"This funding will contribute to the project by accelerating the development operations and pushing ahead to the next phase of sending evacuation notifications, the compensation and transfer of ownership of the properties located in the project area," it said in a bourse statement on Saturday.

The Qasr Khozama project spans an area of 4 million square meters in the old downtown district of Jeddah, which includes historical landmarks and old buildings, many of which will be demolished and replaced with modern buildings.

The port-city of Jeddah, the second-largest in the kingdom, is undergoing many development projects to modernize infrastructure.

Copyright Reuters, 2011