Dubai: Emirates REIT shareholders approved a proposal to issue sukuk in excess of $300 million (Dh1.1 billion) between the last quarter of 2017 and the first quarter of 2018. The Islamic bond will have a five-year tenor.
“Having access to the debt capital market is strategic for the growth of Reits. This sukuk is an important milestone for us. Emirates REIT will have immediate financial benefits by significantly increasing free cash flow, and removing any rate increase risk which is advantageous in the current market environment,” Sylvain Vieujot, CEO of Equitativa Dubai, the Reit Manager, said in a statement.
Standard Chartered Bank has been appointed as global coordinator, alongside Dubai Islamic Bank, Emirates NBD Capital and Warba Bank as joint lead managers.
A fixed-income investor roadshow in the UAE, Asia and Europe will commence on November 28.
“Going forward, maintaining a credit rating will increase the visibility of the Reit and investor confidence. It will also allow the Reit to take advantage of capital markets, to grow its portfolio and enhance its performance,” Vieujot said.
Fitch Ratings has assigned a long-term issuer default rating of ‘BB+ (EXP)’ with a ‘Stable’ outlook to Emirates REIT and a senior unsecured debt rating of ‘BB+ (EXP)’ to the upcoming sukuk issuance.
