Dubai’s Al Mal Capital raises $95.37mn from its REIT listing

UAE-based Al Mal Capital, an asset management subsidiary of Dubai Investments, has secured about $95.37 million through the public equity float of its real estate investment trust (REIT).

The asset management company in its statement to Dubai Finacial Market (DFM) stated that Al Mal Capital REIT closed its initial public offering on December 8 and secured the regulatory approval to function as a real estate investment fund last week. It will commence listing its shares on the Dubai bourse, after receiving final authorization from the DFM and the Securities and Commodities Authority.

The REIT is planning to acquire a diversified portfolio of real estate properties with long-term lease agreements. The IPO proceeds will be utilized along with Islamic financing from local banks for investment in healthcare, education and industrial property sector assets.

Al Mal Capital is looking to make investments in Sharia-compliant assets in both onshore and offshore zones in the UAE. It targets to achieve an annual 7 percent return, distributing at least 80 percent of its income to investors, according to the bourse filing.

“We are proud that we have successfully raised the required amount for Al Mal Capital REIT, especially during the unprecedented times we faced this year. We are confident that the REIT will continue to meet investors’ needs, as we begin to purchase and acquire income-generating real estate assets.”

Al Mal Capital REIT will be the first to trade on the DFM, the two other investment vehicles in Dubai, Emirates REIT and ENBD REIT are listed on Nasdaq Dubai.

Since 2014, the real estate market in Dubai has faced headwinds due to the oil price fall. Oversupply concerns have added to investors’ concerns, but in recent months the transaction volumes have started to get back in the emirate’s economy after movement restrictions due to COVID-19 were lifted.

As per Property Finder’s report, last month Dubai completed 3,928 property deals worth $2.08 billion, which is the highest amount for nine months. This brought the total number of property deals in the emirate in the first 11 months to 33,537, with a total value of $18 billion.