Aldar to acquire full ownership of Etihad Plaza and Etihad Airways Centre
Posted on 27th February 2019
According to *Tradearabia news report, leading UAE-based developer Aldar said one of its subsidiaries, Aldar Investment Properties, has agreed to acquire the full ownership of Etihad Plaza and Etihad Airways Centre in an Dh1.2 billion ($327 million) deal with Abu Dhabi national carrier Etihad Airways.
As part of the deal, Etihad will take 100 per cent ownership of Etihad Airways HQ. The three properties were previously held in three 50/50 joint ventures between Aldar Properties and Etihad. The transaction is expected to be completed in the second quarter.
Etihad Plaza is a mid-rise residential development which houses the national airline's employees in apartments ranging from one- to four-bedrooms and is fully leased to Etihad on a long-term lease expiring 2034.
It also offers a number of retail units comprising offices and medical facilities for Etihad Airways, and retail and food and beverage (F&B) units which are leased out to third parties.
Located within one of Aldar’s completed developments in Al Raha Beach, Al Muneera, Etihad Airways Centre comprises predominantly office space and a retail offering.
The offices are fully leased to Etihad Airways on a long-term lease expiring 2032. The majority of the ground floor retail units are sublet to retailers such as Carrefour, Jones the Grocer, Style and Smile and Al Wahda Pharmacy, with Etihad Airways occupying the remaining retail space on the ground floor.
This deal builds on a transformational 2018 for Aldar, when the Group completed three strategic corporate actions. In March 2018 Aldar entered into a strategic partnership with Emaar; then in May last year, Aldar acquired Dh3.7 billion of high-quality assets.
This was followed in September by the creation of Aldar Investments, the region’s largest diversified real estate investment firm.
This is the first major transaction for Aldar Investments which was launched last September, said the Emirati company in its statement.
On completion, Dh1.2 billion of investment properties and other assets will be acquired by Aldar Investments in exchange for transfer of full ownership of Etihad HQ to Etihad.
As part of the transaction, Aldar will assume existing debt within the Etihad Plaza and Etihad Airways Centre JVs, which will be kept in line with Aldar Investment’s established debt policy to hold 35 per cent to 40 per cent loan to value.
The deal adds 789 residential units, 17,940 sqm net leasable area (NLA) of office space and 11,000 sq m NLA of retail space to Aldar Investments’ existing high-quality portfolio.
Full ownership of these assets will enable Aldar Investments to recognise annualised annual net operating income of Dh0.1 billion, previously reported as a share of profits from the JV, said the statement.
Aldar Investments will also continue to benefit from a strong tenant base with long leases that provide solid visibility of income, remarked its CEO Jassem Saleh Busaibe, who was recently appointed.
In this role, Busaibe, who is also the chief investment officer of Aldar Properties, will oversee the implementation of Aldar Investments’ strategy through the active management and growth of its high-quality portfolio.
"In September, we announced the creation of Aldar Investments to accelerate growth opportunities and unlock value through active management of a diverse portfolio of real estate assets," stated the top official.
"The acquisition of Etihad Plaza and Etihad Airways Centre allows us to drive value as we take these assets into our larger real estate platform, enabling greater capital efficiency, grow our net operating income and ultimately, free cash flow that can support future dividend growth," observed Busaibe.
"The deal continues Aldar’s remarkable start to 2019 and further demonstrates the strength of Abu Dhabi’s real estate market," he added.
*News source: http://tradearabia.com/news/CO...Back to all Construction News
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