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Dubai ENBD REIT posts 8.8% decline in net asset value, lower rental income

November 25, 2021
real estate

Trust managed by Dubai's largest bank cites 'sustained pressures' on valuations, leasing yields

The value of total assets and real estate holdings of Dubai real estate investment trust ENBD REIT has declined on the back of sustained pressures on valuation and rental income, the company reported on Wednesday.

As of September 30, 2021, net asset value stood at $164 million, down by 8.8 percent from $180 million in March 31, 2021 due to “valuation pressures”, while the value of property portfolio dropped 3.8 percent to $346 million, reflecting the “prolonged soft real estate conditions” and decline in rental yields in the office sector.

The trust is managed by the asset management unit of Dubai’s largest bank Emirates NBD. Its portfolio is predominantly invested in the office market, which has softened since the onset of the coronavirus pandemic.

Loan-to-value ratio went up to 54 percent, which is also due to “downward pressure on valuations”, but overall occupancy across the portfolio remains stable at 76 percent compared to the levels seen in March 31, 2021.

“Our occupancy rate has remained stable during the first half of the year against a backdrop of sustained pressures on valuations and rental income,” said Anthony Taylor, Head of Real Estate at Emirates NBD Asset Management.

“We are investing in our office portfolio and successfully completed two refurbishments below budget during the period while we are also on track to finalise the upgrades at Al Thuraya Tower 1 which will support improved lettings.”

zawya

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