Aldar raised debt of Dh34m in 2007 to fund realty projects

 

 

Abu Dhabi-based Aldar Properties has raised a total debt of Dh34 billion by the end of 2007, and plans to raise further funds to finance its property portfolio of more than $65 billion (Dh238bn), a top company executive said.

 

“We will be back into the market in 2008 and will be raising funds as we go ahead,” Ronald S Barrott, Chief Executive Officer, Aldar, told Emirates Business. “We are looking at various capital instruments and analysing which one will suit the occasion and timing for the group.”

 

He, however, did not disclose the amount that it plans to raise.

 

Barrott also ruled out the chances of launching any real estate investment trusts (Reits).

“Reits is not at all a product for this market since there is no tax in the country. It does not sit well for a development firm, but sits well for an investment company.”

 

Aldar needs to raise between $10bn and $15bn over the next three to five years as part of its development plans, Chief Financial Officer Shafqat Malik told Reuters recently.

 

“Our cash requirements over the next three to five years are between $10bn to $15bn, which will be funded through our sales programme, which is one part, and the debt financing,” he said.

 

According to Barrott, the company is planning to expand across the Gulf Co-operation Council next year.

 

“We will be entering the GCC market in 2009. We are also looking at things in Libya but nothing has been fully decided.”

 

The company has already entered Malaysia in partnership with Mubadala Development Company, while in Kazakhstan it has a partnership with Al Maabar, which is a joint venture company created by Aldar, Al Qudra Real Estate, Sorouh Real Estate, and Al Reem Investments. Barrott believes value of properties in Abu Dhabi will outstrip Dubai in the next few years.

 

“The two cities have totally different models, with Abu Dhabi growing in a sustainable manner. Prices have improved since we commenced selling to nationals in 2005 and to all nationalities since 2006,” he said.