager of the proposed closed-ended real estate investment fund, subject to applicable CMA regulations and regulatory approvals. Multaqa Al Madinah 2 is planned as an extension of the first phase of the Multaqa Al Madinah project, which includes a mall, Hilton hotel tower and Hilton-branded residences tower. The new development is expected to expand the destination’s residential, commercial, office and entertainment offerings while creating a more integrated mixed-use urban destination in Madinah. The partnership forms part of KEC’s strategy to maximize the value of its land portfolio through partnerships with specialized investors and developers and through alternative investment and financing structures. The company expects the collaboration with Kaden to support the accelerated development of its projects, diversify funding sources and expand the range of real estate products and uses within Knowledge Economic City. The MOU includes an exclusive negotiation period of 90 days, during which the parties will undertake negotiations, studies and due diligence and work toward finalizing the definitive agreements for the project.