MANAMA, 13 April 2008 — Shamil Bank, a leading Bahrain-based Islamic commercial and investment bank and a wholly-owned subsidiary of Ithmaar Bank, yesterday announced that it has successfully met the $90 million target for the Shamil Bosphorus Modaraba, a Shariah compliant Modaraba. The Modaraba will invest in the lucrative Turkish real estate market. A 60 percent projected return on investment is expected over the three-year investment term of the Modaraba.
There was a strong interest in the Modaraba from regional institutional investors looking for access to this high growth sector in Turkey. The Modaraba’s focus is on residential and mixed-use real estate developments in Istanbul, and secondary homes on the Turkish coast. These include residential projects in Istanbul, including luxury villas overlooking the Bosphorus, middle income apartments and holiday homes on the sea coast of Antalya, in southern Turkey. The total cost of the projects targeted is approximately $450 million.
Shamil Bank subscribed to 10 percent of the $90 million commitment as a vote of confidence in the Modaraba.
“The Turkish real estate market is very attractive, given the substantial economic growth that the country has experienced in recent years. This Modaraba was launched following a careful year-long study conducted by real estate specialists, law firms and tax consultants appointed by Shamil Bank to measure both the potential upsides and risks,” said Investment and Private Banking Head Abdul Hakim Al-Mutawa.
“This Modaraba, which gives investors exposure to the burgeoning real estate market in Turkey, fits well into the portfolios of many of our clients, attracting stronger than expected interest from institutional investors from around the Gulf. Shamil Bank prides itself in being able to bring to the market innovative niche investment opportunities that are in line with the ethical principles derived from the Shariah. This Modaraba, benefits from both Shamil’s considerable management expertise, as well as the local knowledge of our real estate partners in Turkey,” he added.
