Masdar Green REIT bolsters portfolio with AED934 million sustainable real estate acquisition

ABU DHABI, Masdar Green REIT, the UAE’s first Real Estate Investment Trust to invest solely in sustainable real estate assets, has concluded the acquisition of property worth AED934 million, taking its portfolio value to AED1.91 billion, with further assets identified for potential future investments.

The announcement, made by the fund’s manager Masdar Capital Management Limited (MCML) today at Abu Dhabi Finance Week, follows a US$200 million green loan secured from First Abu Dhabi Bank (FAB) in January to help finance the REIT’s growth.

Masdar Green REIT was established by Masdar as an investment vehicle for professional investors to invest in a professionally managed, sustainable, income-generating real estate portfolio in Masdar City.

The fund’s latest acquisitions include two fully occupied, LEED Platinum-rated buildings within Masdar City, Abu Dhabi’s pioneering sustainable community and innovation hub: the head office of Abu Dhabi Quality and Conformity Council, and Etihad Airways’s Eco Residences complex. A third property acquired, the Technology Innovation Institute headquarters, is LEED Gold certified. All three assets have achieved a 3 Pearl rating under the Abu Dhabi Estidama Pearl Building Rating System.

Anthony Taylor, Senior Executive Officer of MCML, said this second expansion phase demonstrated that sustainable urban development was a compelling commercial proposition, as well as environmentally responsible.

“Climate-resilient development is essential if we are to reach net-zero. The success and growth of Masdar Green REIT to date shows a credible pathway exists to achieve it. The fact that the REIT has more than doubled in assets in the two years since incorporation underlines the potential for sustainable real estate development in the region. It further highlights the broad appeal to investors of Masdar City, as a burgeoning innovation hub and thriving sustainable community,” he said.

Masdar Green REIT was launched in December 2020 with an initial portfolio of four commercial properties at Masdar City. These properties are the IRENA Building, home to the International Renewable Energy Agency and ENEC (Emirates Nuclear Energy Corporation), the Siemens Building, home to Siemens, Abu Dhabi Customs and the Tabreed HQ, and The Incubator building, occupied by Masdar City and Masdar Freezone, among others.

Together, the original properties cover a net leasable area of 58,063 square metres and were acquired at a value of AED948 million. As of December 31, 2021, the portfolio was valued at AED980 million, reflecting a gain of around AED32 million.

The fund offers Masdar the opportunity to raise third-party capital from its established real estate portfolio, while ensuring the integrity and, most importantly, the sustainability of the real estate assets within Masdar City. Following the new acquisitions and the green loan drawdown, Masdar Green REIT provides future investors access to a diversified portfolio with a high occupancy of 98 percent and an average unexpired lease term of over six years.

With its new portfolio and established track record, Masdar Green REIT is now entering into its next exciting chapter where it will target professional investors for cornerstone equity participation as it grows its portfolio with additional, pre-identified sustainable assets, within Masdar City, and in the wider UAE in years to come.

Source: Emirates News Agency