Sobha Realty, a prominent luxury real estate developer, has recently announced a strategic move to tap into its existing sukuk. This tap is an expansion of the developer’s initial sukuk issuance of $300 million, which occurred in July 2023 and currently holds an outstanding balance of $270 million. The sukuk was listed on both the London Stock Exchange (LSE) and NASDAQ Dubai. With the completion of this tap, Sobha Realty’s total sukuk issuance has now reached $500 million, adhering to the existing sukuk terms to maintain favorable conditions and stability for the company’s investors.
The execution of this tap has garnered significant interest in Sobha Realty’s sukuk, resulting in a notable price tightening of 95 basis points. This indicates strong demand from both regional and international investors, with approximately 25% of the interest coming from global sources. The developer stated that this showcases strong confidence in Sobha Realty’s financial instruments. Sobha Realty has appointed leading financial institutions such as Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank, Emirates NBD Capital, Sharjah Islamic Bank, and Standard Chartered Bank as joint global coordinators, joint lead managers, and bookrunners for this transaction, highlighting their expertise and commitment to the success of the tap.
Recent upgrades from prominent credit rating agencies have further bolstered Sobha Realty’s position in the market. These upgrades, which reflect the developer’s strong financial results, including substantial Ebitda growth, a larger revenue backlog, and improved Ebitda margins, have instilled confidence in Sobha Realty’s strategic move and its ability to fortify its financial position and reinforce trust with stakeholders. Sobha Realty is committed to continuing its growth and development in the luxury real estate sector.
Sobha Realty’s successful tap into its existing sukuk demonstrates the developer’s ability to attract both regional and international investors with its strong financial performance and favorable conditions. The significant interest and demand in its sukuk highlight the confidence that investors have in Sobha Realty’s financial instruments, leading to price tightening and benchmark size issuance of $500 million. The developer’s partnership with leading financial institutions further strengthens its position in the market and ensures the success of the transaction.
Moving forward, Sobha Realty remains focused on maintaining its strong financial performance and growth trajectory in the luxury real estate market. The recent upgrades from credit rating agencies and the successful execution of the sukuk tap reflect the developer’s commitment to transparency, financial stability, and trust with its stakeholders. With a solid foundation and strategic moves in place, Sobha Realty is poised to continue its expansion and establish itself as a key player in the luxury real estate sector, both regionally and internationally.
In conclusion, Sobha Realty’s latest move to tap into its existing sukuk reflects the developer’s commitment to growth, financial stability, and investor confidence. The successful execution of the tap, along with recent upgrades from credit rating agencies, highlights Sobha Realty’s strong position in the market and its ability to attract a wide range of investors. With a focus on transparency, financial performance, and stakeholder trust, Sobha Realty is well-positioned to continue its growth and expansion in the luxury real estate sector.
