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Emaar Properties to issue benchmark sukuk

Dubai Islamic Bank, Emirates NBD, First Abu Dhabi Bank, Mashreq Bank and Standard Chartered Bank are appointed as joint lead arrangers

UAE-based property developers Emaar Properties is planning to issue benchmark sukuk as the real estate market of Dubai improves, according to the media. The developers have appointed Dubai Islamic Bank, Emirates NBD, First Abu Dhabi Bank, Mashreq Bank and Standard Chartered Bank as joint lead arrangers for a global investor call and a series of one-to-one and group meetings with fixed-income investors.

Emaar properties account for a majority of the new home sales in Dubai. The company’s statement to the Dubai Financial Market says that “A benchmark US dollar senior unsecured sukuk with a 10-year tenor under Emaar Properties’ $2 billion Trust Certificate Issuance Programme may follow subject to market conditions.” This benchmark bond or sukuk is generally classed as a debt issuance of at least $500 million. Bond issuances by Gulf entities are expected to be around $125 million.

It is said that the luxury end of the market is enjoying a boom, with the emirate recording 22 residential sales in the $10 million bracket in the first five months of this year, compared with 19 for all of last year.

Emaar Properties aims to tap into the premium end of the market and generate revenue from operations as it hands over several units in 2021 and the following year. In 2020, it delivered 4,800 units, and in 2021, around 6,000 units are expected to be delivered. By 2022, media reports state that the handovers will increase to 10,000 based on the project completion pipeline.

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