The Sharia-compliant fund, which has yet to raise capital, will focus on investing in completed and near-finished properties.
Property fund may mark recovery start
Mayfair Wealth Management launched a US$50m (Dh183.6m) fund Tuesday that will invest in distressed property in Dubai and Abu Dhabi, a sign the property market may be levelling out. The Sharia-compliant fund, which has yet to raise capital, will focus on investing in completed and near-finished properties it sees as undervalued, said Amani Choudhry, the chief executive. "I feel in a couple of months the market will reach the bottom," she said. "We've been monitoring the market for undervalued properties for 10 months and we're ready to start investing."
The closed fund will last three years with annual dividends. Ms Choudhry said she was aiming for annual returns of between 12 and 15 per cent through resale of property and rent. The arrival of such funds marks a shift to recovery, said Matthew Green, the head of research at CB Richard Ellis. "These types of funds will be some of the first players to enter the market after a downturn and as such they have come to signify the first small steps towards recovery," Mr Green said.
But he said the most crucial part of the rebound would be the return of end users, or those who buy property to live in it. @Email:firstname.lastname@example.org