GCC Real Estate Fund to return 60% capital

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Mr. Shailesh Dash, Senior Vice President and Head of Alternative Investments at Global stated that the Fund was launched in 2005 with the intention of taking advantage of the booming real estate market in the GCC region.

The main objective of the Fund is to focus on the development and acquisition opportunities in the GCC's middle-income residential sector. It is important to note that the Fund's investments are all Sharia'a compliant.

The Fund has maintained a balance between income producing assets as well as assets offering capital appreciation.

The Fund has fully invested its capital in a number of excellent real estate opportunities in Kuwait, Bahrain, and Oman over a relatively short period of time.

Mr. Dash further added that the Fund has completely exited from an investment this month which comprised of two buildings in Kuwait.

The investment was made in late 2006 using a 'lease to own structure'.

It is worth mentioning that given the strong pre-sales and high demand for residential property in the GCC, the Fund will be able to return capital from the Hadiya Project in Kuwait which is a middle income housing development.

The project is located in a prime location in Hadiya, approximately 30 kilometers south of Kuwait City.

The Hadiya Project was the GCC Real Estate Fund's first residential plot acquisition.

In Bahrain, the Fund is returning capital from the Saar Gate Project, which is a development project comprised of two phases.

The project has sold 100% of phase one and the infrastructure for phase two is currently in progress.

The Saar Gate Project is located in an affluent suburb of Manama adjacent to the bustling Shiekh Salman highway.

The project consists of 102 villas and 200 apartment buildings.

The total area of the project is 54,773 square meters with a total built up area of 50,110 square meters and is currently generating an IRR in excess of 20%.

The Hail Project is one of the Fund's investments in Oman.

The project has been received exceptionally well by the local community and was 100% sold in a relatively short period of nine months.

The project is the Al-Hail area which is in close proximity to the Al-Seeb Stadium and the Al-Khoudh Shopping Center.

With a total of 100 villas and townhouses built on 34,998 square meters of stunning landscape, the project includes an array of complimentary components of residential units, landscaping, streets, as well as a mosque.

The built up area of the units range between 182 square meters to 315 square meters.

The construction period is estimated to be 18 months. Mr. Dash is confident that this investment will generate an IRR in excess of 40%.

The Qurm Gardens Project in Oman is located in Al Qurm, which is an upscale residential area situated on the coast of Muscat.

The project includes 40 residential villas and a commercial component.

The project has a projected IRR of 50%.

Mr. Rakesh Patnaik, Vice President and Head of Real Estate Funds at Global stated, 'Efforts during the coming quarter will be made to liquidate all the income producing assets as well as the above-mentioned development projects in Kuwait, Bahrain, and Oman, and to return the capital plus profit to the investors'.

Patnaik said that 'The Fund is expected to be fully liquidated and all capital plus profits will be returned to the investors by the fourth quarter of 2009'. He further added, 'The Fund has a five year tenure, although we have been able to achieve our objectives within the initial three years'.

It is worth mentioning that the Fund targeted a compounded annual return of 10 to 20% over the term of the Fund, net of all fees.

The current unrealized IRR is 18%, and Patnaik is confident that the Fund will generate a cumulative IRR in excess of 20% upon exit.

'This shows Global's ongoing commitment to its investors which remains strong as evident by its great achievements in the markets across the region.

The Fund's advisor is Alargan International Real Estate Company.