Nakheel does not rule out Reits as fund-raising option

Although Nakheel, the Dubai-based master developer, currently has no plans to launch real estate investment trusts (Reits), it is not ruling out the option to raise funds in the future, Emirates 24|7 can reveal.

“We are not considering launching Reits anytime soon. We will be looking at a number of fund raising options later and Reits might be one,” Nakheel CEO Chris O'Donnell said.

In 2008, Nakheel had plans to raise more than Dh2.8 billion through two real estate investment trusts (Reit).

The company was planning to raise Dh800 million through a residential Reit and another Dh2bn through an infrastructure Reit, with both of them being listed in Dubai and Singapore, O’Donnell had told this website.

The company CEO said recently they plan to launch sukuk (Islamic bond) by year-end by when the debt restructuring process is expected to be completed.

JPMorgan Chase London-based analyst Zafar Nazim, wrote in a report August 26, that Nakheel may issue as much as $3.2 billion of five-year sukuk to pay contractors as part of its debt restructuring plan.

O’Donnell refused to give any figure.

Under Nakheel's debt plan, trade creditors have been offered 40 per cent of what they are owed in cash and the rest through an Islamic bond.

The 60 per cent bond issue needs approval of 95 per cent of creditors.

Nakheel announced earlier that Al Shafar Transport and Contracting Company had started work on the 300 villas in the same project.

Arabtec Holding is expected to start work on 500 villas in Al Furjan project in coming weeks, this website had reported.

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