DFM to see listing of two Reits this year
PLAYS PART TO PUSH FOR ALTERNATIVE FINANCING FOR PROPERTY
Dubai Financial Market plans to list two Real Estate Investment Trust (Reit) later this year, playing its part to push for alternative financing methods in the proposed Mortgage Law under the stimulus package, that intends to create greater depth in the property marketplace.
“We are introducing Reits this year, we are in final stages,” said Hassan Al Serkal, operation director at Dubai Financial Market, on the sidelines of the annual conference of the Securities and Commodities Authority (SCA) yesterday. “We have interest from a couple of companies, but we are putting the infrastructure in terms of laws, systems, so it is almost ready.”
Dubai Investments is awaiting final regulatory approvals before listing its Dh3 billion Reit, with a mix of Dubai Investments (DI) owned properties and those belonging to third-parties. The Reit would eventually grow to hold assets of Dh10 billion, according to Khalid Kalban, Managing Director and CEO of DI.
In other company listings, a couple are in the pipeline. “There are a couple of companies, which wants to list, but they are waiting because of the circumstances. They want to come [but] they are pausing because they want to wait for the right time,” Al Serkal said.
Low traded value
Al Serkal also said the current market sentiment was responsible for lower trading value on the bourse. “To attract any investor, there are a couple of things that you need to do. You have to have a transparent, secured system. You need to have good compliance.”
We are doing our best to put this infrastructure. It is there. It may be the situation around us (that is resulting in lower traded value),” Al Serkal said.
Traded value has taken a hit after having tumbled to a low of less than Dh100 million compared to Dh1 billion in 2016. Among other plans, the bourse is also planning to list single stock futures by the end of the year.
“We are introducing derivatives, our infrastructure is ready except for one part. We want to finalise and let’s hope this year we will announce it,” he said.
“We hope the market to get much better and hope to get more liquidity. We are doing the infrastructure. The new structure is helping the market for a potential upgrade by the MSCI to developed market category,” Al Serkal said, adding “we are upgrading our infrastructure in terms of security, trading systems, and clearing and depository system.”
About 35 companies listed on the Dubai Financial Market distributed cash dividend of Dh16.14 billion in 2017, up 29 per cent on year. These companies paid a dividend of Dh12.5 billion in 2016.