Dubai ruler’s firm refinances US$8.2 billion to tap property boom
DUBAI Holding refinanced a US$8.2 billion loan to replace older facilities at the two state-backed developers it absorbed last month, better positioning itself to capitalise on a boom in the city’s real estate market.
The funding will refinance debt held by the firms – Nakheel and Meydan – according to people familiar with the matter, who asked not to be identified because the information is private. The deal helped secure more favourable terms for the debt, with Emirates NBD Bank and Mashreqbank underwriting the loan, they said.
Nakheel is best known as the developer of Dubai’s artificial palm-shaped islands, while Meydan owns one of the world’s most opulent horse racecourses. The companies were merged and brought under Dubai Holding – an investment firm owned by the emirate’s ruler – to better take advantage of the strength in the real estate market.
The recent moves, orchestrated by Dubai Holding chief executive officer Amit Kaushal, could potentially be a precursor to an eventual listing of some of the conglomerate’s units over the next few years, according to two of the people. Kaushal, who took over as CEO in 2018 after stints at global banks including Goldman Sachs Group and UBS Group, is looking to cut costs at the combined entity and streamline operations, the people said.
A representative for Dubai Holding didn’t immediately respond to comment.
The deal in March created a real estate behemoth with a large land bank and assets worth billions of dollars – better equipped to cope with fluctuations in a property market known for its boom and bust cycles.