Kuwait-based Gulf Investment House (GIH) has reported the sale of the Summit at Carlsbad, located in southern California at a 30 percent gain. This makes Carlsbad the second sale in the Bunyan Fund, launched by GIH in 2001, to post double-digit gains, following Truman Park’s 90 percent gain at the end of last year.
The Bunyan Fund is the first Sharia compliant international real estate fund that has begun to realize and capture gains through the successful implementation of exit plans within the specified investment holding period.
The exit of Carlsbad was completed on February 19, 2004 through the sale of the underlying land in the project. A decision to sell the land rather than hold the project through completion was based on various market and investment related factors. In terms of the market, the barriers to entry for construction of multi-family apartments were exceptionally high in the city of Carlsbad. The value of permit-approved land increased significantly over the past two years, driving the land value of the Carlsbad project to attractive levels.
After holding the project for a year and a half, and attaining all required building permits, the fund sold the Carlsbad project, and associated land ownership rights, at a Fund-level, pre-tax IRR of 17.4 percent.
The Bunyan Fund is a closed-ended fund comprised of four construction projects of class A multi-family apartment located in key Metropolitan Statistical Areas. The Bunyan Fund’s portfolio of construction projects contains real estate assets valued at approximately $123 million covering 63 acres, comprising of 60 buildings, and representing 963 units. — (menareport.com)
© 2004 Mena Report (www.menareport.com)
