THIS MORNING: Humain eyes SAR 20 bn Goldman-advised package for riyadh data centers

Good morning, all. Real estate leads today’s issue, as we look at the Kingdom’s residential market and how it has been impacted by the regional war.

Plus: In a conversation with Sharakah Capital Partner Latifa Banasr, we dive into what the medium-term has in store for regional VCs.

Happening today

#1- A GCC-UK trade agreement could be finalized today as representatives from both sides meet in London, Bloomberg reports, citing comments made by GCC Secretary-General Jasem Albudaiwi that were picked up by Saudi media. From the UK side, officials said talks were ongoing but steered clear of specifying whether the agreement would come today.

ICYMI- Earlier this week, sources familiar with the matter said an agreement would be wrapped up “within days,” after Albudaiwi said last week that talks had made “significant progress.” Financial services, health, and industrial growth were among the sectors cited for cooperation efforts.

A long time coming: Talks have been ongoing for around four years now, with reports of an imminent agreement going as far back as 2024. More recently last October, UK Finance Minister Rachel Reeves had said one would be reached “very soon.”

#2- Dar Al Balad will start trading on Tadawul’s main index today, after the IT service outfit saw strong demand for both its institutional and retail tranches. We will be watching closely how the first GCC IPO after the Iran War will perform on its first day.

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Watch this space

TECH — Humain taps Goldman Sachs for data-center financing push: PIF-owned AI champion Humain reportedly hired Goldman Sachs to advise on a financing package of at least SAR 20 bn to build out data centers in the Riyadh area, Reuters reports, citing sources it says are in the know.

The money will go toward data center infrastructure and GPU chips for 2 GW of capacity — about a third of Humain’s 2034 target.

Why bring in Goldman now? The numbers are getting too big. The IEA recently put globaldata center investment needs at USD 3.9 tn between 2026 and 2030, calling it “too large to be funded solely from the balance sheets of AI companies.”

Humain has been moving quickly, striking agreements with Elon Musk’s xAI (where it holds aminority stake), Blackstone-backed AirTrunk, and a separate AI zone partnership with Amazon Web Services (AWS).

The Iran war wrinkle: The financing push comes despite fresh regional security concerns after Iranian drones struck AWS data centers in the UAE and Bahrain. AWS is still pressing ahead with its multi-USD bn investment alongside Humain — a signal that hyperscalers are wagering that the Kingdom's interior geography and cheap energy outweigh the headline risk for now.

The bigger picture: Saudi is racing the UAE and Qatar to position itself as the Gulf’s compute hub, pitching cheap power to the likes of Google, Microsoft, and Meta. The PIF has also been on a recalibration push, scaling back some gigaprojects to liberate capital for high-return sectors, especially AI and tech.

DEBT WATCH — Alinma Bank is tapping the USD debt market with a USD-denominated sustainable AT1 issuance, according to a Tadawul disclosure.

This will be Alinma’s second issuance this month. The shariah-compliant lender kicked off an issuance of SAR-denominated AT1 sukuk earlier this month under an existing SAR 5 bn program. The issuance ended on Sunday.

Why it matters: Regional issuers are leaning into international markets to strengthen their capital base while pricing windows remain open. S&P had expected domestic banks’ net external debt to rise to 6% of total loans by end-2026.

The debt drive comes after a solid opening to the year: Alinma’s 1Q net income rose 11.3% y-o-y to SAR 1.7 bn, buoyed by expanding financing and investment portfolios.

ADVISORS- The bank tapped Abu Dhabi Islamic Bank, Alinma Capital, Arqaam Capital, ASB Capital, Citi, DBS Bank, Emirates NBD Capital, First Abu Dhabi Bank, Goldman Sachs, JPMorgan, Mashreq, Standard Chartered, and Warba Bank as joint lead managers.

REAL ESTATE — Saudi Arabia plans to issue up to SAR 150 bn (USD 40 bn) in international real estate sukuk by 2030, Housing Minister Majed Al Hogail told the Arabic press (watch, runtime: 1:20). The government aims to debut the program this year with an initial SAR 20 bn tranche, provided global geopolitical tensions settle and borrowing costs decline.

Why it matters: The pivot to international debt markets is a move from the Kingdom to shoulder the domestic banking sector as it needs more funds to finance the national housing boom.

The annual trend: Saudi Real Estate Refinance tapped international markets last year with a USD 2 bn issuance that was 6x oversubscribed.

ENERGY — The proposed US-Saudi nuclear cooperation agreement is reportedly in “final review,” but does not include key guardrails called for by Democratic lawmakers, according to a State Department letter seen by Reuters. The pact will establish a “legal foundation” for a “USD multi-bn civil nuclear partnership,” according to the letter, which did not divulge further details.

What’s next? The agreement will take effect within 90 days of being approved by President Donald Trump, unless the US Senate and the House of Representative pass resolutions to impede it.

What we know so far: The proposed pact could potentially permit the Kingdom to acquire uranium enrichment technology or capabilities, as well as enable cooperation in fuel fabrication and reprocessing.

Data point

USD 149.6 bn — that’s where Saudi Arabia’s US Treasuries holdings stood in March, down USD 10.8 bn m-o-m, according to data from the US Treasury Department. The dip serves as a sharp reversal from the record monthly increase seen in February. The Kingdom nonetheless maintained its position as the 17th largest foreign holder of US debt.

The decrease was driven by a drop in short-term Treasuries, which declined 22% m-o-m to USD 42.6 bn, reducing our share of total holdings to 28.5% from 34% in February. Long-term bonds edged up a slight 1.1% to USD 106.9 bn, accounting for 71.5% of the portfolio.

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The big story abroad

With Kevin Warsh poised to take the helm of the Federal Reserve this Friday, business headlines are focusing on rising treasury yields that could complicate his expected dovish agenda. Investors may demand higher returns for long-term debt, especially amid rising energy prices, a resilient economy, and the highest yield on treasuries in almost 20 years.

Meanwhile, in the tech world: Google is further integrating AI in its search function while introducing what it calls Gemini Spark, an AI “agent” that is designed to function independently and act on a user’s behalf. The tech giant is also rolling out smart glasses that will include a camera and speaker in a bid to challenge moves made by its rival Meta.

And speaking of AI: Standard Chartered is looking to slash some 8k jobs in favor of relying more heavily on AI, with cuts affecting its human resources and risk and compliance functions. The company’s CEO Bill Winters has characterized the move as a shift away from “lower-value human capital.”

ALSO: Elon Musk’s SpaceX has reportedly tapped Goldman Sachs to lead its highly anticipated IPO, with the bank set to assume the most prominent spot among the underwriters involved. Goldman and Morgan Stanley will reportedly be serving as lead bankers.

LIV Golf sliding into bankruptcy? Weeks after losing its backing from the Public Investment Fund, LIV Golf is reportedly exploring a US bankruptcy filing as a worst-case scenario if its search for new capital falls short. The golf league is looking for investors before the season ends in August.

Good news for Arsenal fans: For the first time in 22 years, Arsenal FC took home the Premier League championship after Manchester City tied in yesterday’s showdown with Bournemouth. The Gunners, under the leadership of Mikel Arteta, have secured a total of 82 points.