Developer Arada has successfully closed a US $100mn tap of its existing $350mn sukuk, which was issued in June and listed on the London Stock Exchange.
In a statement, Arada said that the tap was priced at 99 cents on the dollar, with an investor yield of 8.386%. Arada’s existing five-year fixed rate RegS debut Sukuk issuance was rated BB- by Fitch and B1 by Moody’s, it added.
Ahmed Alkhoshaibi, Group CEO of Arada, said, “Arada continues to expand at an extremely rapid pace. To maintain that aggressive growth strategy, we took the decision to tap the markets opportunistically to secure the capital that will guarantee our plans remain on track. This exceptional response and over-subscription from the international debt capital markets is a further sign of faith in Arada’s impressive growth trajectory, fundamentals and future prospects. We’re especially pleased to have closed this issuance during an uncertain time for global markets, which is again a hugely positive endorsement of our investor proposition, good governance record and credit strength.”
In June 2022, Arada awarded a $20.4mn contract to build Sharjah’s largest and most technologically advanced fitness centre and, in October 2022, the developer launched the Masaar Discovery Centre.
He added that the tap witnessed resilient demand from the global finance markets, with a lead order of $185mn. The proceeds from the tap will be used for general corporate purposes and to support the development of Arada’s existing projects.
The Joint Lead Managers and Bookrunners for the tap were Standard Chartered Bank and Emirates NBD Capital, HSBC, Abu Dhabi Commercial Bank, Mashreq, Sharjah Islamic Bank, Kamco Invest, and Warba Bank. In May, Moody’s and Fitch assigned Arada first-time credit ratings, of B1 and B+ respectively, both with a stable outlook.
Since its launch in 2017, Arada has launched three master-planned projects in Sharjah, with a combined sales value of $9.12bn, which are said to be setting a new standard for integrated community living in the emirate.
In October 2022, Arada awarded $124mn in contracts to Airolink for the development of Aljada homes.
In January this year, Arada announced the purchase of a plot of land on Dubai’s The Palm Jumeirah luxury megaproject, in line with the company’s stated intention to diversify into new markets.
The developer said it is on track for a year-on-year 25% increase in the value of property sold in 2022, and is also aiming to complete 4,000 homes during the course of the year. In total, Arada has sold nearly 11,000 units since inception, valued at over $2.17bn. The developer has completed 2,600 units, with another 27,500 homes in the pipeline, it concluded.