Riyadh – Mubasher: Almajdiah Real Estate Company has signed a framework agreement for the development of the Eastern Hindawiyah area in Makkah, according to a bourse filing.
The agreement was penned on 24 June 2026 to establish the legal and regulatory structure for a major urban regeneration project conducted by a development consortium.
The participating entities include Almajdiah, First Avenue Real Estate Development Company, and Rikaz Real Estate, with Jadwa Investment serving as the fund manager.
The framework agreement follows the initial project award notification issued by the Royal Commission for Makkah City and Holy Sites on 9 June 2026.
Meanwhile, the primary objective of this latest agreement is to define the rights, obligations, and responsibilities of all participating parties while outlining the execution mechanism for the project in accordance with relevant Saudi Arabian regulations and upcoming executive agreements.
Under the terms of the agreement, the development consortium will receive a development fee equivalent to 15% of the project’s actual costs, which are expected to be finalized in a subsequent development agreement once comprehensive studies and approved design plans are completed.
Furthermore, the contract includes a performance incentive for the consortium equal to 14% of returns exceeding a target internal rate of return (IRR) of 8%. The consortium is also entitled to a brokerage fee of 2.5% on project sales.
A central component of the framework is the establishment of a private closed-ended real estate investment fund, managed by Jadwa Investment, to be utilized for acquiring the project land and finance its development.
The consortium has been appointed as the exclusive developer, tasked with executing infrastructure works, land preparation, and site readiness to facilitate further investment and development.
Almajdiah confirmed that its participation share within the development consortium stands at 35%.
The company further noted that the Eastern Hindawiyah project is considered a qualitative developmental initiative within Makkah. It aligns with broader efforts to modernize urban neighborhoods, improve the quality of life for residents, and promote sustainable urban growth within the Holy City.
Regarding the financial impact, Almajdiah expects the project to contribute positively to its financial performance throughout the various stages of development. However, the company clarified that the exact magnitude and timing of this impact cannot be accurately determined at this stage.
A more precise financial outlook will be available following the formal establishment of the investment fund, the signing of the final development agreement, and the approval of the total project costs.
The disclosure also highlighted a related party transaction. Abdulsalam bin Abdulrahman Al Majid, the Managing Director of Almajdiah Real Estate, also serves as a board member for First Avenue, one of the partners in the consortium.
The signing of this framework agreement marks a transition from the award phase to the operational structuring of the Eastern Hindawiyah project.
By securing exclusive development rights and establishing a dedicated investment vehicle through Jadwa Investment, Almajdiah and its partners have solidified the administrative foundation required to begin large-scale infrastructure and urban renewal works in Makkah.
