Abu Dhabi, UAETuesday 15 October 2019

Aldar eyes acquisitions and developer partnerships outside the UAE

Developer is open to tie-ups with foreign partners in Mena and Asia to expand its footprint

Aldar Properties, Abu Dhabi’s biggest property developer, is looking to acquire assets and is open for sale and property development partnerships in Asia and the Middle East and North Africa, as it looks to expand its footprint beyond the emirate, a senior company official said.

“We are always opportunistic. [Growth] is either organic or through acquisitions, and it all depends on what’s accretive to us and our shareholders,” Maan Al Awlaqi, Aldar’s executive director of commercial told The National in an interview at Cityscape in Abu Dhabi. “It’s all about enhancing shareholder value.”

Last year Aldar acquired real estate assets of Abu Dhabi’s Tourism Development & Investment Company in a Dh3.7 billion deal, one of the largest property acquisitions in the country’s history. Aldar Investments, a unit of the developer, earlier this year said it is acquiring full ownership of Etihad Plaza and Etihad Airways Centre from the UAE’s national flag-carrier Etihad Airways in a transaction worth Dh1.2bn.

The investment vehicle, launched in September last year, is among the region's largest diversified real estate investment companies whose portfolio includes Dh20bn of revenue-generating assets.

“We are continuously scouring for deals,” Mr Al Awlaqi said, when asked if the company is currently evaluating any deals. “Our investment committee over the past few years is always overloaded with [potential] deals that we are looking at. That’s always been the case.”

Aldar, the top listed developer in the emirate, is also open to striking partnerships to sell properties or develop new projects outside the UAE. For sales partnerships, the company considers the GCC a “key market” with Saudi Arabia “being the behemoth”. It is looking for partners for similar deals in Egypt, China, India and Russia, he noted.

Maan Al-Awlaqi, executive director, commercial, Aldar says the company is looking to expand its footprint beyond its home market. Courtesy Aldar 
Maan Al-Awlaqi, executive director, commercial, Aldar says the company is looking to expand its footprint beyond its home market. Courtesy Aldar

“In terms of [project] development partnerships, we are open to the world,” Mr Al Awlaqi said. “We have looked at different ways of going international. We are always looking for opportunities and look at how to do it and we are open to all different [types of partnership] structures.”

Aldar and Dubai-listed Emaar Properties, the UAE’s biggest developer by market capitalisation, in March last year formed a strategic alliance to develop Dh30bn worth of local and international projects. Under the agreement the developers will initially collaborate on two UAE-based projects: Saadiyat Grove in the cultural district of Abu Dhabi's Saadiyat Island, and the Emaar Beachfront project, a private island in Dubai located between Jumeirah Beach Residence and Palm Jumeirah.

The quality of the partners, he said, will dictate which of the markets Aldar will expand to internationally.

“We are looking literally everywhere … again it depends on the partner,” he said. “Saudi is definitely a primary sales market and given they are our neighbours that is something we look at.”

The developer, which has about 12 projects in the UAE at various stages of development, is seeing demand returning and the real estate market in the emirate bottoming out after softening in recent quarters on the back of slower economic momentum amid weak oil prices, which fell below $30 a barrel in the first quarter of 2016.

The price of crude has since stabalised, hovering around $70 per barrel, and the government has launched initiatives such as a Dh50bn three-year economic stimulus package known as Ghadan 21 while easing visa restriction to boost growth.

“We are seeing [bottoming out] happening on the ground,” he said. “We are seeing huge turnout [of investors] and huge demand. The bottoming formation is there in Abu Dhabi in terms of off-plan sales.”

Control of oversupply of real estate units in Abu Dhabi, he noted, has helped the market stabalise.

The market "is GRE [government-related entity]-dominated, with Aldar being a major player in that. We have been very shrewd in how we controlled the market over the past few years, especially with the oil price fall, and kept prices much more stabalised,” he added.

Updated: April 17, 2019 10:02 AM