SmartCrowd Obtains CMA License to Expand into Saudi Arabia

SmartCrowd Holdings, a regional pioneer in fractional real estate investments, has obtained an experimental FinTech license from the Saudi Capital Markets Authority (CMA). SmartCrowd is currently working to fulfill the business requirements for the upcoming launch of its Real estate fund distribution platform, soon make alternative assets available to the general public in Saudi Arabia.

The residential real estate market in Saudi Arabia is a huge untapped sector offering an excellent opportunity for regional and global investors, with a projected market growth (CAGR) of over 9.74% between 2022 and 2027.

Valued at SAR 156 billion in 2021 (Source: Knight Frank), the real estate market is expected to grow significantly, in line with the country’s Vision 2030, the rapid pace of new developments and the Kingdom’s continued efforts to diversify its economy away from the addiction. on oil and gas revenues.

Abdullah A. Al Othaim, CEO of Mad’a Investment, a Saudi company and leader investor during SmartCrowd’s latest funding round, said, “SmartCrowd’s expansion into Saudi Arabia provides an ideal opportunity for locals to diversify their portfolios and for global investors to take advantage of the booming Saudi real estate market.

“Today’s global markets are facing major challenges. SmartCrowd offers an opportunity to diversify in the face of uncertainty since the real estate market is the most favorable due to its simplicity and low volatility.”

Yousef Albabtain, Director of Shorooq Partners, the UAE-based venture capital firm and early investors of SmartCrowd, said: “We are proud to be part of SmartCrowd’s journey as the first and largest funding platform. participatory real estate in the region. The top-notch experience built by SmartCrowd has enabled thousands of investors to diversify their portfolios and generate attractive returns.

“We believe that the recent expansion into the Kingdom of Saudi Arabia represents a key step for the team to unlock the huge potential of the largest market in the MENA region. We are confident that SmartCrowd will play a vital role with all regulators and Saudi stakeholders to deliver greater prosperity to more people.”

Currently based in Abu Dhabi as part of Hub71’s technology ecosystem, SmartCrowd’s expansion into Saudi Arabia aligns with its mission to make real estate investing more accessible to the masses by empowering individuals to collectively invest in income generating properties.

Since its inception, the platform has financed more than 75 properties worth more than AED65Mdistributed AED3.2 million in rental income, and recently left an investment property with a total return of 39.25%, demonstrating a full investment cycle. SmartCrowd is also one of the few wealth technology platforms in the region that has generated tangible returns for its investors, making the product attractive to its users, as evidenced by its 65% reinvestment rate.

SmartCrowd CEO and Co-Founder Siddiq Farid said, “With the newly granted Saudi license, SmartCrowd has cemented its position as a major regional player. In line with growing demand and investor appetite for diversified real estate opportunities, SmartCrowd will continue to introduce innovative products. and enter new regional markets.”

80% of SmartCrowd platform users are based in the United Arab Emirates. The other 20% come from all over the world, even New Zealand and Australia, and use SmartCrowd to build a diversified property portfolio.

After recording double-digit growth in AUM and investors over the past two quarters, SmartCrowd will raise new capital to fund its regional expansion.

The SmartCrowd mobile application, now available on iOS App Store and Google Play, makes real estate investments even simpler and more accessible.

BACKGROUND INFORMATION:

The Saudi government’s emphasis on the real estate sector, as part of the process of diversifying the economy, is expected to boost the domestic residential market in the coming years.

The Saudi population is dominated by young, middle-class people who are renters and first-time home buyers. About 45% of the country’s population is under 20 years old.

As such, there is a significant housing shortage in the MENA region – particularly in Saudi Arabia. Demand from expatriate tenants has further intensified the housing shortage, with an estimated 5.5 million expatriate workers in the country (expected to increase with the opening of Saudi Arabia).

As young Saudi nationals and expatriates show a preference for more affordable apartments and properties, the government is taking action, such as incentivizing developers to build affordable housing projects, thereby encouraging banks to introduce more housing options. real estate financing.

Raising the home ownership rate of Saudi nationals to 70% by 2030 is a key ambition of the Saudi Ministry of Housing, which has announced a plan to build around 19,500 residential units for its citizens under the development program of “Sakani” accommodation.

The Kingdom has even introduced a rental price index to increase transparency and regulation in the residential property sector. These initiatives are expected to increase homeownership rates and strengthen the residential real estate market across the country.

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