Aldar Properties, the biggest developer in Abu Dhabi by market value, has bought Rixos Bab Al Bahr hotel in Ras Al Khaimah in a Dh770 million ($210m) deal as it continues to expand its portfolio of hospitality and leisure investments in the UAE.
The acquisition of the 715-room hotel that opened its doors in 2014 was made by Aldar Investment — the company's second investment in the emirate this year, it said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.
“The acquisition adds further scale to Aldar Investment’s growing hospitality and leisure portfolio and will bring its total investment in Ras Al Khaimah to Dh1.5 billion, including the earlier acquisition of Al Hamra Mall and additional development rights at both properties,” the company said.
RAK Hospitality Holding, an integrated hospitality and leisure company that owns and operates hospitality and leisure assets, separately confirmed the sale of Rixos Bab Al Bahr to Aldar Investment through its subsidiary RAK National Hotels.
Last year, Aldar adopted a new group operating model and organised its business into two segments. Aldar Investment is responsible for managing its Dh22bn portfolio of recurring income assets, including its hospitality portfolio, while Aldar Development is responsible for building the company's 75 million square metre land bank.
“The acquisition is underpinned by the tremendous potential of the emirate as a tourist hub, our robust asset management capabilities, as well as the strong operating fundamentals and mature nature of the asset itself,” Jassem Busaibe, chief executive at Aldar Investment, said.
“In addition to the transaction being value and yield-accretive to our recurring-income generating portfolio, it allows us to build further scale and enhance diversification, which is a key tenet of our strategy going forward.”
As part of the deal, Aldar Investment has also secured development rights for an additional 250,000 square feet for residential and commercial use, it said, without giving details of further development plans.
“Aldar’s investment in the emirate contributes to enhancing the hospitality experiences for our tourists and residents, adding to the emirate’s destination appeal,” Alison Grinnell, chief executive of RAK Hospitality Holding, said in a separate statement.
In February, Aldar bought Al Hamra Mall in a $111.6m deal, its first transaction outside Abu Dhabi, and said it plans to further expand its footprint in Ras Al Khaimah.
The company, through its investment platform, is assessing opportunities to invest more capital into new geographies and property types as part of an overarching growth strategy, the company said at the time.
The Abu Dhabi-based company is also increasing investments outside the country. Last year, a consortium of Aldar Properties and one of the region’s biggest holding companies, ADQ, acquired a majority stake in Egypt’s Sixth of October for Development and Investment Company for 6.1bn Egyptian pounds ($386.8m).
The value of mergers and acquisitions in the Mena region surged 57 per cent to reach $109.1bn last year. The total number of deals also jumped 40 per cent annually to reach 1,141, the highest annual total recorded since 1980, according to a report by Refinitiv.
Aldar reported a 21 per cent jump in its full-year 2021 profit to Dh2.3bn, as revenue rose 2 per cent annually to about Dh8.6bn on record property sales amid the continued recovery of the UAE’s property market.