16 December 2021

ENBD REIT Announces Debt Refinancing Through Emirates NBD and Commercial Bank of Dubai

  • Entire debt consolidated into USD 200 million equivalent syndicated Shari’a-compliant structure
  • Major milestone in strengthening capital structure for a longer-term period
  • Attractive terms set to reduce cost of financing going forward

Dubai, United Arab Emirates, 16 December 2020: ENBD REIT (CEIC) PLC (“ENBD REIT”), the Shari’a compliant real estate investment trust managed by Emirates NBD Asset Management Limited, has announced the successful refinancing of its entire existing debt through a USD 200 million equivalent syndicated Shari’a compliant Murabaha facility with Emirates NBD and Commercial Bank of Dubai. The facility was successfully syndicated by Emirates NBD Capital, the investment banking arm of Emirates NBD, acting as the bookrunner.

ENBD REIT’s drawn debt facilities comprise of USD 45 million with Standard Chartered Bank and USD 150 million with Mashreq Bank. The consolidation of the company’s debt into one syndicated facility will improve the REIT’s overall capital structure and reduce the cost of financing going forward. 

The 5-year facility is profit only and includes a cross currency swap to improve overall pricing. The improved profit margin is likely to result in over USD 7 million of savings on ENBD REIT’s financing costs over the term of the facility. Favourable financial covenants will also support ENBD REIT’s profit coverage ratios and Loan-to-Value ("LTV") which will be less than 60% under this new facility. As the financing has been provided by a related party, management has taken the necessary steps to ensure it complies with all regulatory requirements.

Anthony Taylor, Head of Real Estate at Emirates NBD Asset Management, said:

“The timely refinancing of our entire debt into a new facility at attractive terms is a major step in strengthening our financial position as we begin to emerge from the pandemic. We are pleased to have secured this long-term commitment from Emirates NBD and Commercial Bank of Dubai which enables significant cost reductions and positions us well to seek further opportunities to realise value for shareholders in the future.

We’d like to take this opportunity to thank Standard Chartered and Mashreq Bank for all their support over the last 3 years, during what has been exceptionally challenging market conditions.”

Ahmed Al Qassim, Group Head, Corporate and Institutional Banking at Emirates NBD, said: “We are delighted to have played a leading role in enabling ENBD REIT secure attractive terms for its debt. ENBD REIT has proactively taken advantage of current market conditions to optimise its profile. Our partnership on this transaction will equip them with a tailored facility that will allow them to meet their goals and deliver on their strategy. With the ongoing upturn in the real estate sector, the REIT is well placed to deliver long-term value to shareholders.”

As on 30 September ENBD REIT's Net Asset Value ("NAV") stood at stood at USD 164 million (USD 0.66 per share). The property portfolio value was valued at USD 346 million.

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