Saudi’s Alkhabeer Capital Targets Islamic Endowment Business

Saudi Arabia-based Alkhabeer Capital said on Monday it had launched an advisory service for structuring and managing the assets of the Islamic charitable foundations known as awqaf.

Alkhabeer, an Islamic investment and advisory firm, becomes one of only a few private sector firms globally to focus on awqaf assets.

The foundations are believed to control tens of billions of dollars worth of assets around the world; Muslims use them to contribute a portion of their wealth, in cash or other forms, to charitable projects such as mosques and schools.

In many cases their management has remained ultra-conservative, unsophisticated or inefficient, meaning they earn low returns on their assets. So in the last few years there have been efforts across Muslim-majority countries to modernise the management of awqaf.

Alkhabeer will target educational institutions, family offices and wealthy individuals that want to establish awqaf, offering the services of asset managers, the firm said in a statement.

The firm was founded in 2004 initially focusing on real estate and private equity transactions, but is now actively developing its capital markets business.

Some analysts estimate awqaf in Saudi Arabia alone now control between $100 billion and $250 billion of assets.

In 2013, Dubai’s Noor Investment Group and the Awqaf and Minors Affairs Foundation, a Dubai government body which runs endowments, launched an advisory firm specialising in managing awqaf assets. Regulators in Egypt and Malaysia have also moved to modernise the sector.