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United Arab Emirates : Dh700m bank financing deal signed by Meydan

June 5, 2014

The Meydan Group for a Dh700 million revolving project financing facility that will go towards building more than 1,500 villas for Emirates Group in Meydan City is tapping Commercial Bank International (CBI).

The loan tenor is for 8 years and structured in a way to keep the interest rate lower than the prevailing market rates , as per to a senior Meydan official.

It was previous year that Meydan signed its first financing deal with CBI, which is the local affiliate of Qatar National Bank and in which it has a 40 per cent stake. The value of that loan arrangement was not disclosed at the time, however market sources reckon it to be much higher than the Dh700 Million signed up yesterday.

Saeed Humaid Al Tayer, Meydan s chairman and CEO said, It was two years ago that Emirates Group bought 528 villas at Meydan, of which we have delivered 306 and the rest in the next two months . The latest deal will see a further 1,500 plus villas, taking the total to 2,028. Emirates plans to use them for their pilots as they keep adding substantial aircraft numbers to their existing fleet.

Simultaneously, Meydan and Emirates will explore whether further properties can be developed along the same lines. 500 villas in the new tranche are to be delivered by March next and the rest in five phases over a further 24-month period based on construction timelines.

The first of the Emirates villas will be prepared for occupation soon. A senior Meydan official said it is unlikely that the master-developer would go for similar arrangements with other big corporate entities in Dubai.

Meghnad Warrier, vice-president for finance and investment at Meydan Group said, This is a one-off and reflects the deep relationship between Emirates and Meydan, with the airline being a key sponsor of the races . However, there are other deals we have accommodated at Meydan, such as the one with Emirates NBD for three commercial properties, where up to 1,400 members of its staff will work.

There s also DHL which is finishing one of key logistics hub in Meydan and the rationale behind that was to have a facility equidistant between the new and the old airports. Many investors have been approaching us given the realisation that Meydan now occupies a most strategic location in Dubai.

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Source: TendersInfo (India)

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