Property prices in the UAE, the second-biggest Gulf Arab economy, have dropped about 27 per cent since October 2014 amid excess supply and sluggish economic growth.
Monday 02, September 2019
Dubai-based property developer, Sobha is planning an initial public offering (IPO) of its UAE business in 2022 even as a property slump weighs on developers in the GCC region, reported Bloomberg.
P.N.C. Menon, the Founder of Sobha, said that the company will wait to meet profitability projections before making a final decision on the IPO and no final decision has been reached on where to list the shares.
The property developer expects sales revenue to jump to about AED 2 billion ($545 million) this year from AED 620 million in 2018 as it hands over more homes in its Sobha Hartland development.
Menon said that about 6,000 homes will be delivered at the $4 billion project over the next six years.
Emaar Properties, the biggest developer in Dubai, this month posted a four per cent decline in first-half revenue.
Sobha is targeting annual sales of 2,000 housing units in Dubai that will result in revenue of AED 2.5 billion and profit of about AED 400 million by 2022, said Menon.
Additionally, Monon said that prices in Dubai have stabilised and will stay like this for the next three to five years, adding that the market is crowded with developers and only the best will survive over the next five years.