Nakheel plans $2.72bn in REITS
Dubai, February 21, 2008
Dubai property developer Nakheel Group said it is in talks with banks about creating real estate investment trusts (REIT) with asset values of up to Dh10 billion ($2.72 billion) to fund infrastructure and residences.
Nakheel, a Dubai-government owned firm that is developing three palm-tree shaped islands off the emirate's coast, wants to create two REITs; one for infrastructure with an asset value of between Dh5 billion and Dh6 billion, and another for homes with a value of between Dh3 billion and Dh4 billion, chief financial officer Kar Tung Quek said on Thursday.
"We have been talking with some of the banks about a residential REIT and an infrastructure trust," Kar Tung Quek said by telephone. "If the market permits it, we will do it this year."
The REITS will list on the Dubai International Financial Exchange, with possibly a secondary listing in Singapore, Kar Tung Quek said. Nakheel is developing about $60 billion of projects.
A REIT pools capital from several investors to buy and manage income property or mortgage loans. Like stocks, REITs can be traded on exchanges.
Earlier on Thursday, Emirates Business reported Nakheel wants to raise at least Dh2.8 billion in REITs listed in Singapore and Dubai.
The company wants to create a Dh2 billion infrastructure REIT and an Dh800 million residential REIT, Nakheel chief executive officer Chris O'Donnell said, according to the Dubai-based newspaper. The newspaper did not give more details.-Reuters