Saudi Arabia’s Neom is planning its debut riyal bond sale for later this year, reports Bloomberg, citing people familiar with the matter. The giga-project is looking for more sources of funding for the $1.5 trillion worth of construction projects it plans for the futuristic city.
According to Bloomberg’s sources, Neom has picked banks to provide advice on the sale of Islamic bonds, or sukuk, including HSBC Holdings Plc and the securities divisions of Al Rajhi Bank and Saudi National Bank. The debt, which could raise up to 5 billion riyals ($1.3 billion), would be expressed in local currency.
The majority of the development’s funding to date has come from equity injections provided by Saudi Arabia’s sovereign wealth fund, led by Crown Prince Mohammed bin Salman. Neom’s creators have also been looking for additional funding to complete the ambitious project.
A group of Saudi banks recently granted Neom a 10 billion riyal loan and the developers have also secured a loan of three billion riyals to fund Sindalah, a luxury Red Sea holiday island.
The Line scaled back
Plans for Neom’s flagship project, The Line, a zero-carbon city with “vertically layered” buildings, have recently been scaled back. It was originally meant to stretch 105 miles (170km) but is now expected to reach just a mile and a half (2.4km) by 2030.
Giles Pendleton, The Line’s chief operating officer, recently shared a selection of new images on LinkedIn to showcase the latest updates at the giga-project. Alongside the images, he wrote: “How to answer the naysayers about the incredible work being done in Neom? Show a cross section of the world’s largest building site from the mountains to the sea.”
Last month, Neom also unveiled Treyam, a lagoon resort offering technology-enhanced health and wellness experiences, which it calls an “elevated haven in which to unwind, re-energize and enjoy majestic natural surroundings”.
