Dubai Properties IPO

[sharewadi]

A Dubai Properties Initial Public Offering (IPO) is a go according to this report from Arabian Business. AB says Dubai Properties IPO is "confirmed", and the Deputy CEO said "yes" when asked if there would be a Dubai Properties IPO. But the only quote from Mr Al Zarooni I can see is that he says Dubai Properties has enough money, and they might IPO one of the units but not the whole company. So did he say there would be a Dubai Properties IPO or not ?

Dubai Properties has $272 billion worth of property projects planned for the next 5 years. That's 1 trillion dirhams. I think that dwarfs even Emaar Properties (EMAAR) or Aldar Properties (ALDAR) portfolio.

Arabian Business 06 September 2008:

Dubai firm's IPO plan to fund $272bn projects by Tom Arnold from Paris Dubai Properties has confirmed it intends to launch an IPO to raise part of the funding for the $272.2 billion of real estate projects it has planned in the next five years. But Yaqoob Al Zarooni, deputy chief executive of the master developer said the company had sufficient existing capital to fund the majority of the investment, as it seeks to double the $136 billion of assets it manages currently. Al Zarooni was speaking to Arabian Business at the Ritz Hotel in Paris as part of the world exclusive sales launch of Babil, a residential development within the new $13 billion Culture Village project in Dubai. Dubai Properties is on the second leg of its European sales promotion, with the developer expecting the first 51 properties in the project which have been advertised at London’s prestigious Harrods store since July to be snapped within the next 10 days. The remainder of the 159 units will then be sold in the UAE. Al Zarooni said the weakening of the UK economy was encouraging buyers to invest in property in the emirate. “This is a great opportunity for people in Europe to have the first access to this development before the Dubai market,” he said. “If we launched the sale of these properties in Dubai they would be sold out within days but like any company we like to diversify.” Culture Village was the idea of Dubai ruler and Vice President and Prime Minister of UAE, Sheikh Mohammad bin Rashid Al Maktoum, who wants the scheme to celebrate the cultural heritage of the emirate. Covering over 40 million square feet in the historic district of Jadaf, Culture Village will comprise residential, commercial and retail zones including a Palazzo Versace hotel and resort, an amphitheatre for live performances, museums and galleries displaying local and international art, as well as a shipyard for traditional dhow builders. Sheikh Mohammad had a direct input in the development, the first phase of which is expected to be complete by 2012, and requested its architecture be based on the design of buildings in the city up to 100 years ago. Within the project will be the Middle Eastern museum of Modern Art, a 25 square metre eye-catching building with galleries, art shops and auction and an exhibition hall showcasing the works of Arabian artists. Dubai Properties has also been marketing its $15 billion Mudon project, to be located in Dubailand, which will include five areas based on historic Baghdad, Beirut, Damascus, Cairo and Marrakesh within one large city housing 50,000 residents when it is finished in 2012. The state-owned company, a subsidiary of Dubai Holding, is managing assets of 500 billion dirhams currently, with it hoping this figure will double to one trillion dirhams in five years. When asked if the company would launch an IPO, Al Zarooni said yes. He said the developer may decide to list shares for one division of the six companies Dubai Properties is made up of to raise investment for its projects with the rest of the funding coming from existing capital. “Our company is big, we are managing a total asset of 500 billion dirhams, you cannot IPO a company of that size, so by splitting them into six we might then, for example, IPO the sales and marketing company or the facility management company,” he said. “We are self-sufficient right now, all the funds come from within as we have lots of money.”

_________________
UAE IPO list | posting guidelines

[sharewadi]

The Chairman of Dubai Properties Group (DPG) says there is no IPO in the pipeline. So who said what? As far as I can tell:

Dubai Properties Chairman: no IPO
Dubai Properties Deputy CEO: yes according to AB, but not really according to quoted statements.

Conclusion? Don't hold your breath...

Emirates Business 08 October 2008:

India stays on top of Dubai Properties expansion plans By Sona Nambiar Dubai Properties is looking at exploring the international markets by the end of this year and India is a strong contender on its list, said its CEO. "We have been working on this issue for the last two years and we believe that it is about time we look at going international. I am confident that by the end of this year, we will be in a position to announce something and we would like to do something in the Indian subcontinent. It is a strong possibility," said Mohamed Binbrek, Chairman of Dubai Properties Group. The group is also examining other possibilities, he said. "We have presence in the East European countries and we have recon missions of people looking at North Africa, but it is in the preliminary stages. Nothing concrete right at the moment," he said. He refuted rumours that Dubai Properties is planning an IPO in the future. "There is no IPO in DPG and any of its subsidiaries," he said. "We don't have to resort to any project financing either. We are a self-funded entity and do not have any need for project financing. We have also recently appointed a new CFO for the group." He disagreed that there is a liquidity crisis in the region. "We have compiled statistics on the end users who are buying from us. Only six per cent of these people are going for bank financing. The rest have been buying with their own money. Secondly, the Central Bank in the UAE has been rigid in terms of applying lending requirements across banks. Thirdly, the Central Bank figures show that the ratio of deposits is greater," said Binbrek. "We have this herd mentality though. I think these are peaks and troughs that Dubai has always overcome. In early 2002, the market had negative sentiments for a short time about commercial property but it started picking up after a while. I think the current situation is about sentiments, not fundamentals." According to him, the five-year plan at Dubai Properties looks bullish. "Our five year plan talks about the growth of the company by a multiple of 20 per cent per annum," he said. The MBR Gardens project is well on track he said. "This is a long-term project and we are in the phase of finalising the planning. Meanwhile, Phase 1 of Cultural Village will be ready in second quarter of 2010," he said. "We are almost 95 per cent complete in terms of infrastructure work." Project delays are a part of the ongoing challenges at DP too, he admitted. "These are ongoing challenges even now. We try to minimise the delays and communicate candidly with our investors and customers about it. Yes, there were problems that arose in the early days when the market was young," said Binbrek. "But today, if I say MBR Gardens will take 12 years, maybe I am managing my own expectations by allowing myself to overstate the deadline and deliver it ahead of time."

_________________
UAE IPO list | posting guidelines