Equitativa, the largest REIT manager in the GCC, has announced that it has acquired three additional fully leased floors in Index Tower for its Emirates REIT portfolio, at a purchase price of AED 106.5 million.
Emirates REIT expects the transaction to generate an estimated Internal Rate of Return (IRR) of 12%, with an annual yield of 10% for the new floors. Following the acquisition, Emirates REIT's total portfolio will reach AED 3.5 billion, comprising of 11 properties across Dubai.
Post transaction, the occupancy rate of Index Tower offices will increase to 50%.
The newly acquired floors are leased with a Weighted Average Unexpired Lease Term (WAULT) of 3 years. This will enhance Emirates REIT’s multi-tenant diversification and stability model, which is mostly made up of Grade A office space, retail and educational property, with a current new total NLA of 2,401,804 square feet in the portfolio.
Emirates REIT, which is currently the world's largest Shari'a compliant Real Estate Investment Trust and listed on Nasdaq Dubai, previously owned 17.5 office floors and their associated car parking spaces in Index Tower. This latest acquisition of the full space on levels 26, 27 and 28 of the tower adds to Emirates REIT’S portfolio a Net Leasable Area (NLA) of 58,156 square feet of office space and 135 parking bays allocated to these floors. The transaction increases Emirates REIT’s NLA in Index Tower to 432,930 square feet.
Index Tower is an award winning, iconic 80-storey building, located in DIFC, at the heart of the Central Business District. It features residential, offices and retail components, of which Emirates REIT now owns 85% of the offices, over 1,561 car parking spaces and over 63,000 square feet of retail.
Sylvain Vieujot, Group Chairman of Equitativa, commented: "We are very pleased to have completed this acquisition. It complements our portfolio of grade A offices and delivers an attractive yield whilst increasing Emirates REIT's Funds From Operations (FFO).”
