Deyaar Development PJSC gained to the highest since 2008 on bets the Dubai-based developer will benefit from an improving economy and the United Arab Emirates’ upgrade to emerging-market status by MSCI Inc.
The shares advanced 12 percent to 1.61 dirhams at the close, the most since Sept. 1 and the strongest level since September 2008. The company said Feb. 13 it would allow foreign ownership for the first time. Volumes climbed to almost six times the three-month daily average today. The stock was the biggest mover and the most traded on the benchmark DFM General Index, which jumped 0.9 percent.
“The company is delivering projects, they have a strong balance sheet and there is interest from both retail and institutions,” Harshjit Oza, assistant director of research at Cairo-based Naeem Holding, said by phone. Deyaar’s decision to allow foreigners to own its shares has also “prompted investors to take exposure ahead of the MSCI upgrade,” he said.
Property is leading an economic revival in Dubai, with real estate prices predicted by the emirate’s Land Department to jump as much as 40 percent in 2014. Deyaar last month started marketing its $245 million Atria development in Dubai’s Business Bay. The project’s residential inventory sold out for 500 million dirhams ($136 million) within hours, the company said in a March 17 statement.
The developer, 41 percent owned by Dubai Islamic Bank PJSC, the U.A.E.’s largest lender, has surged more than 400 percent in the last 12 months.
The nation was raised to emerging-market status from frontier by index provider MSCI in 2013, potentially paving the way for greater foreign investment.