Abu Dhabi-based Aldar Properties is spinning off its property investment arm to create the region’s largest diversified real estate investment company with more than $5.4 billion in assets, the company announced on Wednesday.
The new company – Aldar Investment Properties LLC – will take ownership of some of Abu Dhabi’s highest revenue-generating real estate assets, including more than 5,000 residential units and over 500,000 square-metres of prime retail and commercial space, including Yas Mall and the Gate Towers and Arc.
The announcement follows a recent decree from the government of Abu Dhabi that Aldar subsidiaries can now own property in the emirate.
Aldar Investments has already been assigned a Baa1 rating by Moody’s – above Aldar – which will allow it to access capital on more favourable terms independent of Aldar. Additionally, the company intends to issue a new sukuk in the near future.
“Aldar Investments allows us to accelerate growth opportunities and unlock value for shareholders,” said Aldar CEO Talal Al Dhiyebi.
“We have now created a highly attractive real estate investment vehicle. We believe Abu Dhabi’s real estate industry offers a compelling investment case, bolstered by strong macroeconomic backdrop, commitment to growth and attractive real estate yields.”
Aldar Investments will operate under the direction of its own board in a bid to allow increased transparency, governance and clarity around its cash flows, profit and dividends, while reducing operating and capital costs to enhance profitability.
In a statement, Aldar Properties chairman Mohamed Khalifa Al Mubarak said that the launch of the new company will give investors improved access to the emirate’s economy.
“As the owner of AED 20 billion of prime real estate assets, Aldar Investments provides an opportunity for investors to benefit from Abu Dhabi’s AA rated economy,” he said.
The creation of Aldar Investment comes at a time in which Abu Dhabi’s government is attempting to boost the emirate’s economy through a recently announced $13.6 billion (AED 50 billion) stimulus package.
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