Damac raises $100m via sukuk

Dubai-based developer Damac Properties has announced that its main property development arm, Damac Real Estate Development, has issued US$100 million (Dh367m) of unsecured debt via a sukuk.

In a brief statement, the company’s chief financial officer Adil Taqi said that the proceeds would 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 by way of a private placement and have been rated as BB by debt agency Standard & Poor’s.

Damac Properties reported a net profit of Dh2.7 billion for the six months to June 30 and a Dh4.7bn turnover. No comparable figures were given for the prior year as it only listed on the Dubai Financial Market in January, but when compared with 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.

The company also said it booked sales of Dh5.1bn in the first half of the year and delivered 1,511 units to customers. This brought the total number of units it has delivered to customers to 14,375.

It finished the period with cash in hand and in its bank balance of Dh8.7bn, which was a 32 per cent increase on the amount held six months earlier.

Emirates NBD was the sole bookrunner for the fund-raising. Legal advice was provided by King & Spalding.


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Michael Fahy

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