Thursday, Jul 9, 2020
International Finance
Real Estate

Dubai’s Manrre REIT to expand despite slump in property prices

Manrre real estate fund
The fund also plans lists its share on the stock exchange within the next few years

Dubai-based real estate fund, the Manrre Real Estate Fund (Manrre REIT) is planning to double its size even though property prices in Dubai have fallen by more than nine percent over the past year, according to local media reports.

Interestingly, the fund reported a 12.5 percent annualised return for 2018 which includes an 11.9 percent coupon paid to shareholders and a 0.6 percent increase in net asset value per share.

Reportedly, Manrre Real Estate Fund is also planning to make its debut on the stock exchange within the next few years.

The fund, which is managed by Dalma Capital, handles a portfolio of Dh265 million. According to Meher Anand, Director at the Manrre Real Estate Fund, it aims to become a Dh500 million fund in the next three years.

He also pointed out that the fund’s success is based on its selective and opportunistic process of acquiring assets. It only acquires assets that yield an 11 to 12 percent return and focuses on the logistics and industrial real estate.

The fund has capitalised from the growing demand for warehouses and logistics facilities in the e-commerce and industrial real estate sector.

Zachary Cefaratti, CEO of Dalma Capital said in a press statement, “The logistics and industrial real estate sectors are benefiting from the regional e-commerce boom underpinned by the launch of Noon and As we have seen in other markets, when retail spending behavior shifts to online shopping, real estate demand shifts from retail centres to warehouses.”

The fund’s acquisition of Arabtec’s staff accommodation facility in Dubai Investments Park has also contributed to the fund’s success.

As of 2018, 62 percent of the fund’s portfolio consists of logistics assets, 23 percent industrial, 8 percent offices, and 7 percent are staff accommodation.

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