Taking a significant step forward in expediting the development of The Lagoon on Amwaj Islands off the coast of Muharraq in the Kingdom of Bahrain, Abu Dhabi Investment House P.J.S.C. (ADIH) today announced opening a US$41.5 million Sharia’a-compliant private placement to finance the commercial and retail project spread over 600,000 square feet.
The private placement has been floated to part-fund the development of The Lagoon, which will come up on the land the Abu Dhabi-based financial institution acquired recently from the Bahrain-based Ossis Property Developers, master developers of the US$1.5 billion Amwaj Islands.
Announcing the launch of the private placement, Mr. Rashad Janahi, Chief Executive Officer of ADIH said: “The private placement offer is yet another instance of ADIH’s desire to provide investment opportunities that are linked to prestigious infrastructure developments in the region. The investment offer is in line with our aim to offer investment instruments that are sophisticated and are correlated to the economic growth potential of the region.”
“The Lagoon is a unique and pioneering development, which for the first time allows Bahraini and international retail and commercial investors to own there own units on a lease-hold basis. We are confident that the placement offer linked to such a path-breaking ownership concept will be welcomed by investors with great enthusiasm,” he said.
The Lagoon will comprise eight low-rise buildings consisting of 50 retail units on a total built-up area of 88,679 square metres and a net-sellable built-up area of 38,456 square metres. The project is envisaged as a unique destination in the Kingdom of Bahrain housing shops, restaurants, cafes and various other retail outlets with a one-kilometre walk-way encircling the lagoon.
The project is scheduled for completion by September 2007. “The private placement is a prestigious opportunity for regional investors to partner in The Lagoon by collectively owning a stake of 97.6 per cent in a holding company set up exclusively to develop the project. In a span of over one year since our establishment, ADIH has been able provide its clients superior returns and The Lagoon private placement has targeted to achieve an IRR in excess of 20 per cent over a 16-month tenure,” Mr. Janahi said.
The minimum subscription in the placement is US$50,000 and any additional investments will be in multiples of US$50,000. The placement will offer investors 4,150,000 shares of US$10 each in the holding company for The Lagoon.
“We have conceived the investment instrument with strategic focus on the growing services sector in the economy of the Kingdom of Bahrain which has a contribution of over 19 per cent (2003) in the GDP. The share of this sector in the economy will significantly grow in the days to come with the various tourism-related infrastructural developments underway in the Kingdom,” Mr. Janahi added.
ADIH has a growing portfolio of investments in the region’s infrastructure and property development including Beirut Gate in Lebanon, which will be developed at an investment of US$600. ADIH also signed a US$1.2 billion MoU with Qatari Diar Real Estate Company for Lusail Entertainment District in Qatar.
ADIH was also involved in the private placement for the multi-billion dollar Energy City Qatar, closing a US$100 million offer successfully in the UAE market. It had also announced a Euro 144 million German property fund.
