Bloomberg/Christopher Pikeby Kudakwashe Muzoriwa
Emirates NBD Asset Management’s ENBD REIT has revealed plans to restructure its fund and to delist from the Nasdaq Dubai where its shares trade.
ENBD Reit stated that its board of directors has decided to proceed with formalising a restructuring and to become a privately held REIT, subject to shareholders’ and regulatory approvals.
The fund became only the second listed real estate investment trust in the UAE when it listed on the exchange in 2017, but the tough real estate market in Dubai, where its entire portfolio of assets is based, and a lack of liquidity in its stock has meant its share price has regularly traded below the value of its net assets.
Anthony Taylor, the Head of Real Estate for ENBD REIT, said, “With the share price representing a significant discount to (net asset value) and current market conditions expected to prevail, we have undertaken a comprehensive review of strategic alternatives to maximise long-term value for shareholders.”
The Shari’ah compliant real estate investment trust is also considering the deposit of ENBD REIT shares in Nasdaq Dubai CSD, facilitating share transfers upon becoming a privately held REIT.
Additionally, ENBD REIT said that it is in discussions with the Dubai Financial Services Authority as well as other stakeholders and further details will be submitted for shareholders’ approval in January 2020.
"We believe that the decision [to delist] is in the best interest of shareholders who stand to realise greater value from holding equity in the REIT—valued according to NAV—on a fixed-term basis,” said Taylor.
The firm’s portfolio includes The Edge office building in Dubai Media City, the Souq Extra community retail mall and Binghatti Terraces apartment complex at Dubai Silicon Oasis as well as the Uninest student property building at Dubai Academic City and South View School in Dubailand.