UAE SMEs are borrowing again, but the conflict’s squeeze isn’t over

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WHAT WE’RE TRACKING TODAY

THIS MORNING: Adipec loses out on Exxon, Chevron execs as fears of regional escalation mount

Good morning, friends, and happy Friday. It’s been a punishing year for the UAE’s small businesses: freight costs have soared, shipments are taking twice as long, and customers are paying later than ever. So our big story this morning brings welcome news. SME lender Beehive tells us small businesses are borrowing again, with October on track to be its best lending month on record, and the stress that showed up on its loan book over the summer has largely eased.

The conflict’s long tail runs through the rest of the issue, though. Borouge is paying double to ship its products without passing through Hormuz, FAB is still setting aside more for bad loans, and Sharjah has become the latest emirate to close its beaches as an oil spill edges toward a desalination plant.

It’s now reaching the UAE’s conference circuit, too. ExxonMobil and Chevron have cancelled plans to send executives to Adipec in Abu Dhabi next week, citing security concerns, sources told Reuters. Organizer DMG says US participation remains strong, with more than 120 American exhibitors, second only to China, and a record turnout expected from more than 170 countries.

Sound familiar? Earlier this month, several top energy executives were dropped from the schedule of the WPC Energy Congress in Riyadh after deadly attacks on the Saudi capital claimed by the Houthis, though that event went ahead. The news comes as fears mount that the US could resume strikes on Iran after the midterms.

Adnoc eyes sale of VTTI stake

Adnoc may sell its entire 10% stake in global energy storage operator VTTI, with India’s Adani Group among the suitors, Bloomberg reports, citing people it says are familiar with the matter. A transaction could value Rotterdam-based VTTI at c. EUR 3 bn (USD 3.4 bn), which by our math would put Adnoc’s stake at around EUR 300 mn. Co-owners IFM Investors and Vitol, which hold 45% each, may also sell down their stakes. Other bidders are in the mix, and the talks may not end in a sale.

Why buyers want in: Energy traders value storage more when supply is disrupted. VTTI stores oil products, chemicals, biofuels, and LNG at terminals across Europe, the Middle East, Asia, Africa, and the Americas, including the UK’s Dragon LNG and Italy’s Adriatic LNG. Adriatic LNG’s main customer, Edison, has been taking replacement cargoes there since QatarEnergy declared force majeure on its supply contract. VTTI also runs a terminal in Fujairah.

Selling would unwind a 2019 investment for Adnoc. It bought into VTTI that year to secure storage in key export markets across Asia, Africa, and Europe, along with more capacity in Fujairah, its main storage hub. At the time, Adnoc said storage closer to customers would give it more control over where, when, and how its products reached them.

Oracle plans more for UAE, KSA

US multinational tech giant Oracle is doubling down on its UAE and KSA footprint, executive VP for EMEA Cormac Watters told The National. Expansion in Qatar and Kuwait is also in the cards, he said, in another sign that Western players are staying the course on the AI buildout despite geopolitical instability.

Why now? Oracle cited “huge” demand for its data centers and has plans to set up several over the next six months, Watters said. The firm already has a presence in the UAE, including as a partner in the Stargate UAE project, and its Saudi footprint involves infrastructure linked to Vision 2030.

Watters didn’t disclose the specific locations, saying Oracle doesn’t “want any bad actors to somehow figure it out.” That comes after two AWS facilities in the UAE were struck during the regional war, with data held solely in one location still not recovered. Another sensitive point is sovereignty, with Watters saying clients wanted to know where data would ultimately be stored and who has access to “the big kill switch.”

Spilling over

Sharjah is the latest emirate to close down all its beaches after the recent oil spill off the coast of Umm Al Quwain — and the spill is now raising bigger concerns. Fears are mounting that the spill could affect nearby desalination plants, having come as close as 2km to one facility on the border between Umm Al Quwain and Ras Al Khaimah. Maritime intelligence firm Windward said the leak threatened the plant’s intake, according to Reuters; however, this hasn’t been confirmed by authorities.

