Red Sea Global secures $1.7bn funding for Amaala project

Red Sea Global (RSG), the developer behind regenerative tourism destinations Amaala and The Red Sea, has secured a SAR 6.5 billion ($1.73 billion) credit facility made available for the development of Amaala - an ultra-luxury wellness destination with regeneration at its core.

Amaala, situated at Triple Bay, is set to open this year, with more than 1,400 hotel rooms across eight different resorts. 

It is positioned as an ultra-luxury wellness destination with regeneration at its core. Two of Amaala’s hallmark features include Corallium Marine Life Institute, an educational and scientific research center, and the Amaala Yacht Club, destined to become an international hub for luxury yachting.

On the funding, RSG said it is being led by Riyad Bank as the sole underwriter along with The Saudi Investment Bank (SAIB) and Bank AlBilad as mandated lead arrangers. 

The loan agreement offers a mix of conventional and Islamic financing and adheres to RSG’s Green Loan Framework, which was first established when it secured private funding from a consortium of four banks for The Red Sea destination in 2021, it stated.

This is the third time RSG and Riyad Bank have partnered together. It follows the first green loan facility in 2021, as well as a separate SAR2 billion debt financing for a joint venture with Kingdom Holding Company for the development of the Four Seasons Resort on Shura Island, which is set to open later this year. 

On the key development, RSG Group Chief Executive Officer John Pagano said: "Four years ago, we made history by securing the first-ever Riyal denominated green finance credit facility. Since then, we have built and opened nine hotels at The Red Sea destination as well as supporting infrastructure."

"Last month we announced the upcoming opening of Shura Island, which will feature 11 hotels, residences, high-end food and beverage and retail experiences. We have demonstrated that we are a developer who delivers and we’re proud that our financing partners recognize this and have faith to once again back our destinations, this time supporting Amaala, which opens in the coming weeks," he stated.

Nadir Al Koraya, President and Chief Executive Officer of Riyad Bank, said: "Red Sea Global continues to demonstrate exceptional capability in delivering on bold and transformative developments that align with the Kingdom’s Vision 2030 goals." 

"We are proud to once again support them, this time in realising Amaala, an ambitious, sustainability-driven destination that will redefine wellness and luxury tourism," stated Al Koraya.

Gregory Djerejian, Group Head of Investments and Chief Legal Officer at RSG, said: "We are grateful to our partners for their continued trust and support. Their backing not only reflects confidence in our vision, but also reinforces our shared commitment to responsible, future-focused development."

"Together, we are helping to deliver destinations that set new standards for sustainability, wellness, and economic impact," he added.

The Green Financing accreditation is governed by a Green Financing Framework aligned with the Green Bond Principles and Green Loan Principles set out by the International Capital Markets Association (ICMA) and the Loan Market Association’s (LMA) respectively. 

Advising on the deal was the international law firm Akin, with its Riyadh office acting as borrower’s counsel on the transaction, while Linklaters’ Riyadh office acted as lenders’ counsel. 

Both firms played an integral role in ensuring the smooth execution of the transaction, providing commercially focused and pragmatic legal advice that supported RSG in securing this landmark green financing.-TradeArabia News Service