Dubai’s first Real Estate Investment Trust launched

 

29 November 2010
Source : DIB

A joint venture that will lead to the creation of Dubai’s first Real Estate Investment Trust (REIT) was officially launched last night (November 23, 2010) at a high-profile event attended by His Highness Sheikh Ahmed bin Saeed Al Maktoum, President of the Department of Civil Aviation and Chief Executive and Chairman of The Emirates Group, and His Excellency Mohammed Ibrahim Al Shaibani, Director-General of His Highness The Ruler’s Court of Dubai and Chairman of Dubai Islamic Bank (DIB), along with more than 100 public and private-sector decision-makers and investors.

Emirates REIT is a new investment opportunity jointly developed by DIB, one of the UAE’s largest financial institutions, and Eiffel Management, a pioneer of REITs in France. The launch of Emirates REIT demonstrates the renewed level of confidence in the UAE real estate sector.

Based in the Dubai International Financial Centre, Emirates REIT is governed by the Dubai Financial Services Authority and will invest exclusively in high-quality, income-producing commercial and residential properties. Emirates REIT will professionally manage the assets in order to maximise revenue and increase the overall value of the company. A key feature of Sharia-compliant Emirates REIT is that at least 80 per cent of the company’s net income must be returned to shareholders annually in the form of dividends.

The company is governed through a Board of Directors comprising Abdulla Al Hamli, Dr. Adnan Chilwan and Mohammed Al Sharif from Dubai Islamic Bank, along with Sylvain Vieujot from Eiffel Management and Mark Inch from Société de la Tour Eiffel.

Abdulla Al Hamli, CEO, Dubai Islamic Bank, and Chairman, Emirates REIT Management, said: “Dubai Islamic Bank is proud to support Emirates REIT, which will have a positive impact not only for the real estate sector but also the UAE’s overall economic environment. Emirates REIT will be run to the highest international standards and highlights Dubai Islamic Bank’s long-standing tradition of excellence and innovation in Islamic finance.”

Sylvain Vieujot, CEO, Eiffel Management, and Vice Chairman, Emirates REIT, said: “Dubai’s first REIT is being launched at a time of improving confidence in the Emirate’s real estate market. As the Middle East economy recovers from the global economic slowdown, international investors, and those in the region, are looking for long-term, low-risk and secure investments in the Middle East. Emirates REIT can offer all of these advantages.”

“Emirates REIT is a move by Dubai Islamic Bank to help fuel growth in the UAE's real estate market by allowing investors to pool income-producing real estate assets under a common management and receive tradable shares in the REIT” said Dr. Adnan Chilwan, Chief of Retail & Business Banking, DIB and Board Member, Emirates REIT. “The new REIT looks to attract Shariah-compliant properties such as commercial and residential buildings, warehouses, schools, hospitals and car parks and convert its rental income into dividends for investors” added Dr. Chilwan.

Emirates REIT is launched with assets contributed by Dubai Islamic Bank and underpinned by long leases from the bank. Emirates REIT will appeal to investors in a number of ways; owners of real estate may also invest by contributing their assets in exchange for shares in the REIT, or make cash contributions that will be used to acquire further assets.
The launch of Emirates REIT is another strategic move by Dubai Islamic Bank to stimulate the local real estate sector and follows the recent restart of home financing activities from Tamweel, in which the Bank is the majority shareholder.