IslamicFinance.de

Emirates REIT has issued the first sukuk by a real estate investment trust (REIT) in the MENA region. It's also the first REIT from the region to have a credit rating (BB+). REITs have not traditionally issued sharia-compliant bonds, and have instead preferred to tap conventional debt markets for their financing needs. The only previous issuance of this type was in Malaysia in 2014, when KLCC REIT sold $930 million of Islamic bonds. This new issuance was hosted by The Irish Stock Exchange and relied on underlying wakala and murabaha contracts. The entire timeline of the deal was less than two months. This was to ensure Emirates Reit didn’t miss the favourable issuance window. Standard Chartered Bank acted as sole global coordinator, ratings advisor and joint lead manager of the sukuk issuance.

Dubai's Emirates REIT has given initial price guidance in the low-to-mid 5% for its debut U.S. dollar-denominated sukuk. The issuance of the sukuk is expected to be of benchmark size, which conventionally means the higher side of $500 million. The senior unsecured deal, with an expected BB+ rating by Fitch, will price later in the day.

Emirates REIT will hold fixed income investor meetings until Dec. 1 ahead of a debut dollar-denominated five-year sukuk sale. The issuance is expected to range between $350 million and $425 million. The company has mandated Standard Chartered as sole global coordinator, and Dubai Islamic Bank, Emirates NBD Capital, Standard Chartered and Warba Bank as joint lead managers and bookrunners to arrange the meetings ahead of the planned issuance.

Dubai-based Emirates REIT plans to issue a debut Islamic bond of at least US$300 million by the end of this year. The Syariah-compliant real estate investment trust (REIT) has called a shareholder meeting on Nov 23 to discuss the planned sukuk, which could be issued shortly after that date. The company's total debt as at June 30 was about US$300 million. The loan-to-value (LTV) ratio of the REIT stood at 36.8%, which means there is room for issuance larger than US$300 million, the source added. The company had a portfolio of US$772 million at the end of June. Its portfolio includes mixed-use properties, office buildings and schools in Dubai.

Emirates REIT, one of the UAE’s first regulated Shari'ah compliant Real Estate Investment Trusts listed on Nasdaq Dubai, saw a 13% increase in total portfolio value. The total portfolio value stood at $742 million, a year-over-year increase of $85 million, making it the largest Shari’ah compliant REIT globally. The total property income for the nine months also increased 22% to $36.3 million. The net asset value increased to $1.60 per share, or $480.7 million. CEO Sylvain Vieujot thanked the UAE’s leaders who established a stable financial ecosystem with solid laws and regulations that have allowed the United Arab Emirates to become a world leader in Islamic finance.

Emirates Reit yesterday posted an 8 per cent rise in first-half earnings generated by its properties, thanks to higher rents and service charge ­income. Revenue between January and June reached US$19.1 million, up 7.9 per cent from $17.7m for the same period last year. Net income grew 6 per cent to $44.7m because of a $31m gain from the revaluation of its properties. The company said its investment properties were valued at $613.4m as of June 30, up 9.6 per cent from $559.7m for the year-earlier period. Emirates Reit has $1.3m of property that is being fitted out. About $344m worth of its investment properties have been mortgaged against Islamic financing facilities.

Dubai-based Emirates REIT announced that Eiffel Management has acquired a 25 per cent in the REIT manager that was previously held by Dubai Islamic Bank (DIB). The value of the transaction was not disclosed. The REIT Manager is responsible for running the property portfolio of Emirates REIT and all the operations concerning the REIT. It is incorporated in Dubai international Finance Centre and licensed by DFSA. Following the deal, Eiffel Management will own 100 per cent of REIT manager’s total issued share capital. Emirates REIT reported a net profit growth of 39 per cent to reach $48.5 million in 2014 from $34.8 million in 2013.