Abu Dhabi
Mubadala Real Estate plans to expand its real estate portfolio internationally by acquiring stakes in commercial properties through joint ventures, a top executive of the firm said on Tuesday.
The firm also plans to monetise some of its UAE assets by setting up a REIT (Real Estate Investment Trust) in 2019.
“We have a couple of investments in the US in the office building, in retail portfolio in Germany and residential investments in the UK currently. Our strategy is to expand further and look at key cities in Europe, Asia and US for further investments,” said Ali Eid Al Mheiri, executive director of Mubadala Real Estate and Infrastructure without disclosing about the total investment.
He said they are targeting cities like New York, San Francisco, Los Angeles in the US, London, Paris, Berlin, Munich in Europe, Singapore and Shanghai in Asia for further acquisitions to boost their portfolio.
“We have a clear strategy to diversify our portfolio and we need to think real estate as a global platform. Most of our investments are in then UAE, and we want to balance our UAE investments with international investments.”
In the UAE, the firm has four commercial towers and two hotels in Al Maryah Island including Rosewood Abu Dhabi and Four Seasons and residential towers in Zayed Sports City.
Speaking about the real estate market in the UAE, he said there has been a softening of the market in 2017 with rents falling by almost 10 per cent due to oversupply.
“In 2018, there will still be some softening, [but] not necessarily as hard as in 2017 and there will be slight stabilisation of the rates. We expect recovery in 2019.”
“Real estate has a cycle between five to seven years where you have high times and low times. In 2008 you had financial crisis and every seven years real estate recovers and comes down again.”
“Rents across 2017 are stabilising, slowly things will pick up. At Cityscape Abu Dhabi, developers are selling their products and there are long queues so there is a signal that property market is recovering.”
He also said Mubadala Real Estate is looking at setting up a REIT in 2019 or 2020 to monetise assets.
“In our view this is what market requires. Everyone would love to invest in real estate but not everyone has the money to buy this portfolio. When you create an REIT, you give opportunity for people to invest in real estate sector and the only way that you can have a REIT is to have sustainable yielding assets that continue to generate income moving forward.”
Meanwhile, the company unveiled new plans in business and residential segment at Cityscape Abu Dhabi. It introduced plug-and-play concept at Al Maryah Island that gives prospective businesses an opportunity to take on fully-fitted, furnished private micro-offices available on flexible short-term leases.
The firm also said apartments are now available for sale at Rosewood Abu Dhabi and Four Seasons hotels.
