Barwa to Sell $4.4 Billion of Assets to Reduce Liabilities
Barwa Real Estate Co. (BRES), Qatar’s second-largest property developer by market value, is seeking to sell assets valued at 16 billion riyals ($4.4 billion) in Qatar and Egypt to reduce debt.
Assets being sold include Barwa Al Khor land in Qatar and the Barwa New Cairo project in Egypt, the Doha-based company said today in a statement. The sales price will be set according to book value and won’t involve any profit or loss, the company said. The developer is seeking to cut the 50.5 billion riyals of liabilities it had at the end of the second quarter.
Qatari real estate is recovering from excessive residential and office construction before the global financial crisis four years ago. Average rental rates for apartments and villas were unchanged in Doha during the first quarter, even as the leasing market “picked up significantly,” according to an April report by Asteco, a real estate services company.
Barwa, in which government-controlled Qatari Diar Real Estate Investment Co. owns the biggest stake, is developing properties in countries such as Egypt, the U.K. and Russia, according to its website. The company had a 21 percent decline in first-half profit as net income dropped to 593.6 million riyals from 752.5 million riyals a year earlier, the company said in a statement in August.
Barwa’s stock climbed 1.2 percent to 29.75 riyals today on the Qatar Exchange as of 10:45 a.m. The shares are up 3.1 percent in the past year, beating the country’s QE Index, which rose 2.8 percent during the same period.
Results of the sale will be reflected in company’s fourth- quarter financial statements, Barwa said in the statement.
To contact the reporter on this story: Zainab Fattah in Dubai on email@example.com