Related Cos, the New York developer founded by billionaire Stephen Ross, and its partner Gulf Capital plan to build a $1 billion shopping mall focusing on department stores in Abu Dhabi.
Gulf Related, the joint venture undertaking the project, is also aiming construct two towers connected to the mall that will include a 300-room hotel as well as 120 serviced apartments, Kenneth Himmel, president and chief executive officer of Related Cos told reporters in Abu Dhabi on Sunday.
Sowwah Central, as the project is named, is the venture’s second development on Sowwah island, which will be the location for a financial district and Abu Dhabi’s stock exchange.
The mall, due to be completed in 2017, will be financed by a combination of equity and debt, Himmel said. Gulf Related bought the land last year from Abu Dhabi’s sovereign investment fund Mubadala Development Co, which hasn’t yet decided whether it will invest in this project, Himmel said.
Gulf Related may assume debt to fund as much as 60 per cent of the development, designed to include cinemas, health clubs and restaurants, Himmel said. He declined to specify the amount of equity Gulf Related plans to invest in the project or the price of the land.
“Gulf Capital and Related are anchoring this project,” said Karim El Solh, chief executive officer of UAE’s private equity firm Gulf Capital. “We are approaching investors such as sovereign wealth funds, pension funds, insurance companies, financial institutions and family owned companies who are looking for a long-term cash yield.”
The response has been positive, helped by the company’s ability to get commitments for seven- to 10-year leases from retailers it’s in discussions with, El Solh said. Investors should expect an annual yield of 12 per cent to 13 per cent once the mall is fully occupied, he said.
Heavyweights lead index drop on Muscat bourse
Selling pressure in index heavyweights weighed on the MSM 30 Index which declined 0.39 per cent to close at 5,726.16 points. The MSM Shariah Index closed at 874.98 points, down 0.07 per cent.