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Sobha Realty’s sukuk issuance hits $500m

This latest tap is an extension of the developer’s inaugural sukuk issuance of $300 million

Sobha Realty, a leading luxury real estate developer, has announced the execution of a strategic tap into its existing sukuk.

This latest tap is an extension of the developer’s inaugural sukuk issuance of $300 million, which took place in July 2023 and currently has an outstanding balance of $270 million. This 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 now reaches a benchmark size of $500 million. The tap adheres to the existing sukuk terms, preserving the favorable conditions and ensuring continued stability for the company’s valued investors, the developer said in a statement.

“The significant interest in Sobha Realty’s sukuk led to a notable price tightening of 95 basis points, highlighting strong demand from both regional and international investors. Approximately 25 per cent of the interest comes from global sources, reflecting strong confidence in Sobha Realty’s financial instruments,” it said.

Sobha Realty appointed 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. “Their expertise and commitment have been instrumental to its success.”

Sobha’s announcement follows recent upgrades from leading credit rating agencies. “These upgrades reflect our strong financial results, including substantial Ebitda growth, a larger revenue backlog, and improved Ebitda margins. Sobha Realty is confident this strategic move will further fortify its financial position and reinforce trust with its stakeholders,” said the statement.