ENBD REIT's Q3 property portfolio value down to $366mln

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ENBD REIT (CEIC), the shari’a compliant real estate investment trust managed by Emirates NBD Asset Management, has announced that its net asset value as of December 31, 2020 stood at $184 million ($0.74 per share) as compared to $198 million in September and $246 million the year before.

ENBD REIT pointed out that its value of the property portfolio has been adjusted down to $366 million (from $377 million in September 2020, and $429 million in December 2019). The decrease in NAV has resulted primarily from market valuation pressure, it added.

While the balance of asset valuations in the property portfolio has remained stable, pressure has been driven by capital works for refurbishments at Al Thuraya Tower 1 in Dubai Media City; ongoing discussions around non-payment of rent at the Uninest student accommodation building in Dubailand; and pressure on residential rental rates due to competitive market conditions.

Blended portfolio occupancy remains stable at 75% compared to 76% for the previous quarter. The Weighted Average Unexpired Lease Term (Wault) for the portfolio has been maintained above 4 years (at 4.01, compared with 4.05 in in September 2020 and 3.37 in December 2019), due to proactive leasing efforts and renewals by major tenants.

ENBD REIT’s management has focused on securing longer-term leases for all renewals and new leases, particularly in the office portfolio.

Anthony Taylor, the head of real estate at Emirates NBD Asset Management, said: "As we continue to face pressure on valuations, we are taking an active approach to both leasing and asset management, in order to uphold healthy occupancy levels and make our properties as attractive as possible to current and prospective tenants."

"Subdivision works at Burj Daman in DIFC have been completed to create smaller, more leasable units on the 10th and 14th floors, with furnished options also available to new tenants, and active leasing set to kick-off in February. Meanwhile, our major refurbishment project at Al Thuraya Tower 1 is underway, with the design phase finalized," stated Taylor.

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