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Diyar Al Muharraq seals $366m project finance deal

MANAMA, September 28, 2016

Diyar Al Muharraq, one of the leading urban developers in Bahrain, has signed a Murabaha contract worth $366 million with a group of local banks in order to provide financial liquidity to develop the ‘Deerat Al Oyoun’ project.

The agreement was signed by the developer with leading lenders including Al Salam Bank – Bahrain, Kuwait Finance House, Bank of Bahrain and Kuwait and Al Baraka Islamic Bank of Bahrain at a key ceremony held at the Four Seasons Bahrain Bay Hotel in Bahrain.

It was attended by senior officials including Yousif Abdulla Taqi, the director and group chief executive officer of Al Salam Bank – Bahrain; Abdulhakeem Al Khayyat, the managing director and CEO of Kuwait Finance House; Reyadh Yousif Sater, the chief executive (Business) of Bank of Bahrain and Kuwait; Mohamed Isa Al Mutaweh, the chief executive of Al Baraka Islamic Bank; Sheikh Ahmed Bin Isa Al Khalifa, the chief financial resources of the Ministry of Housing and Dr Maher Al Shaer, CEO of Diyar Al Muharraq.

The participating banks will fund the ‘Deerat Al Oyoun’ project with $366 million in the form of partial funding, which approximately costs $700 million.

Diyar Al Muharraq will bear the responsibility for financing and constructing all units of the social housing project as well as the initial infrastructure and public utilities.

Located in the heart of Diyar Al Muharraq, the ‘Deerat Al Oyoun’ will span across 1.2 million sq m and will comprise an idea residential community with integrated community services centers and green pack spaces.

Its strategic location also places it in close proximity to schools, shopping malls, public beaches, recreational facilities, mosques, medical facilities, and a modern transportation network. The anticipated date for the project’s first phase completion is February 2018.

Commenting on the agreement, Al Khayyat said: "It is our pleasure to play a key role in supporting this housing project by offering financial solutions and services that are Shari’a compliant. We are honoured to consolidate our participation in the growth of development projects in Bahrain and supporting innovative initiatives that aim to attract huge funding that contributes to the kingdom's economy and provides suitable housing solutions for Bahrainis. I would also like to extend our gratitude towards the Ministry of Housing, the Central Bank of Bahrain and the participating banks for their continuous efforts in supporting this initiative."

On the deal, Al Salam Bank Deputy Group CEO (Banking) Anwar Murad said: "We are delighted to have played a key role in co-financing the project worth of BD138 million ($366 million) and acting as the “Mandated Investment and Security Agent” of the Deerat Al Oyoun project which will offer affordable social housing units in accordance to the standards of the Ministry of Housing."

He pointed out that the agreement was a milestone in terms of organizing and financing a project of this magnitude, stressing on the cooperation between Islamic and conventional banks in the region.

"Being one of the pioneering Shari’a compliant banks in the Kingdom, we always strive towards building long-lasting relationships with the public and private sector and the citizens of Bahrain, reflecting the importance of supporting such initiatives that are designed to improve the Kingdoms infrastructure and real estate sector," stated Murad.

"Al Salam Bank – Bahrain will continue to put its efforts in exploring new and innovative Shari’a compliant products and services tailored to meet the changing needs of the market place and our customers," he added.

KFH-Bahrain's executive manager and head of corporate banking group Sattam Al Gosaibi said: "We are extremely appreciative to be a major contributor and organizer of this co-financing project that aims to facilitate the social requirements of Bahraini citizens."

"In this regard, we extend our thanks to Al Baraka Islamic Bank and the Bank of Bahrain and Kuwait for their financial contribution and Al Salam Bank – Bahrain for playing the role of the investment and security agent as well as being a financial contributor," he noted.

On the deal, Dr Al Shaer said: "We are delighted to sign this agreement with the participating banks, which will ensure Deerat Al Oyoun social housing adequate funding and operation in accordance to schedule."

"Part of our strategy at Diyar Al Muharraq is to attract huge investment opportunities which will reinvigorate the northeastern coast of Muharraq, making it an ideal residential area for Bahraini citizens, offering them integrated services including recreational facilities, medical facilities, shopping malls, a modern transportation network and more," he noted.

Diyar Al Muharraq is a unique master planned city for the people of Bahrain offering a range of housing options and quality lifestyle. It offers a cohesive mix of residential and commercial properties with a strong lineup of projects aimed at creating a long term and sophisticated township.

"We look forward to achieving this ambitious housing project and the strategic partnership between the public and private sector in deep cooperation with the Ministry of Housing, which aims to provide suitable and convenient housing solutions for Bahrainis. During the past week only, we launched the reservations and sales of the first phase Deerat Al Oyoun’sproject for the beneficiaries of the Mazaya Scheme, with 133 units put up for sale," he added.-TradeArabia News Service




Tags: Bahrain | project | finance | Diyar al Muharraq |

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