Dubai Holding Announces Initial Public Offering For Dubai Residential REIT On Dubai Financial Market

Dubai Holding has announced plans to launch an initial public offering (IPO) for Dubai Residential REIT, aiming to list its units on the Dubai Financial Market (DFM). This move marks the GCC's first listed residential leasing-focused REIT. At listing, it is expected to be the largest in the region, boasting a gross asset value of AED21.63 billion, nearly double that of the five largest regional REITs combined.

The IPO will see DHAM Investments LLC, a subsidiary of Dubai Holding and the sole unitholder, offering 1,625,000,000 units. This represents 12.5% of Dubai Residential REIT’s issued unit capital. The First Tranche will consist of 162,500,000 units or 10% of the offer units. Meanwhile, the Second Tranche will include 1,462,500,000 units or 90% of the offer units.

The subscription period for this offering is scheduled from 13th May 2025 to 20th May 2025. Trading on DFM is anticipated around 28th May 2025. Both Dubai Residential REIT's Shariah Supervision Committee and Emirates NBD Bank's Internal Shariah Supervision Committee have confirmed that both the REIT and its offering comply with Shariah principles.

Dubai Residential REIT plans to distribute dividends semi-annually in April and September each year starting September 2025. The first two payments are expected to exceed either AED1,100 million or an amount equal to 80% of profit before changes in property value for each accounting period, pending Board approval.

The fund's portfolio includes over 35,700 residential units across 21 communities in Dubai. It comprises mainly apartments (95%) and some villas (5%). Last year saw an average occupancy rate exceeding 96.8%, with tenant retention at 87%. This reflects strong demand and satisfaction among residents.

Amit Kaushal, Group CEO of Dubai Holding, highlighted that integrating Nakheel and Meydan’s residential portfolios under Dubai Holding last year was a significant milestone. He noted that this IPO offers investors a chance to join this success story while leveraging broader opportunities within Dubai Holding.

Financial Performance and Future Plans

Malek Al Malek, Group CEO of Dubai Holding Asset Management and Chairman of DHAM REIT Management LLC's Investment Committee, reported revenues of AED1.8 billion in 2024 with an adjusted operating profit reaching AED1.3 billion. He emphasised that positive transformations in Dubai’s real estate market are driven by population growth and supportive government policies.

Al Malek also mentioned plans for organic growth through developing existing communities alongside acquiring new assets as part of expansion strategies. Evaluations for potential listings from other subsidiaries are ongoing; decisions depend on sector readiness without excluding future options.

Ahmed Al Suwaidi, Managing Director of DHAM REIT Management LLC, stated that investing in Dubai Residential REIT provides a unique opportunity for investors seeking high-quality income-generating properties across Dubai without direct ownership complexities.

With inputs from WAM