Sunday, October 8, 2017

ENBD REIT buys prime Dubai office building

ENBD REIT, a Shari’a-compliant real estate investment trust managed by Emirates NBD Asset Management, said it has acquired The Edge, a premier 92,000-sq-ft office building located in Dubai Internet City from developer Sweid & Sweid for Dh280 million ($76.2 million).

The Edge is home to global tech outfit Oracle, social media giant Snapchat, and American education publisher McGraw Hill.

As a prime grade ‘A’ property, The Edge’s tenants enjoy a central and easily accessible address, high-end interior design, sustainable credentials, impeccable building infrastructure and quality facility management, said  statement from ENBD REIT.

The seven-storey development also boasts 233 parking bays distributed over the ground floor and three levels of basement parking, offering tenants one of the highest parking-to-office ratios in the area.

The acquisition utilizes ENBD REIT’s existing Islamic debt facility, meaning that the property portfolio is running at an efficient Loan-to-Value (LTV) ratio of 32 per cent. The entire asset will deliver a gross yield of 7.4 per cent and a net yield of 6.6 per cent.

Tim Rose, the head of real estate at Emirates NBD Asset Management, said: "We are pleased to announce our third acquisition since listing on Nasdaq Dubai in March, and it is fitting that The Edge is a fully-leased, prime grade ‘A’ asset."

With a levered return of nine per cent on equity, this is a strategic acquisition of a flagship building that will provide income and growth in the coming years, thereby providing us with flexibility to engage in a wider range of future investment opportunities, while at the same time delivering strong and consistent returns to shareholders, he stated.

Maher Sweid, the founder and managing partner, said: "Since launching The Edge in 2014, we have received incredible interest in the development. This announcement clearly demonstrates our ability to deliver contemporary commercial buildings of the utmost quality within the exact parameters of what tenants are looking for."

"This unique skill has enabled us to deliver excellent returns for our investors," he noted.

The transaction follows the recent acquisition of a number of alternative assets by ENBD REIT, including the under-construction South View School in Dubai’s Remraam Community at a total value of Dh55 million ($15 million) and the Uninest Dubailand student accommodation building for Dh120 million ($33 million).

ENBD REIT’s total property portfolio value now stands at $447 million. Following the acquisition of The Edge, the UAE group now has a total of 10 assets across Dubai, with a property portfolio value of $447 million.-TradeArabia News Service

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