Saudi Arabia is to transfer ownership of Riyadh’s floundering King Abdullah Financial District (KAFD) to the Public Investment Fund (PIF) from the Public Pension Agency (PPA), according to four sources aware of the matter.

The move is an attempt to rescue the project, started a decade ago with the aim of making the Saudi capital a global financial centre, and is another example of the burgeoning power of the PIF, which the Gulf state wants to make the world’s largest sovereign wealth fund.

A new approach to the project was outlined in the Vision 2030 package of economic reforms which called for transforming the district into “a special zone that has competitive regulations and procedures, with visa exemptions”. It called for a direct link to the international airport, which would get around the kingdom’s restrictive entry policies for foreigners, and increasing the real estate and hospitality facilities in the zone to create an “integrated and attractive living and working environment”.

The PIF has chosen JPMorgan as its advisor on the transfer and a feasibility study is currently being undertaken, according to two of the sources, which among other things will establish a valuation of the district and how much compensation will be paid to the PPA.

Construction of the KAFD, which began in 2006, has been beset by problems, most recently involving the project’s master developer, Saudi Binladin Group, with construction delays and workers protesting at the KAFD site over months of unpaid wages. It has also so far struggled to find commercial tenants.