Tecom Group buys Dh1.7 billion in commercial, industrial assets in Dubai
DFM-listed zones operator is also adding new office space at flagship Dubai Internet City
Dubai: The Tecom Group has bought new commercial and industrial real estate assets in Dubai as part of a Dh1.7 billion 'strategic plan' announced in May last.
This was done in conjunction with a move to develop Grade-A office spaces valued at Dh340 million in Dubai Internet City, through the launch of Innovation Hub Phase 3. It brings the total value of Tecom investments in 2024 to more than Dh2 billion.
This will in turn raise the combined Tecom commercial asset portfolio to over 10 million square feet of gross leasable area (GLA) and its land leasing portfolio to 179 million square feet, 'reinforcing its role as a strategic driver in Dubai’s business sector and its leading position at the forefront of the commercial and industrial real estate market'.
“The new strategic acquisitions and projects worth Dh2 billion reflect Tecom Group's vision of fostering sustainable growth,” said Abdulla Belhoul, CEO.
The new spending comes as demand for commercial - and industrial - real estate records further growth. Through the last year, the city's Grade A office space has had limited vacancy. New offices coming to market, such as those at Uptown Dubai tower, were picked off even before the project was completed.
Where and what is Tecom spending on?
It has started development of six Grade A office buildings in Phase 2 of Dubai Design District (d3). This will span a gross floor area of 629,000 square feet and will cost Dh825 million.
"Phase 2 of d3 is a landmark development that will significantly contribute to Dubai’s thriving design, fashion, and creative sectors," said Belhoul.
The new offices will add up to gross leasable area of more than 500,000 square feet. It will be complete by H1-2028. "It promises to deliver substantial long-term growth and further elevate our design sector’s infrastructure, enabling d3 to attract global talent and solidify Dubai’s position as a premier global centre for culture and creativity,” said Belhoul.
More offices at Internet City
The new offices at Dubai Internet City are part of the Innovation Hub Phase 3, and scheduled for completion in mid-2027. The GLA will be more than 167,000 square feet.
It closely follows the launch and build up of Phase 2 of Innovation Hub, which offers a GLA of 366,000 square feet and is 'fully leased ahead of its scheduled delivery date of early-2025'.
Tecom has also bought two operational Grade-A office buildings at Dubai Internet City through a Dh420 million transaction that will add 334,000 square feet of GLA to the group’s commercial portfolio. (The buildings already have a 'high occupancy rate' supported by regional and international companies, ensuring 'positive contributions to the group’s revenue stream from this year'.
Financing the new spending
In a statement, Tecom said it will 'continue to maintain healthy leverage and liquidity position post transaction completion'. And that its 'solid financial position and improved credit terms' create the flexibility needed to 'seize strategic opportunities and support future growth'.