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Dubai bank Emirates NBD to IPO Islamic REIT fund

Emirates NBD (ENBD), Dubai’s largest lender, plans to offer shares in its Islamic real estate investment trust and list them on the Nasdaq Dubai exchange.

ENBD REIT said on Sunday it expects to raise about $100 million to $125 million from the offering and plans to use its proceeds to fund acquisitions of real estate assets.

The trust’s current portfolio consists of seven properties in the commercial and residential sector, which are all located in Dubai, it said.

ENBD REIT’s assets have a total valuation of $314 million, with a net leasable area of 872,518 square feet as of Sept. 30 2016.

“This will be only the second real estate investment trust to be listed on a UAE stock exchange, and it is the opinion of ENBD REIT’s directors that the re-domiciliation and listing will allow improved liquidity and greater flexibility for the Fund Manager to manage ENBD REIT,” said Tariq Bin Hendi, Director of ENBD REIT.

“The improved capital structure of ENBD REIT will mean there is less of a requirement to retain cash for the purposes of managing liquidity in the event of investor withdrawals, which are not permitted in a closed-ended vehicle of this type, but were a requirement in the open-ended structure. In the long-term, this should help ENBD REIT to achieve its objective of remaining more fully invested, subject to market and other conditions, with the goal of achieving improved long-term returns for its shareholders,” said Anthony Taylor, Fund Manager, Real Estate at Emirates NBD Asset Management Limited.

(With inputs from Reuters)