Dubai Holding Merges Property Portfolio

DUBAI — Dubai Holding said on Saturday it has merged property portfolio of its three subsidiaries ahead of a planned merger with Emaar Properties later 0this year.

By Abdul Basit

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Published: Sun 23 Aug 2009, 11:24 PM

Last updated: Fri 12 Jul 2024, 11:37 AM

The state-owned company has merged the project portfolio of Dubai Properties, Sama Dubai and Tatweer, creating one of the largest developers in the region, according to a statement issued by the company.

Dubai Holding said in February it would merge back-office operations at Dubai Properties, Sama Dubai and Mizin to cut costs. Three of Dubai Holding’s real estate units are in talks to merge with the emirate’s leading developer Emaar Properties.

The global credit crisis forced an end to emirate’s property sector boom, prompting developers to cancel scores of projects and leading to thousands of layoffs. The restructuring comes at a time when the Dubai is trying to reanimate its economy, as the global economic turmoil curtailed access to cheap finance while lower oil prices cut revenues.

Dubai Holding said that the first phase of the company’s realignment has been completed with the formation of two verticals, property and business parks. The verticals allow Dubai Holding to build on its core competencies in two major specialisations and effectively bring together complementary assets across the business, allowing access to greater benefits for customers, the company said.

The formation of these two verticals is the first step in executing the full realignment into four verticals, as announced last week, in order to streamline its operations and ensure the continued delivery of world-class projects and future growth of the organisation.

“The process of realignment has led to the development of Dubai Holding into a more efficient organisation, able to respond more effectively to the needs of its stakeholders,” Dubai Holding Chief Executive Officer Ahmad bin Byat said.

The property vertical integrates and leverages the strengths and portfolios of Dubai Properties Group with Sama Dubai, as well as Tatweer’s real estate development projects including Remraam, The Tiger Woods Dubai, Dubailand and Bawadi, to create one of the largest real estate and development based businesses in the region. Each business brings considerable and distinctive strength to the property vertical.

“The transition has been smooth and had minimum impact on our relationships with our partners and clients,” Byat said.

The Business Parks vertical integrates the existing operations of TECOM Investments with Dubai Healthcare City and Dubai Industrial City, thus expanding the focus of the development of innovation in information, communication, media and knowledge to also include healthcare and industrial development.

The Dubai government introduced a number of measures, including a $20 billion bond programme, whose proceeds are aimed at bolstering entities such as Dubai Holding.

Recently Moody’s downgraded its rating for Dubai Holding from A2 to A3 and also placed the company on review for a possible further downgrade citing ongoing concerns over the emirate’s proeprty sector. Standard & Poor’s also said rating for Dubai Holding remained on watch with negative implications.

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