First IPO in three years: listing on DFM in January ’21
BBN Report
DUBAI/November 19-2020: The subscription period for the AED500-million initial public offering (IPO) of the AL Mal REIT has been extended until December 8, an additional period of 19 days.
The IPO launched by Al Mal Capital for its newly founded entity that opened on November 8 has originally been planned to close on November 19.
The Al Mal REIT IPO has become the first such offering in three years. The company said the extension is in line with the company’s decision to add more days to the subscription period and in accordance with the terms outlined in the fund’s prospectus.
Offer size AED500 mn
Al Mal Capital, the REIT’s fund manager, announced last month that it received the Securities and Commodities Authority (SCA) of the UAE approval to float Al Mal Capital REIT, a closed-ended real estate investment trust with a target offer size of AED 500 million.
Al Mal Capital REIT intends to list its units on the Dubai Financial Market (DFM’) in January 2021.
Eligible investors can subscribe through First Abu Dhabi Bank (FAB) or the DFM eIPO platform at a subscription price of AED1 per unit and a subscription fee of AED 0.02 per unit.
Naser Al Nabulsi (seen in the picture), Vice Chairman and CEO of Al Mal Capital said that the region is currently underserved with listed REITs, which is why Al Mal was excited to introduce Al Mal Capital REIT.
‘Issue well subscribed’
“The REIT’s IPO has been well subscribed to date, and we have been approached by new investors asking for further time to assess the opportunity and go through the required steps to complete this,” Nabulsi added.
He also said that the investors gravitate towards investments in REITs because they provide a stable income for a low investment entry cost.
First REIT IPO
Al Mal Capital REIT is the first REIT IPO on the DFM and plans to acquire a diversified portfolio of real estate properties targeting long-term lease agreements.
The proceeds will be utilised to invest in a diversified portfolio of high-performing UAE sectors, including healthcare, education and industrial assets, with a target annual return of 7 per cent.
The company said the fund manager will secure an income through the acquisition of income generating real estate in high growth sectors with high occupancy and single let assets, while entering long term lease arrangements with tenants with strong credit profiles. The REIT will focus on acquiring onshore and offshore assets in UAE, in addition to targeting investments in Shariah-compliant assets through Shariah financing structures.
