Damac raises USD 100 million through sukuk

Dubai master developer Damac Real Estate Development is looking for cash for their new large real estate projects in UAE.

Adil Taqi, a chief financial officer in Damac, said that debt certificates issued by Damac recently will be used “for general corporate purposes and for the acquisition of land plots to strengthen and extend the company’s development pipeline, in accordance with our medium-term funding strategy”.

The 18-month debt certificates were secured through private placement and have been rated as BB by the debt agency Standard & Poor’s.

Walid Bellaha, an emerging markets analyst with Barclays, said “The free cash the company has available is only about $350 million. They want to have this flexibility for cash. They have started paying significant dividends and they still plan on [launching] new projects.”

Damac Properties six months net profit in 2015 was about USD 740 million, and the total turnover — about USD 1,28 billion. The company’s financial performance results for the previous year are not available, for Damac is only listed at the Dubai financial market since January, but when compared to its London-listed predecessor Damac Real Estate Development its figures represented a 57 per cent hike in profit and a 30 per cent increase in turnover.

Today Damac Properties is one of a few leading construction companies in Dubai. Developer’s portfolio includes large and city-forming projects like Akoya by Damac, a residential, commercial and hospitality real estate luxury complex, Naya Tenora, and even such exotic projects as Ettore 971 villas under Bugatti brand presented recently at the Cityscape Global.

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