Dubai: The mega-developer Aldar delivered another blockbuster first-half, with net profit surging 57 per cent to Dh3.3 billion. The ADX listed company, which in recent weeks has been raising its visibility in Dubai real estate too, had revenues of Dh10.9 billion, a gain of 73 per cent. (Of this, the April-end June period provided Dh5.3 billion to the top-line.)
The latest Dubai launch was for a Grade A office tower on Shaikh Zayed Road, with net leasable area of 88,000 square metres. In addition, the Abu Dhabi headquartered Aldar also doubled down on its logistics real estate investments, including a tie up with DP World for a logistics park.
Strategic entry into Dubai commercial segment through a total commitment of Dh1.8 billion, with development of an iconic office tower development with a net leasable area of 88,000 sqm on Sheikh Zayed Road and acquisition of ‘6 Falak’, a newly built Grade A office building located in Dubai Internet City.
We are entering into one of the most exciting periods of activity and growth in Aldar’s history.
On its corporate tax obligations, Aldar’s ‘effective tax rate’ for H1-2024 was at 4.1 per cent. The pre-tax net profit shot up 63 per cent to Dh3.5 billion in H1-2024 and increased 42 per cent to Dh1.8 billion in Q2-2024.
“With 79 per cent of our UAE residential sales coming from overseas and expats buyers, we are experiencing a significant expansion of our customer base and benefiting from the country's appeal to international investors,” said Talal Al Dhiyebi, CEO of Aldar.
“At the same time, our investment portfolio is thriving amid favourable economic conditions and driven by strategic acquisitions over the last couple of years.”
A Dh7.7b intake
Property sales in Q2-2024 amounted to Dh7.7 billion, up 10 per cent, helped by serious spikes in overseas buyers acquiring homes in the UAE. Aldar’s overseas entities, Sodic in Egypt and UK’s London Square, ‘continue to pursue scale’ (and) ‘their contributions are expected to intensify in the coming periods’.
What’s coming
The revenue backlog for Aldar reached its highest point to date, at Dh39 billion, at the end of H1-2024. This provides for ‘strong visibility on revenue’ across UAE and International operations over the next 2-3 years. On the project side, Aldar has Dh32.9 billion under construction, which includes two residential communities in Dubai apart from multiple projects in Abu Dhabi and Ras Al Khaimah.
“The UAE real estate market continues to display solid fundamentals driven by strong end-user demand and increasing global investor interest,” said Mohamed Khalifa Al Mubarak, Chairman, in a statement. “This is reflected in Aldar’s strong financial and operational performance in the first six months of 2024," he added.
On the new Shaikh Zayed Tower project, Faisal Falaknaz, Aldar’s CFO, said the intention is to build a project that is ‘currently unavailable in Dubai’s onshore office property market’.
“Not just that, the location is one of the last few in that area, with one side facing SZR and the other the DIFC (hub),” said Falaknaz. He dismissed suggestions that the project was coming to market at a time when there are multiple projects that will offer Grade A commercial space. It will also have a hotel and branded residences.
But as the CFO said, the majority of these are in free zone jurisdictions. And by having one outside of a free zone merits its advantages when it comes to leasing.
Meanwhile, Aldar also plans to launch an ‘ultra-luxury’ mixed use development in Abu Dhabi’s Al Fahid Island later this year.
