Arada, the Sharjah-based real estate developer, secured Dh1 billion of loan financing to help fund the construction of its Aljada mixed-use mega-project and another scheme, Nasma Residences, it said on Wednesday.
The bank financing takes the form of two sharia-compliant syndicated loans worth Dh600 million and Dh400m, respectively, from Dubai’s Al Mashreq Bank. The agreement follows a previous Dh1bn facility arranged in December 2017.
Arada is a joint venture between KBW Investments – a firm controlled by Saudi Arabia’s Prince Khaled bin Alwaleed bin Talal – and Sharjah-based Basma Group.
“These facilities will enable us to continue our excellent progress at Aljada and complete all construction at Nasma Residences, where we are preparing to hand over our first homes,” said Sheikh Sultan bin Ahmed Al Qasimi, chairman of Arada.
“We see the successful closure of this transaction as a sign of confidence not just in Arada but in the entire Sharjah property market as well.”
UAE real estate prices have declined steadily since 2014 amid lower oil prices and muted demand, but developers have launched several tourism, housing and mixed-use projects in Sharjah in the past two years, as the emirate seeks to raise its profile and compete with its neighbour Dubai.
In addition, Sharjah’s government has introduced various initiatives to stimulate the real estate sector. These include allowing expats residing in the UAE to purchase property in Sharjah on a 100-year renewable land lease – “which will further drive investments into the local property market”, according to Ahmed Abdelaal, executive vice president and head of corporate and investment banking at Mashreq Bank.
Arada unveiled the 2.2 million square kilometre Aljada mixed-use community in 2017 as Sharjah’s largest-ever scheme to date with a projected sales value of Dh24bn. Arada is also building the 800-home Nasma Residences scheme in Sharjah, the first phase of which was initially targeted for completion last year.
Construction of Aljada has begun, with the first homes scheduled to be handed over by the end of this year. The first phase of the scheme’s Central Hub, a leisure facility designed by Zaha Hadid Architects, will be open in September. The scheme will comprise a mix of residential, commercial, retail, leisure and entertainment uses.
Nasma Residences launched in March 2017 and will comprise 900 homes, landscaped parks, a school run by the UAE’s Gems Education and two retail centres once complete. Construction of the first three phases of has begun, and the first units are due to be handed over in the coming days.
In total, Arada has sold more than 3,500 units across both projects in two years.
