Arcapita, a premier alternative asset manager, has adopted a strategic transformation plan for the next five years, CEO Atif Abdulmalik told Asharq Al-Awsat.
The strategy aims to increase the volume of deals in private equity and real-estate sectors by enhancing product offerings so that they match the company’s success in implementing 100 strategic deals worth $31 billion over the past 25 years.
“Over the past twenty-five years, we have achieved many successful deals and investments. We have executed 100 strategic deals worth $31 billion, and we are looking forward to more qualitative investments in promising markets during the next stage,” said Abdulmalik, adding that opening company offices in Riyadh last April represents an essential stage for growth of business in the region.
Abdulmalik explained that Arcapita’s activity is distributed over direct investment in companies and real-estate, with a focus on industrial real-estate in the Gulf countries, especially Saudi Arabia and the UAE, in addition to the US.
The CEO noted that the company, through its transformation plan, seeks to diversify its asset base and reduce exposure to risk by acquiring assets in real estate sectors that are based on strong long-term foundations.
“Arcapita's investment strategy focuses on the private equity and real estate sectors, and through this strategy we are working to acquire non-asset-intensive, technology-backed companies where we can leverage our expertise to drive growth,” noted Abdulmalik.
“The company also supports socially responsible investments through a range of products and services including transactions on a deal-by-deal basis, mutual funds and managed accounts,” he added.
“Arcapita consolidates its interests with investors by investing a 5-10% stake in each investment opportunity,” revealed Abdulmalik.
Arcapita's future directions include the expansion of logistical activities through the establishment of a logistics fund in Saudi Arabia with investments amounting to $1 billion.
Moreover, the company invested other funds in Saudi Arabia and the UAE, to bring the total investments in this sector to around $1.6 billion by the end of 2022.
These investments coincide with foreign investors and investment institutions looking to seize opportunities found in the Saudi market and presented by changing global investment patterns led by a new generation of investors.
“The private equity sector is one of the main sectors that we focus on greatly, and it can be identified in three main sectors: corporate services, logistics services and individual services, and each of these sectors has advantages, great capabilities and rewarding returns,” said Abdulmalik.
“The corporate services sector is witnessing strong growth potential, and Arcapita continues its acquisitions of companies in the facilities management services sector and real estate appraisal management,” he added.
“As for the logistics sector, Arcapita aims to study more opportunities in this sector, which benefits greatly from the growth of e-commerce and focuses on home delivery services to consumers.”
When asked about Arcapita’s investments in the real-estate sector, Abdulmalik said that the company’s real-estate strategy “focuses on three sub-sectors: the industrial real-estate sector, the residential complex sector, and the student housing sector.”
“We will continue to focus on industrial and logistics real estate in the Gulf states, particularly Saudi Arabia and the UAE, as well as the US,” he added.
“Arcapita is looking to expand its business in a number of key markets in Saudi Arabia, the UAE, the UK and Singapore, which contributes to harnessing our expertise in key growth markets and our understanding of sectors and niche offerings in order to provide greater value to the communities in which we operate,” noted the CEO.
As for the Arcapita real estate portfolio, Abdulmalik noted that the company is targeting industrial and residential properties, logistics facilities, condominiums, and student housing in high-growth markets.
Since its establishment in 1997, Arcapita has been committed to providing investment products and services that comply with the principles of Islamic Shariah.
The company’s expansion in global markets came due to the increasing demand for products that comply with Shariah law.
“A large part of Arcapita's future directions includes the expansion of logistical activities. This will be done through the establishment of a logistics fund in Saudi Arabia with investments amounting to $600 million and another fund in the UAE with the same value, so that the total investments in this sector amount to $1.2 billion,” said Abdulmalik.
