SAUDI ARABIA —Sumou Real Estate Company has signed a development management agreement with Saudi Downtown Company, a wholly owned subsidiary of Saudi Arabia’s Public Investment Fund (PIF), for a residential development in Downtown Al Khobar. Signed on 1 November 2026, the agreement appoints Sumou to oversee the development, execution, marketing and sale of mid-rise residential buildings on a 28,292-square-metre site located south of the Boulevard within the wider Downtown Al Khobar development. Saudi Downtown Company is the land-contributing partner, while Sumou will undertake project management and contribute part of the investment.
The agreement does not disclose a fixed overall contract value. Instead, Sumou’s compensation is linked to project costs, sales and profitability. The company will receive development management fees equivalent to 6.50% of total development costs and marketing and sales fees of 2.00% of total sales. In addition, it is entitled to 32.00% of the project’s net profits in consideration of its investment. The remaining funding requirement is expected to be met through proceeds from off-plan property sales.
The project will introduce residential units within a major urban development area in Al Khobar, supporting the expansion of the city’s housing supply. The partnership combines land ownership and development capacity from Saudi Downtown Company with Sumou’s role in project execution and commercialisation. This structure distributes project contributions between the parties while linking part of the developer’s returns to sales performance and the eventual profitability of the development.
The implementation period is 48 Gregorian months from the agreement’s effective date. Sumou expects the arrangement to contribute positively to its financial performance once the agreement takes effect and project activities begin. The timing and scale of the financial contribution will depend on development progress, construction expenditure and residential sales.
Sumou Real Estate operates in Saudi Arabia’s property development sector, undertaking real estate development and related project activities. Saudi Downtown Company is a PIF-owned entity established to develop urban centres and mixed-use destinations across the Kingdom. The agreement reflects a partnership model in which a public-sector-backed landowner works with a private real estate developer to deliver residential assets, with implications for property developers, construction companies, marketing agencies and prospective homebuyers in the Eastern Province.
