The idea of endowment is fundamentally rooted in a noble feeling from the donor towards society, leading to a sense of social responsibility. Additionally, it is associated with a religious aspect that involves seeking reward from God Almighty. Therefore, endowment is a good charitable act that is appreciated by the Creator and creation alike. Beyond the charitable aspect of endowment, it has an important economic dimension that goes beyond merely doing good for those who directly benefit from it, extending to society at large through the job opportunities and financial mobilization it creates, thus invigorating the economy and stimulating growth.
The Kingdom of Saudi Arabia is characterized by an economic and cultural environment that encourages endowment, as it is historically known with existing evidence since the early days of Islam. Currently, the volume of endowments—especially real estate ones—increased both in number and geographical diversity, as well as the value of endowment funds estimated between 350 and 500 billion Saudi Riyals, distributed between public endowment funds and those in the private sector.
As one of the important institutional developments witnessed by the Kingdom for some time, the real estate endowment authority was established in 1437 with the aim of organizing endowment work and maximizing its benefits for the economy and society, encouraging individuals and institutions to engage in this work. Despite the youth of this authority, it has begun establishing an institutional framework with strategic goals and well-developed action plans to organize this important economic and charitable sector in the Kingdom.
Before the existence of the endowment authority, an institutional framework was established for many private endowments from businessmen and companies so that they could operate in an organized manner with administrations that are as professional as possible. I had the opportunity to review an important experience represented by the endowments of Sheikh Mohammed bin Abdulaziz Al-Rajhi, where good management and outstanding projects are notable in terms of size, diversity, and overall benefit. I assert that many private endowments are managed somewhat similarly.
Recommendations for Developing Real Estate Endowments and Enhancing Their Economic and Charitable Role
Despite the significant role of the endowment authority and charitable endowments, there is still a long way to go to activate this vast amount of endowments and direct it more effectively to serve the economy and society. I would like to emphasize or add to some points. There is great importance in developing the administrative and financial oversight of endowment activities, particularly for real estate endowments and generally for other types of endowments.
Benefiting from the experiences of advanced countries in endowment management will be an excellent opportunity to start from where others have ended. Additionally, developing quantitative indicators for evaluation and comparison will represent an important tool for administrative and financial oversight over economic endowment activities. This is likely to be one of the main tasks entrusted to the real estate authority, and the Ministry of Housing, commercial chambers, and real estate developers may play a role in preparing the necessary regulations and qualifying human resources for that.
The role of charitable endowments can be expanded to include non-traditional charitable fields—important as current aspects are—such as real estate endowments to support scientific research by funding specialized research centers in all fields that are of interest to society, as well as sponsoring outstanding students. Additionally, endowment funds can be directed to support entrepreneurial projects by proactive youth, whether traditional investments or investments in advanced technology and information systems.
Among the important matters that can contribute to developing the economic role of real estate endowments is the qualification of specialized human resources from students of administration and economics faculties and the creation of specialized professional certificates such as "Specialized Custodian Certificate" or "Endowment Real Estate Analyst Certificate" or something similar. The endowment authority can collaborate with the Real Estate Institute and the Assessment Authority in this regard.
Thus, viewing real estate endowments as an economic resource will undoubtedly contribute to activating their charitable role and alleviating the public finances of the state noticeably in the short and long term.
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