Sale of Remraam Residential Towers
ENBD REIT announced the sale of its Remraam residential assets. The transaction was completed at a slight premium to the current market value on March 31, 2024. The sale amount remains undisclosed.
PC: Arabian Business
Strategic Alignment and Financial Impact
The offloading of the Remraam assets is part of a greater turnaround strategy by ENBD REIT toward portfolio optimization and enhanced growth of dividends by way of proactive asset management. Offering for sale the two residential towers, Al Ramth 57 and 59, is consistent with this. It constitutes a key milestone in the REIT’s strategy for streamlining the portfolio.
The proceeds of sale are going to be deployed in lowering ENBD REIT debt. By that action, the Loans-to-Value (LTV) ratio of the Company is going to decrease from 51 percent to 49.4 percent with this assets sale. This decrease will be an enhancement of EnBD’s financial position and make it possible to keep a track record of predictable and regular dividend payments to the shareholders.
Details of Sold Assets
The two residential towers that have been disposed of—Al Ramth 57 and 59—are situated in Dubailand and, between them, account for around 4 percent of the total portfolio value of ENBD REIT. Purchased in September 2015, the towers comprise a total of 105 units with a net leasable area of 112,154 square feet. The sale illustrates the strategic focus of ENBD REIT to optimise its asset mix and continue to elevate the quality of its overall portfolio.
Management’s Perspective
According to Samir Kazi, head of Real Estate at Emirates NBD Asset Management, who also serves as CEO of ENBD REIT, this is the value in the deal. He said, “Following a comprehensive review of the portfolio, we have identified a clear turnaround strategy to unlock value for our shareholders and maintain our position as a reliable dividend payer. This marks an important first step toward future-facing streamlining of our portfolio, improvement toward the overall mix of our portfolio, and debt reduction for underpinning our financial foundations.
Future Outlook and Strategy
As part of its turnaround journey, ENBD REIT continues to explore opportunities in terms of making strategic investments or rebalancing portfolios. Despite interest rate pressure and a fast-changing marketplace with increasing pricing expectations, the REIT remains focused on delivering value to investors. At the core of the strategy is proactive asset management and prudent financial practices that help navigate such market conditions and continue growth.
The approach of ENBD REIT reflects a broader trend in the real estate sector, with REITs focusing on portfolio optimization and debt management to enhance shareholder value and ensure financial stability within an increasingly competitive environment.
