Dubai-based real estate development and hospitality group FIVE Holdings is expected to close financing for two of its ventures in the coming weeks, the company’s CEO said.
FIVE Holdings, previously known as SKAI Holdings, launched a 2.1 billion UAE dirham ($570 million) real estate investment trust (REIT) last week, calling it the region’s first hospitality-focused REIT and the largest to date. Thomson Reuters Projects reported on Sunday that the company was planning a dual listing of the REIT in the United Arab Emirates and an Asian markets in 2019. The company also plans to break ground on a new project this year.
“We’ll be announcing a (bank) facility in two weeks for one of our other projects and also for the REIT,” Kabir Mulchandani, chairman and CEO, FIVE Holdings, told Thomson Reuters Projects in a phone interview late last week.
“It’s not signed but very close to signing,” he said.
He added that the company would be repaying the debt owed on Viceroy Dubai Palm Jumeirah 15 months ahead of schedule.
“We will be repaying the facility in its entirety in July,” Mulchandani said.
“It was a $300 million facility and it’s down to $25 million. We should be clearing this or the next month.”
The syndicated finance package, secured in 2015, was a dual Islamic and conventional facility backed by seven local and major Chinese financial institutions, including Abu Dhabi Islamic Bank, Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Minsheng Banking Corp, Invest Bank and Arab African International Bank.
The early repayment has helped draw support from banks for the firm’s new projects, Mulchandani added.
“They’re (the banks are) really happy that they got paid early and they’d like to redeploy again,” he said.
The REIT will initially be unlisted and regulated by the Abu Dhabi Global Market and the Financial Services Regulatory Authority.
REITs issue securities in the form of shares that invest in income generating real estate including mortgages and may be traded like a stock when offered to the public.
In addition to FIVE Holdings’ Palm Jumeirah project, the REIT is expected to include the 1.28 billion UAE dirham Viceroy Dubai Jumeirah Village, which is due to open next year, the company said in a statement.
FIVE Holdings’ $2 billion real estate portfolio also includes projects in Jumeirah Village Circle and Jumeirah Beach Residence.
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