REMEMBER- The spill — which is suspected to have been the result of a projectile attack on a crude vessel, though UAE officials have yet to confirm the cause — shut down beaches across Ras Al Khaimah and Umm Al Quwain over the weekend. Beyond the environmental concerns, the spill comes at the start of the winter tourism season, which could be a big blow for Ras Al Khaimah, an emirate that has built its tourism pitch on beaches and luxury resorts.

Data point

USD 8.7 bn — that’s how much the UAE expects its new economic partnership agreement with Canada to add to its GDP by 2033, Foreign Trade Minister Thani Al Zeyoudi told state news agency Wam. The pact marks the UAE’s first Comprehensive Economic Partnership Agreement (CEPA) signed with a G7 country. Al Zeyoudi expects the agreement to lift UAE exports to Canada by about USD 11.8 bn over the same period, nearly triple last year’s total non-oil trade between the two countries of c. USD 4.2 bn. Usual exports include iron, aluminium, metals, gold, certain electronic products, and pharma and food products.

PSA

WEATHER- Dubai is set for a high of 36°C, while it’ll hit 35°C in Abu Dhabi. Both emirates will see an overnight low of 26°C.

The big story abroad

Investors are losing patience over Big Tech’s AI spending. Alphabet shares fell 13% yesterday, wiping a record USD 500 bn off its market value, the second-biggest one-day loss in Wall Street history, the Financial Times reports. Amazon and Intel slid in after-hours trading, sending Nasdaq-100 futures down 1.7% and pushing investors into US Treasuries.

Alphabet burned through USD 9.1 bn in free cash flow in 3Q as AI spending rose to USD 51.3 bn, while revenue from search slowed to 12% growth as AI answers ate into ad sales.
Amazon fell 6% after missing estimates, even as its cloud unit AWS grew 39%, its fastest since 2021. Intel dropped 22% on a weak outlook, blaming a PC slump caused by memory chip shortages.
Microsoft stood out with positive free cash flow, but it’s still raising USD 25 bn in bonds to help fund USD 170 bn in capital spending this year (CNBC).

ALSO- Binance has suspended all deposits and withdrawals after a suspected hack that could be the biggest crypto theft ever, possibly trumping Bybit’s USD 1.5 bn hack in February 2025, Bloomberg reports. The exchange says about USD 3 bn in assets has been frozen so far and that it will cover all losses. Tether and Circle have frozen some USD 2.3 bn in stablecoins linked to the incident. BTC fell to its lowest since September.

MEANWHILE- European Central Bank President Christine Lagarde will step down on 7 February, about nine months before her term ends, Bloomberg reports. EU governments are expected to choose a successor before the end of the year, most likely the Bank for International Settlements’ Pablo Hernandez de Cos or former Dutch central bank chief Klaas Knot.

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UAE SMEs are borrowing again after a punishing year -Beehive’s CEO

UAE small businesses are borrowing again after the regional conflict froze lending in the spring, Beehive CEO Peter Tavener tells EnterpriseAM. The SME lender expects to approve about AED 150 mn in UAE loans in October, which would make it its best month on record, beating February’s pre-conflict peak. Tavener expects monthly approvals to pass AED 200 mn by 2Q 2027. Most of the demand is for growth rather than survival, he says, and early signs of borrower stress over the summer have since eased.

IN CONTEXT- Beehive is one of the UAE’s largest SME lenders. It has lent close to AED 6 bn since launch and has a loan book of about AED 1.2 bn. In 2025, it secured an initial AED 500 mn funding commitment from Goldman Sachs, with Magellan Capital participating, and Tavener says the facility can now support up to AED 2 bn of UAE lending. It lends to the part of the market that’s underserved: businesses with AED 5-50 mn in revenue. Remember: SME lending made up less than 10% of UAE bank lending in 2024.

