Emaar Obtains $500 Million Financing Facility for Turkey Project
Emaar Properties PJSC (EMAAR), the developer of the world’s tallest tower in Dubai, obtained a $500 million loan from a group of banks to develop a mixed-use project in Turkey, its second such venture in the country.
Standard Chartered Plc (STAN), HSBC Holdings Plc (HSBA) and Emirates NBD Capital Ltd. are among lenders that will provide the seven-year loan, Dubai-based Emaar said in an e-mailed statement today. The money will be used to develop Emaar Square in Istanbul, which will include what would be Turkey’s largest shopping mall, luxury homes, a five-star hotel and offices, it said.
Emaar is focused on completing its projects in key emerging markets and in Dubai on schedule, Chairman Mohamed Alabbarsaid in the statement. “Turkey is one of our key markets, where we have successfully handed over homes in the first phase of our first integrated community, Tuscan Valley.”
Emaar, the United Arab Emirates’ biggest developer by market value, is expanding across the Middle East as an oversupply of properties in Dubai hurts the company’s home market. Emaar’s malls and hotels have helped cushion the effect of the region’s real estate crisis by providing stable revenue.
Last December, Emaar agreed to 3.6 billion dirhams ($980 million) in financing with three banks backed by its flagship Dubai Mall, half of which would be repaid in five years and the rest amortized over eight years. Emaar is paying interest of 3.5 percentage points over the benchmark rate on the loan.
Emaar raised $500 million in July from the sale of seven- year Islamic bonds at a profit rate of 6.4 percent, according to data compiled by Bloomberg. The bonds traded at a yield of 4.898 percent today, according to the data.
Emaar in October reported a 4.7 percent decline in third- quarter profit to 387 million dirhams ($105 million) as revenue fell. Its debt was 23 percent of its capital at the end of September, according to data compiled by Bloomberg.
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