THIS MORNING: FAB sees USD 1.4 bn in orders for latest Tier 2 issuance + port closures and pricing pressures are delaying Dubai Creek Tower

Good morning, friends. The war’s price tag is getting clearer. The big read today is S&P Global's most comprehensive damage assessment yet of the conflict’s economic toll on the UAE — A 2.7% GDP contraction in 2026, oil output off by more than half a mn barrels a day, and tourism, real estate, manufacturing, trade, and construction — together about 45% of GDP — all softened.

Yes, but — S&P’s overall read isn’t all alarm. It’s closer to cautious confidence in the depth of the country’s shock absorbers.

Meanwhile, Abu Dhabi is still preparing to spend a lot more, despite it all: MGX has just closed nearly USD 50 bn from sovereign funds and institutional investors globally.

And FAB is having a fab few weeks in the debt markets. Its second raise this month — a USD 750 mn Tier 2 issuance — drew nearly USD 1.7 bn in orders.

Also: Itochu joins Mubadala's Sirius Aviation Capital as a shareholder — the latest in a steady stream of global names anchoring themselves to Abu Dhabi's aviation infrastructure. More below.

FAB keeps the taps open

FAB has priced its USD 750 mn Tier 2 issuance — its second debt raise this month — and demand was strong. The orderbook peaked at nearly USD 1.7 bn before closing at USD 1.4 bn — nearly double the size of the issuance, Zawya reports. The 10.5-year notes, non-callable for 5.5 years, were priced at 140 bps over US Treasuries, tightening sharply from an initial guidance of 170 bps.

REMEMBER- The issuance follows a EUR 750 mn green bond last week that also drew some EUR 1.1 bn of orders and tightened to 74 bps over mid-swaps from an initial guidance of 100-105 bps. Additionally, the bank raised USD 700 mn through a five-year sukuk in May and made two separate issuances in January, along with a private placement raising USD 100 mn during the war.

Dubai Customs gives traders some breathing room

Dubai Customs has extended customs declaration deadlines under suspended duty arrangements by another 120 days, covering import-for-re-export transactions, temporary admissions, and transit shipments across all modes, according to a notice on its website (pdf). The extension runs from the expiry of the original suspension period, which covered 27 February through 31 July 2026.

Dubai Creek Tower is facing a delay

Port closures and pricing pressures are pushing back Emaar Properties’ Dubai Creek Tower project, with the tendering process for the landmark delayed by three to four months, Emarat Al Youm reports, citing comments by Emaar founder Mohamed Alabbar. Recent port closures have driven up the cost of construction materials and, in turn, disrupted the overall plan for the development.

BACKGROUND- The real estate developer was expected to spend over AED 14 bn on its Creek Tower and Creek Mall developments, with the tender process for the tower originally set to be issued around this time, Zawya previously reported. No new details were given on the project’s revised cost or construction schedule. Still, Alabbar has signaled confidence in Dubai, recently unveiling plans for a AED 200 bn mixed-use project.

IN CONTEXT- The war triggered a major slowdown in project awards in the UAE, which dropped to 16 in March, down from 52 in February. Contract values saw a similar dip, falling 26% m-o-m to USD 9.7 bn. In tandem, the UAE saw a surge in construction costs, with building materials prices rising by as much as 14% amid shipping construction and strained contractor capacity.

The retail sukuk era begins

The UAE’s first sovereign retail T-sukuk opens for subscription today, giving citizens and residents direct access to a government-backed, shariah-compliant instrument from a minimum subscription threshold of AED 1k, Wam reports.

The details: The AED 50 mn issuance has a two-year tenor and a 4.30% annual coupon rate, paid every six months, with subscriptions open through 30 June. Issuance is set for 1 July, followed by a Nasdaq Dubai listing and secondary-market trading from 2 July, supported by a market maker and liquidity providers.

How to buy: Investors can apply through the DFM’s subscription platform or app iVestor, or the digital channels of our friends at Mashreq, Emirates NBD, Emirates Islamic, ADIB, and Ajman Bank, obtaining a DFM Investor Number where required.

ICYMI- First unveiled last year, the program’s entry threshold was later cut from AED 4k to AED 1k to widen access. Unlike the UAE’s fractional sukuk initiative, which offers pieces of existing securities at market prices, this program gives investors newly issued sovereign sukuk at par through a primary-market subscription.

Tanker payday

Adnoc crude export push is helping drive tanker rates to record highs as traffic through the Strait of Hormuz slowly resumes, Reuters reports. The company has launched a flurry of tenders and is urging buyers to load inside the Gulf, adding to demand for scarce vessels.

Daily hire rates outside the strait have jumped to USD 190.5k from USD 106.5k a week ago, while earnings for very large crude carriers transporting Gulf crude through Hormuz have hit a record of nearly USD 470k a day.

