Emirates REIT rental income up 22% in the first half

Above, the Loft Offices in Dubai Media City, where Emirates REIT leases office spaces. (Courtesy Emirates REIT)
Updated 23 August 2017
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Emirates REIT rental income up 22% in the first half

DUBAI: Emirates REIT, the UAE’s first listed real estate investment trust, on Wednesday said its rental income grew 22 percent in the first half, boosted by rental payments from schools during the period.
The company’s unaudited financials results showed that rental income was at $25.4 million (SR95.25 million) from $20.9 million a year ago while service fees and other income rose 6 percent to $2.8 million.
“This primarily reflects incremental leasing of office units at Index Tower, income from Jebel Ali School and rental payments from British Columbia Canadian School,” Emirates REIT said in its statement.
“Total occupancy across the portfolio reached 83 percent as at June 302017. The weighted average unexpired lease term was up to 8.2 years from 6.2 years in the first half of 2016.”
The annualized rental income also continued to grow and passed the Dh200-million mark as of August, Emirates REIT said.
Emirates REIT’s net profit was however 23.1 percent lower at $18.3 million for the first half versus the year-ago $23.8 million, which it pinned on “decrease in revaluation gains year on year.”
“The first half of the year was marked by strong operating cash flow conversion to profits and demonstrates the efficiency of our property and tenant management. Our defensive portfolio of prime assets and the doubling of our team has helped us continue to grow rents and identify strong acquisition opportunities,” said Sylvain Vieujot, the chief executive of Equitativa Dubai.
The company said its aggregate portfolio valuation rose 6.9 percent to $772.1 million in the first half compared with $722 million during the same period of 2016.
Also on Wednesday, the company announced that has acquired the three-story European Business Center at the Dubai Investments Park for Dh130 million.
The commercial building will be Emirates REIT’s tenth property in its portfolio across Dubai.
“Emirates REIT expects the transaction to generate an estimated IRR in excess of 10 percent,” the company said, noting the building’s current occupancy rate of 87 percent with tenants including Stantec International, UBC Businessmen Service and the German Emirati Business Center.


Audi CEO detained in diesel emissions case

Updated 14 min 26 sec ago
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Audi CEO detained in diesel emissions case

BERLIN: German authorities on Monday detained the chief executive of Volkswagen’s Audi division, Rupert Stadler, as part of a probe into manipulation of emissions controls.
The move follows a search last week of Stadler’s private residence, ordered by Munich prosecutors investigating the manager on suspicion of fraud and indirect improprieties with documents.
“Audi CEO Rupert Stadler was provisionally arrested this morning,” the company said in a statement. It said shortly afterward that a judge had ordered him kept in custody pending possible charges at prosecutors’ request.
The company said that it couldn’t comment further due to the ongoing investigation, but stressed that “the presumption of innocence remains in place for Mr. Stadler.”
German news agency dpa reported that prosecutors decided to seek Stadler’s arrest due to fears he might try to evade justice. A former head of Audi’s engine development unit is already in investigative detention.
A total of 20 people are under suspicion in the Audi probe, which focuses on cars sold in Europe that were believed to be equipped with software which turned emissions controls off during regular driving.
Volkswagen has pleaded guilty to criminal charges in the United States and nine managers, including former CEO Martin Winterkorn, were charged there. Two are serving prison terms; Winterkorn and the others remained in Germany and are unlikely to be extradited.
Audi said in a statement last week that it was “cooperating with the authorities” in the probe.
Volkswagen shares were down 2.1 percent at 157.66 euros in Frankfurt trading.