Dubai's Emirates REIT sells DIFC property for $11mln

Fund looks at ways to restructure after bondholder reject earlier

  
A general view of The Gate building at Dubai International Financial Centre (DIFC) in Dubai, United Arab Emirates June 23, 2019. Picture taken June 23, 2019.

A general view of The Gate building at Dubai International Financial Centre (DIFC) in Dubai, United Arab Emirates June 23, 2019. Picture taken June 23, 2019.

REUTERS/Christopher Pike

Dubai-based Emirates REIT, which was earlier this week forced to withdraw a restructuring proposal for its $400 million dollar sukuk, or Islamic bond, following investor opposition, said it sold half of a shell and core office floor in in the Dubai International Financial Centre (DIFC) for 40 million dirhams ($11 million).

The sale made a valuation gain of 18 million dirhams, compared to the latest valuation of the space, Equitativa (Dubai) Limited, the manager of Emirates REIT, the largest Sharia-compliant real estate investment trust, said Thursday.

Commenting on the sale, Sylvain Vieujot, the group chairman of Equitativa, said the REIT “is increasingly well positioned to implement its turnaround strategy”.

Emirates REIT failed to secure the 75 percent shareholder votes needed to go ahead with the planned restructuring, which would have included the offer to exchange the unsecured sukuk securities due in 2022 for new secured notes maturing in 2024 as a way of bolstering its balance sheet.

A group of bondholders--including local and international funds and banks—said to represent around 40 percent of the sukuk holders, had last month decided to oppose the offer.

(Writing by Brinda Darasha; editing by Daniel Luiz)

brinda.darasha@refinitiv.com

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