From the desk of the CEO 03rd September 2013

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As we prepare for the final quarter of 2013 and look beyond, this is a good time of the year to gather our thoughts and plan for the future. With the close of our fourth year in Saudi Arabia, we at CGI would like to take this opportunity to provide a glimpse into our current accomplishments and vision for the way forward, and to recognize our public and private sector partners here in the Kingdom, across the region, and around the globe for their commitment and active collaboration.

In the rapidly changing regional context, Saudi Arabia has devoted billions of riyals to the development of infrastructure and housing for its citizens, among other spending programs. Accordingly, CGI's commitment has been to build companies and platforms that contribute to the diversification of the Kingdom's growing economy and the overall livelihood of Saudi citizens. This effort was made in line with the vision of our partner, the Islamic Corporation for the Development of the Private Sector (ICD), and through the strong structuring and executive experience of CGI's team.

Securing strategic business commitments from institutions such as the Islamic Development Bank, the Public Investment Fund, the Arab Investment Company, the Deghaither Group, Manafea Holdings, International Financial Advisors (IFA) of Kuwait, the King Abdullah Bin AbdulAziz Endowment, Bank Nizwa, the first Islamic bank in Oman, and several other prominent institutions and family groups, has proven to us that confidence in the Saudi real estate sector and economy can be garnered from local and international investors if the right business models and structures are developed. As a result, CGI is now poised to launch three independent financing and investment platforms for the Kingdom of Saudi Arabia with a combined capitalization of over SAR 2 billion.

During the last quarter of 2013 and the first quarter of 2014 our Financial Platforms team will oversee the launch of two major companies in Saudi's real estate finance/investment sector. The first company, Ijmal, will provide targeted funding to promote housing development across the Kingdom. Our team has created an innovative structure that provides investment capital to medium sized developers who do not meet the stringent requirements for banks' project financing programs. The market's response to this structure has been overwhelmingly positive and we look forward to a strong launch later this year.

In tandem with Ijmal, CGI is also launching Bidaya as a national mortgage finance company to provide much needed funding to support the drive to home ownership across the country. A select group of shareholders including the Public Investment Fund, and some of the Kingdom's largest conglomerates and business families, will invest in the SAR 1 billion company which is projected to fund the acquisition of more than 10,000 homes in its first five years of operations. Preparations are now being made to license and launch the company in early 2014.   Our focus on the real estate sector has been complemented through our role in the launch of the Saudi SME Fund, which will be a SAR 1 billion investment fund to provide growth capital to small and medium enterprises in a broad range of sectors across the Kingdom. CGI designed and structured the Fund to support ICD's vision to expand investment in this critical economic sector. The Fund has been developed in collaboration with the experienced professionals at Malaz Capital and includes such prominent investors as ICD, The Islamic Development Bank and the Saudi Credit and Savings Bank.

As a further example of our strategy of creating unique localized real estate platforms, we launched our Development Management Service (DMS) as an independent practice to manage and deliver large scale real estate projects to the market in 2012. By pairing our core business and finance expertise with a diverse team of technical experts DMS offers a complete, end-to-end, real estate development solution to the market. Since its inception just over one year ago, our Development Management team has been engaged by major institutions in the public and private sector including Al-Balad Al-Ameen (Makkah), Mafaz International (Riyadh), SHARACO (Riyadh), MODON, and King Abdullah Economic City (Thuwal), among others, with an aggregate development value of over SAR 38 billion. DMS' projects have ranged from a major urban regeneration mandate in Makkah to multiple hospitality, resort and residential projects in Riyadh, Madinah, and Jeddah, and an exclusive agreement with Kuwait-based IFA to bring the Yotel hospitality brand to the Kingdom.

Beyond Saudi Arabia, CGI is now working with its international partners to develop home financing programs in markets across the region including Morocco, Oman, and Turkey, among others. Our overriding objective is to establish customized platforms that enhance the availability of real estate financing and affordable homes to multiple markets in the OIC region over the coming 5 years.

We are confident that our dedication to the market, coupled with our relationships and partnerships, will continue to develop companies and platforms that promote market development, provide robust investor returns and support the ultimate goal to enhance the flow of funding to the critical real estate and SME sectors across the region.

As always, we look forward to hearing from you and to collaborating on opportunities going forward.

Naveed Siddiqui
Capitas Group International