BKME readies $111m realty fund for Abyaar
Kuwait, June 27, 2009
The Bank of Kuwait and The Middle East (BKME) said it has arranged a new KD32 million ($111.4 million) real estate financing facility for Abyaar Real Estate Development Company.
This facility follows the success of the KD14 million financing extended to Abyaar at the beginning of the year and is a landmark deal in the Kuwait financial sector especially in the wake of the global financial crisis, said a BKME official.
It is collateralized by mortgage of Abyaar-owned income generating real estate properties.
On signing the MoU for the new deal, BKME chairman Hamad Abdul Mohsen Al-Marzouq said:' Since the beginning of the crisis, we have always been keen to provide the necessary finance for several key sectors, particularly the real estate sector.'
Abyaar has posted notable growth over the past few years through entering new markets, diversifying its sources of income, and launching several innovative, Sharia-compliant projects, he explained.
'We at BKME have an experienced and seasoned team of professionals, which enables us to understand the needs of the market and to assist local companies by providing them with the required tailor made solutions for their financial needs, while continuing to adhere to the prudent credit policies of by the Bank.'
'Abyaar enjoys a strong financial strength. The transparency of its management in dealing with us was crucial in the expeditious finaliziation the financing facilities', Al-Marzouq added.
Abyaar chairman Hesham Abdul Wahab Al Obaid said:' We have strong relationship with BKME and we finalized earlier this year a financing transaction viewed as the first of its kind in the financial sector in Kuwait, when BKME swiftly responded to our financing needs despite the implications of the global financial crisis.'
'The primary objective behind the new financing deal is the completion of the company's projects under construction, and the rescheduling of its local and foreign financial obligations, whether due or not yet due', Al Obaid added.
Al Obaid explained that the new financing deal is estimated at around KD18 million, with the agreed tenor being up to 5 years, whereby the funds will be received by Abyaar in tranches upon the completion of the respective projects.
Abyaar has been granted the finance against real estate collaterals with market value substantially exceeding the value of the facility, he noted.
The belief of BKME in the performance of the company and its operations that capitalizes on fixed- income generating real estate assets, was a major factor in the successful completion of the financing deals, Al Obaid pointed out.
'We highly appreciate BKME’s constant support in meeting the requirements of the national companies. We hope that this agreement will further extend the fruitful co-operation between the two institutions, and will be the beginning of a long-term relationship based on professionalism and transparency', he added.-TradeArabia News Service