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Damac tightens yield on $750m sukuk

By Reuters
Pool, Water, Swimming Pool Damac
A view of Damac's Portofino community. The sukuk orders surpassed $2.3 billion

Dubai developer Damac Real Estate Development has sold $750 million in 3-1/2-year Islamic bond (sukuk), according to a document seen by Reuters on Wednesday.

The yield was set at 7 percent, narrower than the 7.5 percent initial price guidance released earlier in the day after the orders surpassed $2.3 billion, the lead bank document showed.

Emirates NBD Capital, HSBC and JP Morgan are joint global coordinators for the debt issuance deal, while Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank, Goldman Sachs International, Mashreq and Warba Bank are acting as joint bookrunners, the document said.

Sukuk are sharia-compliant bonds that were developed as an alternative to conventional bonds, which are not considered permissible by many Muslims as they pay interest and may finance businesses involved in activities not allowed under Islamic law.

In January Damac partnered with Hong Kong-based blockchain platform Mantra to tokenise assets worth at least $1 billion.

Dubai’s real estate market recorded AED634 billion ($172 billion) in transactions last year, with the government aiming to reach AED1 trillion annually in the near future. 

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