Emaar Properties to get the facility of Dh3.6b through Islamic finance
20 Dec 2011 04:43 GMT
Emaar properties are the benchmark for the real estates in Dubai. The company announced a decline of the net profit in October. That decrease was about 600 million Dh in 2010 and around 406 million Dh in 2011. The company showed the details of financial crisis on its official website. Then the company signed a new financial document with the Islamic banks to stop the continuous cut in the profit.

Emaar properties grew with the time as there are more and more shopping malls, hotels, leisure clubs, retail subsidizers and much other business are getting affiliated with the company. There is a continuous demand of more buildings from Emaar.  It is not just UAE that has the assets of the company. There are enough assets of Emaar in Jordan, Turkey and Syria. The main assets and resources of Emaar Estates are in Dubai Downtown where the company is making maximum out of it as Dubai is a place where people believe in spending more. These assets have always been growing.

Fifty percent of the total money borrowed has to be instantly repaid after a period of five years and the remaining about is payable within eight years. The pricing option is taken as the standard and the company has secured total 350 of foundation points and all these are protected by the Mall of Dubai alone. The chairman of the Emaar Properties, Muhammad Al-Abbar has commented on the decision, “it was a challenge for Emaar to get its financial issues solved in a difficult financial time. To strengthen the structure and the assets of all the futurist companies, it is important to find new opportunity and don’t let the conventional financial solutions ruin the whole business and get into prevailing financial system. Emaar is the first company that has managed to develop a framework with 8-years secured financing. There is much room for other businesses too to flourish in the new land of opportunities__ Islamic finance.”

There is a problem with the Emaar Properties that it is making less profit than the borrowed money which has been questioned repeatedly. The facility of dual maturity in Islamic finance will make the Emaar estates able to solve the problem and there are chances of getting a boost for the estates company. The company made a jump rise of around 500 million US dollar this year. The raise was due to a sukuk bond that has the maturity period of five and a half year and it gives around 8.5% which is above the average.

There is a great appreciation from the analysts as the company has done its best and experts are admiring the way Emaar Properties has maintained its power play and managed to refinance in difficult times. The tremendously improved profile of the company after touching the debt market  has raised its rating rapidly and stake holders are looking forward for more upgrading due to a witty decision that can get the company unbelievable profit even in the difficult times. 

-- Al Arabiya Digital

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