The bottleneck is still severe: As many as 100 tankers remain stuck inside the Gulf with cargoes onboard, while traffic through Hormuz is still a fraction of the pre-war average of 125 ships a day.

REMEMBER- The UAE is trying to cut Hormuz out of the equation. Adnoc is fast-tracking a second pipeline to double crude flows through Fujairah by 2027, while plans are under study for a third petroleum pipeline, a new eastern harbor, and expanded rail and road links.

Data point

1st — that’s where Dubai ranked internationally in attracting new foreign direct investment (FDI) projects last year, according to Financial Times’ fDi Markets data cited by Wam. Dubai accounted for 7% of all newly announced FDI projects worldwide in 2025, its highest share on record.

By the numbers: The emirate attracted 1,253 projects — up 10.5% y-o-y and its highest count since 2015. Announced FDI capital reached USD 8.8 bn (c. AED 32.4 bn).

The expansion was broad-based: Dubai remained the top destination for regional headquarters and AI-related projects for a fourth straight year, ranked first in transport and storage, and took the global lead in manufacturing FDI for the first time. It also topped rankings across ICT and electronics, financial services, life sciences, clean tech, healthcare, and e-commerce.

PSAs

RAKBANK is the latest UAE bank to bundle services for SMEs, launching a women-focused business banking package that waives fees for 12 months and rolls in accounting software, ins., multi-currency support, and international transfers without charge, Khaleej Times reports. The program is available for women until 10 December.

The Dubai Land Department launched a flexible rent scheme called Flexi Rents, allowing tenants to pay monthly or in installments of up to 12 months, rather than the lump-sum check model that has long defined the Dubai rental market, Gulf News reports. Participating landlords can also waive rental increases and late-payment fees in some cases.

The initiative initially covers 12 real estate companies, with the department saying it will expand across the market in later phases.

SOUND SMART- Dubai’s rental market runs almost entirely on post-dated checks — typically one to four per year — which effectively requires tenants to have large sums locked up in advance.

The long-awaited Etihad Rail service is starting at the end of this month with a phased rollout. Trial operations will kick off between the Mohamed Bin Zayed City Passenger Train Station in Abu Dhabi and Fujairah on 30 June, according to Abu Dhabi Media Office. It’ll take just one hour and 45 minutes to travel between the two cities, with online ticket booking now open and fares starting from AED 55.

Next up: The Dubai Train Station and Al Dhaid Train Station in Sharjah open on 30 September. Al Dhafra comes online at the end of December, and the Sharjah Train Station opens in March 2027.

REFRESHER- The UAE’s national passenger railway network will initially connect 11 cities, with a further seven set to be rolled out in phases. French transportation firm Keolis will operate the network, which will include a high-speed line to cut journeys between Dubai and Abu Dhabi to 30 minutes. The 13 trains in the fleet each have a 400-person capacity.

WEATHER- Pre-cool your car… Dubai and Abu Dhabi both top out at 42-44°C today — Dubai at 44°C, Abu Dhabi at 42°C, with lows of 32-33°C.

The big story abroad

The latest update in the US-Iran war is a familiar one, with the US senate moving to end the conflict, mirroring a move by the House earlier this month. The largely symbolic decision signals growing reluctance among Republicans to back the war, just as the Trump administration is expected to petition Congress for tens of bns of USD to fund the conflict.

The selloff continues: Chipmaker equities saw losses amid a wider selloff yesterday, as investor confidence wanes amid expectations of rising interest rates and worries over the massive scale of Big Tech’s AI investments. Leading the drop were Micron and Qualcomm. Industry giant Nvidia also shed 4.1%, pulling its total market capitalization under the USD 5 tn mark.

Equities are on track to recover during today’s session, with Asia-Pacific markets already setting the stage — South Korea’s Kospi is up 2.7% this morning as investors buy the dip. US futures are trading higher as signs of increasing traffic crossing the Strait of Hormuz keeps oil prices down.

SpaceX raised USD 25 bn by issuing senior unsecured notes within two weeks of its blockbuster IPO. The company said it will use the proceeds to fully repay a bridge loan, cover associated fees, and fund general corporate operations.

Meta under scrutiny: Washington is reportedly pressuring Meta to submit its AI models for voluntary review in what seems to be an attempt to tighten oversight of the US AI scene. The pressure on Meta — the last holdout among major AI firms — echoes the government’s directive for Anthropic to restrict access to its programs earlier this month.

The young generation’s plan: As we inch closer to the largest transfer of wealth in history, the question of how the younger generation will spend the USD 83.5 tn estimated to be inherited over the next two decades is one on wealth managers and financial institutions’ minds. UBS tells CNBC that the shift may divert inherited wealth away from traditional family assets, especially real estate, as younger heirs diversify their holdings across different asset classes and global markets.

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