Masdar Green REIT, the first Real Estate Investment Trust in the UAE to invest only in sustainable real estate, has purchased additional real estate worth AED934 million. This increases the value of the Masdar Green REIT portfolio to AED1.91 billion. Further assets are also being assessed for additional investments in the future.
This news was revealed during Abu Dhabi Finance Week by the fund's management, Masdar Capital Management Limited (MCML). It comes after the fund acquired a US$200 million green loan from First Abu Dhabi Bank (FAB) in January to support the REIT's expansion.
Masdar created the Masdar Green REIT as a platform for professional investors to participate in a portfolio of sustainably managed, income-producing real estate in Masdar City.
THE ACQUIRED PROPERTIES
Two LEED Platinum-rated buildings in Masdar City are among the fund's most recent purchases. These buildings are the headquarters of the Abu Dhabi Quality and Conformity Council and Etihad Airways' Eco Residences complex. Both buildings are part of Abu Dhabi's forward-thinking sustainable community and innovation hub. The Technology Innovation Institute's primary office was also purchased as a third property. This building is LEED Gold certified. According to the Abu Dhabi Estidama Pearl Building Grade System, all three properties have received a 3 Pearl rating.
According to Anthony Taylor, Senior Executive Officer of MCML, this second growth phase proved that sustainable urban development was both an alluring business opportunity and a responsible environmental choice.
The development and success of Masdar Green REIT demonstrates a proven path to achieving a net-zero and climate-resilient real estate environment. Since being established two years ago, the REIT’s assets have more than doubled. This not only demonstrates the immense potential that sustainable real estate developments have within the MENA region. But it also demonstrates Masdar City’s attractiveness amongst investors as a flourishing sustainable community and progressive innovation centre.
BACKGROUND OF THE MASDAR GREEN REIT
When it was introduced in December 2020, four commercial buildings at Masdar City made up the initial Masdar Green REIT portfolio. These buildings are collectively occupied by the likes of Siemens, Abu Dhabi Customs, and the International Renewable Energy Agency amongst other noteworthy organisations.
Together, the original properties total 58,063 square meters of net leasable space and were bought for AED 948 million. The portfolio had a value of AED980 million as of December 31, 2021. This represents an approximate gain of AED32 million.
The fund gives Masdar the chance to use its established real estate holdings to attract money from external sources. Equally, the fund guarantees the reliability and, most crucially, the sustainability of the Masdar City real estate holdings. Future investors will have access to a diverse portfolio through Masdar Green REIT after the additional purchases and the repayment of the green loan. The portfolio also has an attractive average remaining lease term of nearly six years and a high occupancy rate of 98%.
With a fresh portfolio and a proven record of accomplishment, Masdar Green REIT is about to embark on an exciting new phase. This will see it seek out professional investors for key equity participation as it expands its portfolio over the coming years with new, pre-selected sustainable assets in Masdar City and the broader UAE.