MANAMA, 18 February 2007 — International Investment Bank (IIB), a globally-focused investment bank based in Bahrain, has sold its 50 percent equity stake in One @ Business Bay commercial tower project in Dubai, a $94.1 million joint venture project with Omniyat Developments, part of the Al-Masa Group of Dubai.
At a press conference held in Dubai, IIB’s Chief Executive Officer Aabed Al-Zeera, said: “We are delighted that we have been able to achieve an excellent internal rate of return (IRR) of 25 percent per annum in this investment, together with an exit from this project only 11 months after the original investment was made.
Following the sale of all 30 floors in the tower within the first few months, our partners made an attractive offer for our equity stake, and we took the decision to exit so that we could provide our investors with an attractive early return on their investment, and redeploy our resources towards other investment opportunities. We had originally envisaged an investment holding period of 18 months, but following a very effective marketing campaign, pre-sales of the floors exceeded our original projections and generated significant surplus cash flow. The combination of IIB’s financial, structuring and placement capabilities with Omniyat’s marketing and development expertise proved to be an extremely successful formula, which we will seek to replicate on future projects with other partners.”
The commercial property market in Dubai has been strong over the past two years, with demand for prime office space outstripping supply. Under a Dubai Government master development plan, Business Bay is destined to become the new central business district in Dubai, eventually comprising some 250-300 towers for commercial, retail, residential and hotel use.