SmartCrowd Holdings, a startup specialising in fractional real estate investments, has been granted a FinTech experimental permit by the Saudi Capital Markets Authority (CMA). SmartCrowd is currently working on completing business requirements for the upcoming launch of its Real Estate Funds Distribution Platform, making alternative assets accessible to the general public within Saudi Arabia soon.
Saudi Arabia's residential real estate market is an immense untapped sector offering an excellent opportunity for regional and global investors, with forecasted market growth (CAGR) of more than 9.74% between 2022 - 2027.
Valued at SAR 156bn in 2021 (Source: Knight Frank), the real estate market is expected to grow significantly, in line with the country's Vision 2030, the rapid pace of new developments, and the Kingdom's ongoing efforts to diversify its economy away from reliance on oil and gas revenues.
Abdullah A. Al Othaim, CEO of Mad'a Investment, a Saudi-based firm and lead investor in SmartCrowd's latest bridge round, said: "SmartCrowd's expansion into Saudi Arabia provides an ideal opportunity for locals to diversify their portfolio and global investors to take advantage of the thriving Saudi real estate market.
"The current global markets are facing major challenges. SmartCrowd provides an opportunity to diversify against uncertainty since the real estate market is the most favorable due to its simplicity and lower volatility."
Yousef Albabtain, a Principal at Shorooq Partners, the UAE-based venture capital firm and early-stage investors in SmartCrowd, said: "We are proud to be part of SmartCrowd's journey as the region's first and most prominent real estate crowdfunding platform. The world-class experience SmartCrowd built has empowered thousands of investors to diversify their portfolios and generate compelling returns.
"We believe the recent expansion into the Kingdom of Saudi Arabia represents a key milestone by the team to unlock the enormous potential in the largest MENA market. We are confident that SmartCrowd will play a vital role with all Saudi regulators and stakeholders to deliver greater financial prosperity to more individuals."
Currently headquartered in Abu Dhabi as part of Hub71's tech ecosystem, SmartCrowd's expansion into Saudi Arabia aligns with its mission of making real estate investing more accessible to the masses by enabling individuals to invest in income-generating properties collectively.
Since its inception, the platform has funded over 75 properties worth over AED65M, distributed over AED 3.2M in rental income, and recently exited an investment property with a total return of 39.25%, demonstrating a complete investment cycle. SmartCrowd is also one of the few wealth-tech platforms in the region that has generated tangible returns to its investors, making the product appealing to its users, as evidenced by its 65% re-investment rate.
SmartCrowd CEO and Co-Founder Siddiq Farid said: "With the newly granted Saudi permit, SmartCrowd has solidified its position as a major regional player. In line with increasing demand and investor appetite for diversified real estate opportunities, SmartCrowd will continue to introduce innovative products and enter new regional markets."
SmartCrowd's platform users are 80 per cent UAE-based. The remaining 20 per cent come from all over the world, even as far as New Zealand and Australia, and are using SmartCrowd to build a diversified real estate portfolio.
Having witnessed double-digit growth in both AUM and investors over the last two quarters, SmartCrowd will be raising fresh capital to finance its regional expansion.