City Fanar takes shape

Land reclamation is complete, a project manager is appointed and fund raising is underway for the $200 million mixed use development in Saudi Arabia.

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By  David Ingham Published  June 2, 2004

|~|fanar.jpg|~|Land reclamation is complete and building can now begin.|~|Development of City Fanar, a landmark project in the Saudi Arabian real estate market, is gathering pace. Recent months have seen the early completion of land reclamation work, the appointment of a project manager for phase one and a subscription aimed at raising development funds. Reclamation work for the US $200 million project on Saudi Arabia’s eastern coast has been completed two months ahead of schedule. The work, which involved 2.5 kilometres of coastline and was undertaken by Dutch company Ballast Ham, started in May 2002 and had been due to finish in June. “The efficiency that was shown by Ballast Ham represents the commitment of everyone involved in this project,” said Sheikh Khalid H A Al-Ghatani, president and CEO of Rikaz, the developer of the project. “By setting excellent standards, City Fanar will be elevated to the status of a social pillar in the Kingdom, which is owned by the people whose lives it touches.” The Fanar project, also known as ‘Future City’, will cover 3.4 million square metres and contain residential, commercial and retail space. The development will be built around a 300,000 square metre manmade lagoon located on the eastern coast of Saudi Arabia between Dammam and Al Khobar. In the last month, Rikaz has appointed PolyStar Incorporated to manage phase one of the project, which will include responsibility for project management, design and oversight of the construction process. “PolyStar’s reputation for successfully managing large scale projects precedes them and we look forward to a long and successful partnership together,” says Sheikh Khalid. The company has a reported 25 years of experience in the project management and construction fields. “PolyStar is committed to developing strategies for managing risks and selecting the appropriate method of financing to ensure we maximise return on investment for City Fanar,” says Imad Abulaban, CEO and president, PolyStar Incorporated. “We will bring with us our experience in the management of large and complex projects, including the ability to control budgets, scheduling and facilitation design and construction, all in a successful, cost efficient manner which is beneficial for all parties involved in this landmark project.” Meanwhile, Rikaz has launched a subscription aimed at raising $153.4 million for phase two of development. 32,983 shares will be offered to investors at a cost of US $4,642 each, in accordance within an Islamic investment principal called Musahamat. Rikaz expects that investors will see a return of 50% over two years. “City Fanar presents investors with a unique opportunity to take part in a project that will bring a solid return on investment, whilst addressing the essential links between traditional values and contemporary needs at the human scale,” says Sheikh Khalid. Rikaz certainly has high hopes for the project, which it has predicted will become the commercial hub of the Eastern Province. Sheikh Khalid has made several statement distancing himself from what he sees as “frenzy driven” real estate projects. “City Fanar presents investors with a reliable opportunity to take part in a project that will influence the future of the region and bring returns on investment,” he says. An important part of the City Fanar master plan is the Eastern Province’s first and longest pedestrian walkway. This will in turn connect the piazza, a 20 square metre ‘architectural marvel’ in the heart of the commercial area, to the city’s 115,000 square metre main shopping mall, which will inevitably be amongst the largest in the Eastern province. Rikaz has now developed over a dozen projects based on the Musahamat principle, with investment totalling over SR3.5 billion.||**||

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