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First in a series of announcement for TNI’s real estate division Abu Dhabi, May 29, 2005: In a move that strengthens the company’s real estate division’s fast growing reputation, The National Investor (TNI), the leading UAE investment and merchant banking firm, today announced the launch of its new USD100 million TNI real estate active fund (REAF) for the Middle East and North Africa region (TNI MENA Real Estate Active Fund).
Open primarily to UAE and GCC based institutional and individual investors, REAF will utilize TNI’s securities expertise and direct real estate experience. The open ended Fund comprises the following portfolio – around 70% to focus on real estate companies with a minimum market capitalisation of USD100 million; up to 25% on real estate IPOs that are taking place in the next 12 months and up to 15% of its assets in debt instruments of MENA real estate companies or cash management products.
Initial investment will target the UAE, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia and Tunisia. The minimum investment for institutions is 150,000 units with additional increments of 15,000 units while individual investors must apply for 25,000 units with increments of 2,500 units. The initial offering price is USD10 per unit.
Commenting on the decision to focus on the MENA region, Mr. Emile Habib, Managing Director, Heal of Real Estate Division, The National Investor, said: “The value of the region’s GDP is approximately US$2 trillion or 4.3% of global GDP and growing. Its positive economic fundamentals are supported by higher oil revenues, expansionary fiscal policies, acceptable interest rates and improving public governance. This is providing strong benefits by encouraging economic growth, trade, investment and job creation in the region in many sectors, predominantly in real estate. ‘
According to Mr. Habib, this is leading to huge growth for the real estate industry as it becomes the main driver of the region’s economies. “Liquidity is probably at a near and all time high in the real estate market, and capital still flows in from individual and institutional investors, domestic and foreign”.
New laws are being issued that allow MENA nationals the right to trade property to other MENA nationals and expatriates. We believe that these new ‘Free Hold’ laws will certainly have a positive impact on real estate industry and an enormous flow in real estate development projects. “In addition, REAF provides investors with risk adjusted returns while providing stability for an investor’s portfolio, geographic diversification, liquidity of investments and transparency through monthly and quarterly updates. The Fund will give investors the diversification they need and expose them to our experienced managers who have helped to create a distinguished track record in real estate activities for TNI,” Mr. Habib added.
As Fund Managers, TNI has designed the Fund to concentrate on companies that are ‘principally engaged’ in the real estate industry and are listed on local or national securities markets across the MENA region – companies should derive at least 50% of their revenues or profits from the ownership, leasing, management, development, financing or sale of residential, commercial, hospitality or industrial real estate or, (ii) have at least 50% of the value of their assets invested in residential, commercial hospitality or industrial real estate.
Since its launch in 2005, TNI’s real estate division has already secured a number of prestigious real estate investment banking mandates. These include the presently launched Al Surouh AED2.5 billion IPO, the largest in the history of the country, and the recently completed ALDAR Properties AED1.5 billion IPO. Today, TNI is the only investment bank in the UAE with a fully dedicated real estate investment banking team engaged in both real estate investment banking and asset management activities. TNI MENA REAF is the first fund dedicated to real estate to be offered in the GCC. MENA REAF is the first in a series of announcements which are slated to be made by TNI’s real estate division.
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About the National Investor:
The National Investor is a leading UAE investment and advisory firm with a distinguished track record in investment banking, private equity, real estate and asset management. The Company is backed by over 80 UAE shareholders who come from the highest echelons of the business and political community. TNI is actively involved in investment banking, private equity, and asset management and is currently ranked as the leading arranger of public share offerings, having lead managed the largest number of public offerings in the UAE to date. For more information, please visit www.nationalinvestor.ae.