Emirates Reit owner Equitativa to build up assets in Abu Dhabi property funds

The company behind the UAE’s first real estate investment trust (Reit) in Dubai is pressing ahead with plans to launch new property funds in Abu Dhabi and looking to expand its model to Saudi Arabia.

Equitativa Real Estate, the umbrella company that owns the Reit manager for Nasdaq Dubai-listed Emirates Reit, said yesterday that it was looking to purchase assets to put into four new property funds which it intended to list in the UAE.

The company, which recently set up an asset management branch in Abu Dhabi’s new fin­ancial free zone Abu Dhabi Global Market, has established four new funds; Hospitality Property Fund, Logistics Fund, The Residential Reit and Sportativa.

Equitativa said that the new funds, which are expected to focus on purchasing hotels, warehouses, homes and sporting assets, would not compete with Emirates Reit, which currently specialises in owning and operating a portfolio mainly comprising offices and schools in Dubai.

“Through Equitativa we have started new Reits in Abu Dhabi,” said Sylvain Vieujot, chief executive of Emirates Reit Management, the company which manages Emirates Reit. “The idea for all the Reits we are doing is initially to start building a portfolio, earn a track record and once we have this to look at the market.”

Last week investment man­ager Abu Dhabi Financial Group revealed plans to manage Dh375 million Goldilocks Investment Company, which rather than being traded on the country’s existing exchanges, is expected to be traded on a new platform currently being set up by ADGM.

Mr Vieujot said that it was too early to decide on which of the UAE markets the company would float the new Abu Dhabi- based funds.

“There are many opportunities to float them in the UAE,” he said. “There are several markets here. The situation can change between now and then, so we don’t have any fixed plan on the specific markets.”

Equitativa also said that it was considering establishing a new Reit in Saudi Arabia following the government’s decision earlier this year to allow real estate investment trusts to operate in the kingdom, potentially opening up a huge and lucrative market to investors.

Yesterday the Saudi Capital Market Authority issued the country’s first rules regulating the way in which Saudi Reits operate.

“We are looking very carefully at this market in terms of regulation, in terms of potential partners for us and also in terms of the market itself which is a bit on a turning point at the moment,” Mr Vieujot said. “We think it can be very interesting but until today we have not done anything in Saudi.”

The news came as Emirates Reit reported that third-quarter net profit edged up 4 per cent compared with a year earlier, despite a slowing Dubai office market.

Emirates Reit reported that net profit for the three months to the end of September 2016 rose to US$11.3 million, up from US$10.9m a year earlier.

The Nasdaq Dubai-quoted company reported a 22 per cent boost to net rental income for the period to US$8.9m as the real estate investment trust rented out further office space at its biggest asset, Index Tower in DIFC.

lbarnard@thenational.ae

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