Aldar Properties, an Abu Dhabi based property development, investment and management company, has acquired Daman House, a commercial office building in Capital Centre, Abu Dhabi. Daman House comprises 23,000m2 GLA of grade-A commercial space, fully leased on a long-term contract to a single government related entity.
The transaction underscores Aldar’s ambition to grow its recurring revenue portfolio through investment in new and existing revenue producing assets. The purchase of Daman House is the first to be made as part of a AED3BN investment programme that Aldar is implementing to drive growth within its recurring revenue business to achieve its new target of AED2.2bn Net Operating Income (NOI) by 2020.
The company has already committed approximately AED900m of investment, representing almost 30% of this programme, through the Daman House transaction, the forthcoming extension of Al Jimi Mall in Al Ain and the expansion within Aldar Acadamies through the construction of the Al Mamoura School in Abu Dhabi, announced in November 2015.
The AED410m extension of Al Jimi Mall will bring an additional 33,000m2 GLA of retail space to the existing 43,000m2 GLA trading space as well as a renovation and face lift of the existing mall. Al Jimi Mall remains a key retail asset in Al Ain, with footfall of 8 million visitors a year and this investment will bring new retailers to Al Ain as well as enhancing the overall shopping experience. Ground breaking of the new extension is expected to take place in January 2016.
The Al Mamoura school will be a co-educational primary school and a girls only secondary school. A total of 160 million dirhams will be spent on its construction, which is expected to be completed in 2016. The school is being built in response to continued strong demand for high quality education in Abu Dhabi and will become the seventh school in Aldar’s portfolio.
The investment into these three assets, all of which is being funded out of existing cash resources, will contribute approximately AED90m NOI once the assets are fully stabilised, with Daman House making an immediate contribution to NOI growth.
Mohamed Al Mubarak, chief executive officer at Aldar Properties, commented: “The acquisition … fits perfectly with our strategy of increasing our recurring revenue base and demonstrates our ability to take advantage of value accretive opportunities when they arise.
“The acquisition underscores our ability to successfully execute against our strategy to grow recurring revenues. I firmly believe that our sound financial position, strong capital structure and proven asset management capabilities will allow us meet our NOI target of AED2.2bn in NOI by 2020.”