Shareholders of Union Properties, the Dubai real estate developer restructuring to narrow losses incurred during the oil-price slump, approved plans to buy-back up to 10 per cent of its shares for the purpose of reselling it, the company said in a bourse filing on Sunday.
The buy-back is intended to help the company shore up its finances as it continues to reorganise its business.
The company’s third-quarter net loss widened to Dh61.8 million, from a Dh44.1m loss recorded in the year-earlier period, as direct costs, administrative and finance charges rose, it said in a bourse filing in November.
Union Properties, which restructured its board last year, has struggled to maintain profitability in the wake of a softening real estate market in the UAE. Lower oil prices since 2014 has led to a fight for affordability among property tenants and buyers, pushing down rents and sales prices and squeezing developers’ margins.
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The stock has declined 58 per cent in the past 52 weeks, according to Bloomberg.
Union Properties has already approved plans to issue up to Dh1 billion in sukuk and increase the company’s foreign ownership limit as part of the restructure plans. The developer in May said it will privately place the Islamic bond to one or more qualified investors.
Union is building the Index Tower, UP Tower and Motor City developments, among others in Dubai. It has said this year it is looking to diversify income streams, expand its footprint outside its home market and launch new business lines to boost revenues.
