Damac Properties to discuss increasing stake in London's Nine Elms project

The possible deal will be reviewed at the company's board meeting on Wednesday

Dubai, United Arab Emirates - April 25, 2019: Damac building with branding. Thursday the 25th of April 2019. Business Bay, Dubai. Chris Whiteoak / The National

Damac Properties, the UAE's third-biggest property developer by market capitalisation, is looking to increase its shareholding in the Nine Elms project in London, the company said on Sunday.

The company will discuss the matter during a board meeting on Wednesday, it said in a statement to the Dubai Financial Market, where its shares trade. Damac Properties owns 20 per cent of the Nine Elms project, with the majority owned by Dico Group, a private company owned by Damac Properties' majority shareholder Hussein Sajwani.

"The company confirms that to date there are no other acquisition deals that have been submitted to the company’s board of directors for the purposes of consideration and discussion," the developer said.

Nine Elms is a 50-storey tower located in London's South Bank. It has 450 one, two and three-bedroom apartments for sale. About 60 per cent of the units have been sold and the project is due to be completed by the end of next year, a senior executive from the company told The National in October.

Damac is continuing to look at new opportunities in Europe as well as in the US and Canada, Niall McLoughlin, senior vice president at Damac Properties and Dico Group, said.

“We are always looking for opportunities and there are various ways we can finance any acquisition, through debt, a loan or equity," Mr McLoughlin said. "So we can look at that as and when an opportunity arises."

Damac, which owns and operates the Middle East’s only Donald Trump-branded golf club – the Trump International Golf Club in Dubai – swung to a loss in the third quarter of this year after declaring almost Dh580 million in writedowns amid the coronavirus pandemic.

The company reported a third-quarter loss of Dh544.6m, compared with a Dh51m profit in the same period in 2019, it said in November. Revenue increased by 43 per cent to Dh1.28bn.

Dubai's real estate market slowed after a drop in oil prices that began in 2014, in tandem with an oversupply in the market as projects are completed. JLL's third quarter UAE Real Estate Market report said about 26,000 new homes were scheduled for completion in the final quarter of this year.

The total stock at the end of the third quarter was 585,000 homes, the consultancy said.

Last week, Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and ruler of Dubai, issued a new law governing unfinished and cancelled property projects in the emirate.

Under the law, a special tribunal will be set up to oversee the liquidation of unfinished and cancelled projects as well as the settling of related claims, according to a statement from the Dubai Media Office.