Dubai: Aldar Properties will revisit investment opportunities in Dubai for ‘all kinds of options’, according to a top official at the Abu Dhabi headquartered mega-developer.
“We have looked at Dubai for a long time – investments could be through straight up acquisitions or joint ventures,” said Greg Fewer, Aldar’s Chief Financial and Sustainability Officer. “Aldar’s plan has always been to deploy capital effectively to enhance the platform’s (prospects) for future growth.”
As Fewer said, Dubai has been on Aldar’s radar for some time, and steps were taken to take up projects in the emirate through an alliance with Emaar. But then COVID-19 intervened and the two parties decided to ‘focus on their own backyards’.
Call on billions
The Abu Dhabi company thus wants to have a fresh start on its plans for Dubai. It can call on Dh5 billion in free cash available, which Aldar plans to deploy over the next 12 months as equity on fresh transactions. Some of that could land up in Dubai.
In the first-half, Aldar had been using some of its sizeable resources on acquiring prime resorts, plots and a mall in Ras Al Khaimah and ‘islands’ within Abu Dhabi through a deal on Nurai. This week, ahead of its announcement of H1-2022 results, the developer bought a resort – DoubleTree by Hilton in Ras Al Khaimah - and four office towers on Al Maryah Island in Abu Dhabi. The latter deal, at Dh4 billion and change, is one of the biggest real estate transactions in the UAE to date.
The RAK plans
On whether Aldar wasn’t investing in mature assets offering stable rather than spectacular results, in Ras Al Khaimah, Fewer said: “They are mature assets, but we bring with us a most efficient platform for property ownership. There is the lower cost of capital that we can bring in, plus strong asset management capabilities.
“At Al Hamra Mall, we will be sending a team to refresh the property, enhance the retail mix and (in future get) more rents. This has been an excellent mall for some time.
As for the two resorts - Rixos and DoubleTree by Hilton – Aldar owns in Ras Al Khaimah now, these will be integrated into the existing hospitality portfolio. “We have a strong asset management team with the proven ability to go in, bring efficiencies and scale them up,” said the CFO. “Aldar has a history of doing that and applying best-in-class practices. We are consolidating our positions in Ras Al Khaimah, and very happy with the portfolio developing there.”
Equity and debt
On future acquisitions, Fewer said that the 60:40 split between equity and debt will be maintained, and that Aldar has locked in leverage at ‘fixed rates by taking advantage’ of the lower interest rates available last year. “There are many avenues of opportunities for someone like us,” said Fewer.
Clearly, from the spate of deals it has been a part of, and topping that up with the Dh4.3 billion for the Al Maryah Island towers, Aldar sure knows how to.