RIYADH May 6 The Public Pension Agency (PPA),
Saudi Arabia's second-largest pension fund, plans to boost its
investments in real estate and has no immediate plans to exit
any of its holdings in Saudi companies, the PPA's governor said
The agency manages retirement schemes for Saudi nationals.
It is one of the major investors in the local equity market,
with 32 percent of its investments in listed equities and about
12 percent in real estate. It is also a major fixed income
The PPA's governor Mohammad Al Kharashi said the fund paid
out an average of 4 billion riyals ($1.1 billion) a month to
about 1.1 million retirees and their dependants.
"We are open for more investments in real estate. We are
open for any good investment opportunity," Kharashi told
reporters on the sidelines of a conference in Riyadh.
On the stock market, he said: "We believe the market is a
strong one and there is good support for some of the companies
whether in the petrochemical sector, cement, banking.
"We are a long-term strategic investor and we look at these
investments as attractive for us."
While some of the PPA's investments are made for dividends
and others are for capital appreciation, "we are not under
pressure to divest any of our stakes," Kharashi said.
On Monday the kingdom's Shoura Council, a body that advises
the government on policy, suggested raising the retirement age
for government employees to 62 from 60, a step which could
reduce financial pressure on the PPA.
However, it is not clear if the suggestion will be adopted,
and Kharashi said he did not know when the change might be
The PPA has not recently disclosed figures for its size but
in its annual report published in May 2013, it said its local
stock market holdings in 2012 reached 41.8 billion riyals.
The agency is the major backer of the King Abdullah
Financial District, a huge real estate project, in Riyadh;
Kharashi said total investment in the project had reached 31
billion riyals and that the first phase should be completed by
the end of this year, after which leasing could begin.
"We expect payback (through rents) may be within 12 years,"
($1 = 3.7505 Saudi Riyals)
(Reporting by Mirna Sleiman, Marwa Rashad and Angus McDowall;
Editing by Andrew Torchia)