RIYADH: US firm PGIM Real Estate is monitoring the progress of the Saudi market, with an eye on future investment, according to the firm’s co-CEO.
Speaking to Arab News on the sidelines of the Future Investment Initiative taking place in Riyadh, Raimondo Amabile – also the global chief investment officer of the company – explained that in order to also pump money into the region, they will need to find the right partner.
The firm, which has $1.33 trillion in assets under management and administration, provides global access to private alternative investments for institutions and individuals.
Reflecting on Saudi Arabia’s investment potential, Amabile said: “We’re familiar with this place. We’re familiar with major institutions here. We kind of like the direction of travel when it comes to where the country is going. So, we are seriously considering to be much closer to the place to really understand the implementation of these visions of the country.”
He added: “And as I said, I’m pretty sure that the opportunities that will emerge, these opportunities that will be, I guess will be in a place where you can definitely think of attracting. You’re investing international capital into the market because, again, these are the same investment thematic which are driving growth in other places.”
The co-CEO went on to highlight that the question that remains is how the firm is planning to invest in the country.
“My experience with emerging markets like this, well, underwriting the partner and finding the right partner, whether it’s a government entity or a private partner, it’s actually the most important thing because we need to be sure that we have enough of an inside through the partnership which will allow us to get comfortable with our investment proposition and, of course to give to our clients the comfort that their money is invested on a very good risk adjust proposition,” Amabile said.
In terms of where the “hot money” is going into in 2025, he said that it is most likely a data center.
“We have been investing in data centers since more than 10 years. We know this space very well. It’s definitely one of the thematic investments which we like,” the co-CEO said.
Amabile also shed light on how this is the right time to invest in the real estate market.
“First of all, when it comes to real estate, this is the right time to consider investing in the real estate. We have gone through two years of tough market. The market has reset, value has gone down. Now, the cost of capital is coming in after of course, an increase of cost of capital. The fundamentals are still strong,” he said.
“So, there is actually enough ingredients right to really underwrite the recovery of the market. We believe that we are at the bottom of the market right. So definitely, it’s the right time to consider going in, and whether you’re going to go in a credit strategy, financing strategy, or a private equity strategy, taking an equity position, they both have very good risk adjust propositions which you can capture,” the global chief investment officer added.
He also highlighted that one of the largest asset classes that the company has in its portfolio is global living, which includes income-generating residential properties tailored for rental and various generational needs.
Under the theme “Infinite Horizons: Investing Today, Shaping Tomorrow,” this year’s edition of FII saw discussions on how investments can drive a thriving and sustainable future, pushing the boundaries of what is possible for humanity.
This aligns with the forum’s mission to create a purposeful present and a promising future, as well as its vision to bring together the brightest minds and most promising solutions to serve humanity.
