Business | Property
Sorouh plans sukuk issue this year to fund projects
Sorouh Real Estate, one of the largest companies by market capitalisation in the UAE, plans to issue a sukuk for an unspecified sum by the end of this year.
- By Himendra Mohan Kumar, Staff Reporter
- Published: 00:33 May 15, 2008
Abu Dhabi: Sorouh Real Estate, one of the largest companies by market capitalisation in the UAE, plans to issue a sukuk for an unspecified sum by the end of this year that will help fund its projects, the company's chief executive officer said on Wednesday.
"We haven't decided on the sukuk amount. It will most likely be finalised by the end of this summer," Mounir D. Haidar told Gulf News in an interview at the Cityscape Abu Dhabi 2008.
Haidar said Sorouh will be releasing Lulu Island and Al Ghadeer mixed-use projects to end-users in Abu Dhabi during the current year. It also has major investment initiatives in Morocco and Egypt.
"Today, our overall development investment is more than Dh45 billion. Our market capitalisation is close to Dh21 billion. Our property investment, not including overseas, is about Dh45 billion. That's without Lulu Island. If I have to include our overseas potential investment and Lulu Island, it will exceed Dh60 billion," said Haidar.
"In Egypt, we are working on the master plan. It is a major development, it's more than Dh5 billion. For Morocco, again it is a major investment. But, right now, we don't have an investment figure."
Asked about Sorouh's debt-to-equity ratio, Haidar said the company has a careful plan for each project. "Some of them are self-financed. For others, the debt-equity ratio depends on the most optimum financial return for the shareholders."
As regards the ownership of lands where Sorouh is building its projects, Haidar said: "Some lands we own, some lands we buy and some lands we co-develop with others."
"Our land bank is more than 20 million square metres spread across Abu Dhabi, Morocco and Egypt. Right now, outside the UAE, we are focusing on the Gulf Cooperation Council (GCC), Middle East and North Africa," he said.
As regards opportunities in other countries that Sorouh may be eyeing, Haidar said: "Of course, we always look for the right opportunities that will bring best returns for our shareholders. We always get invitations to go to India and other countries in the sub-continent."
He said Sorouh's "prim-ary responsibility and commitment is to work for the UAE in general and Abu Dhabi in particular because there's a lot of demand. "Of course, if there are other interesting opportunities anywhere else in the world, we will look at them."
Haidar said Sorouh is scouring for opportunities in Dubai and other emirates and there's a possibility for the company to develop properties there in the foreseeable future.
Regarding Abu Dhabi property market, Haidar said: "The demand is very strong and the returns on investment are healthy. Our net profit last year was more than Dh1,200 million. We expect property demand to be strong for the next 10-15 years because of the short supply in Abu Dhabi.
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