Saudi Arabia’s flagship tourism project developer, The Red Sea Development Company (TRSDC) has stated that it has secured a $3.77 billion (14.12 billion riyal) green loan from four Saudi banks for the construction of 16 new hotels.
The financing is the first riyal-denominated credit facility to be certified as green financing. Banque Saudi Fransi, Riyad Bank, Saudi British Bank, and Saudi National Bank acted as mandated lead arrangers, while HSBC served as green loan coordinator on the transaction.
According to the reports, the hotels form part of a new high-end tourism development across islands, deserts, and mountains near the country’s west coast, powered by renewable energy.
TRSDC was awarded Green Financing accreditation because of its approach to social and environmental sustainability, as well as the Red Sea Project’s international recognition as a green project, as per the statement.
“By applying a unique approach to design, utilizing more sustainable methods of construction, and using groundbreaking technology, we are not only reducing our impact on the environment but helping to deliver on our commitment to achieve a 30 percent net conservation benefit by 2040. It is this pioneering approach that has helped us secure the first-ever Riyal-denominated Green Finance credit facility. We aim to lead the international luxury tourism industry’s transformation into a more sustainable model, including environmental and social sustainability. This Green Finance classification is the latest proof that we are setting new standards in ecotourism and showing the industry that things can be done differently both here in the kingdom, and globally.”
The Red Sea Project expects to welcome its first visitors by the end of 2022 by the opening of the international airport and first hotels. The first phase, which will include 16 hotels in total, will be completed in 2023, according to the company statement.
Upon completion in 2030, the Red Sea Project will comprise 50 resorts, offering up to 8,000 hotel rooms and more than 1,000 residential properties across 22 islands and six inland sites. The destination will also include luxury marinas, golf courses, entertainment, and leisure facilities.
The project, which is fully owned by the Public Investment Fund, is critical to Saudi Arabia’s Vision 2030, an economic transformation plan aimed at diversifying the country’s economy away from oil.