ABU DHABI 8 June 2017: Emaar Properties will offer up to 30 per cent of Emaar’s UAE Real Estate Development business through a share offering on the Dubai Financial Market (DFM). The funds raised through the sale of equity will be primarily distributed as dividends to Emaar’s shareholders.
The decision to list Emaar’s UAE Real Estate Development business was a result of an internal review of Emaar’s asset values. This indicated the importance of highlighting the value of this business as a major contributor to the overall profitability of Emaar through an independent listing.
Emaar’s real estate development in UAE has recorded significant growth over last five years. Real estate sales increased from Dh4.2 billion ($1.14 billion) in 2012 to Dh14.4 billion ($3.92 billion) in 2016. Until end of May 2017, the business recorded sales of Dh9.7 billion ($2.64 billion), 24 per cent above the same period in 2016. Total backlog as at the end of May 2017 is Dh40 billion ($10.9 billion). This backlog represents the value of properties sold but where related revenues have not been recognised.
Additional Dividend
Mohamed Alabbar, Chairman of Emaar Properties, said: “The proposed listing and the additional dividend to our shareholders including Government of Dubai underlines our commitment to provide superior value to all our shareholders for their unwavering support to the company since its inception in 1997.
“Over the years, we have generated significant returns from our UAE real estate development business and it continues to be a strong driver of growth for the group. As Emaar’s other businesses have grown and expanded, we wanted to ensure that investors who value the UAE Real Estate Development business the most, the foundation of Emaar’s success, can do so directly. This will ensure that the value of this business is properly recognised, thereby enhancing value for all Emaar shareholders.”
Alabbar added: “We are drawing on our success to create a new Emaar defined by an expanded development pipeline in Dubai anchored by iconic structures such as The Tower at Dubai Creek Harbour. Emaar’s value proposition is an unwavering commitment to provide the best-in-class service to our customers, which will be the main pillar for the UAE Real Estate Development business to achieve significant successes. We have high-calibre professionals who lead our various businesses and we are also investing in young talent.”
34,000 Units Created
Emaar has handed over around 34,000 units in Dubai since 2001 and currently has a significant land bank of 24 million sqm in the UAE. The total development area on these lands is approximately 30 million sqm.
Focused on its strategy of shaping the future today, Emaar has several mega-developments ongoing in Dubai including the 11 million sq m Dubai Hills Estate, a ‘green city within the city,’ developed as a joint venture with Meraas Holding, which will feature a world-class retail hub and an 18-hole championship golf course.
Having delivered the iconic Burj Khalifa, Emaar is now developing The Tower in Dubai Creek Harbour, billed to be one of the fascinating attractions in the world. It is set in the heart of a 6 sq. km mega-development, developed as a joint venture with Dubai Holding and will feature a dedicated retail district for high-end brands.
Another smart development for the future, set near the venue of Expo 2020 Dubai, is Emaar South, a next-generation lifestyle destination in the new aviation and logistics hub of the city, Dubai South.
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By Angel Chan