Lending fell sharply in March and April on the back of SMEs holding off borrowing, with Beehive itself tightening its lending criteria, Tavener tells us. On Beehive’s book, there were signs of stress earlier in the conflict — but they’ve since improved.

Beehive tracks loans five to 30 days overdue as its early warning sign. That share rose to about 6% in June and July, which Tavener says made him “a little bit nervous,” before falling back to its pre-conflict level at about 2.5%. Some borrowers asked to restructure in March, April, and May, mostly to delay one or two payments by about 90 days, and Beehive approved most of those requests.

Why it matters: It’s been the hardest year for Emirati small businesses since the pandemic, with higher shipping costs, slower deliveries, and slower payments all squeezing buffers. The cost of shipping a container from China has risen from USD 1.2k before the conflict to about USD 10k, Tavener says. Delivery times are the bigger problem: a shipment that took 60 days can now take 120, which delays sales and the money they bring in.

Those pressures are why firms were given a helping hand earlier in the year. The Central Bank of the UAE introduced a resilience package in March that eased capital and liquidity rules for banks and let them give struggling borrowers payment deferrals without classifying those loans as distressed. About AED 13.5 bn in repayments were deferred for more than 135k customers.

The squeeze

How hard SMEs were hit depends on whether a business can pass the cost on. A specialty food importer on margins of 20-30% can absorb a 10% rise in costs and still make money, Tavener explains. On the other hand, an electronics or white goods importer on margins of 1-2% can’t; it has to raise prices. Hardest hit are businesses locked into fixed-price contracts signed before the conflict, especially in construction, where already thin margins have been crushed by subsequent cost spikes.

For others, the problem was demand. Travel, tourism, events, and some logistics firms were hit hardest when activity stopped in the spring and have not fully recovered, though Tavener says they are coming back quickly. Businesses serving residents have fared better: food and beverage, particularly lower-priced outlets, have rebounded strongly. Services and manufacturing firms, which make up a large share of Beehive’s mostly B2B portfolio, are holding up well. Trading companies are recovering too, but Beehive caps lending to them because their default rates have historically run higher.

SMEs are being squeezed on payments from both sides. Overseas suppliers are demanding more upfront payments, Tavener says, while customers are taking longer to pay. That’s long been a problem in the UAE: a client that would settle an invoice in 60 days in Europe or the US might take 180 days here, he says. In the meantime, the SME still has to pay its staff, rent, and suppliers, so it borrows to bridge the payment lag. “There is a funding gap, but it’s caused in this region by the fact that payment terms are stretched beyond what is normal,” he says.

Survey data backs that up. Around two in five B2B invoices in the UAE are paid late, and far more businesses say customers are paying more slowly than more quickly, according to Atradius’ latest Payment Practices Barometer, carried out in 2Q 2026. As a result, 47% of companies say they need more financing and 46% say they have less liquidity headroom, while concern is growing that overdue invoices will turn into bad debt.

The outlook

Beehive is keeping credit tight into 2027. It tightened its credit policies sharply in March and has loosened them only slightly since. They’ll stay tighter than before the conflict until at least the end of the year, possibly into early 1Q 2027, “to ensure that any remnants of stress have fully flushed through,” Tavener says. Beehive mainly judges resilience by liquidity cover: it wants a borrower’s average monthly cash balance to be about 2.5x its monthly loan repayments to all lenders. When one of a borrower’s clients starts paying late, Beehive stops financing invoices to that client but continues lending against the borrower’s other customers.

What’s next: The deferred bank loans started coming due in September and this month, and Bloomberg Intelligence expects any stress to show up six to 12 months later. Beehive will loosen its credit policies once that stress has worked through, Tavener says.

BY Venture Partners closes USD 60 mn Fund III to back early-stage AI startups

Dubai-based BY Venture Partners closed its third fund at USD 60 mn to back early-stage AI startups, bringing its assets under management to above USD 200 mn, according to a press release. The Dubai Future District Fund anchored the fund, with MultiLane, Transmed Capital, the Idriss Family Office, and other institutional and private investors also taking part.

The fund will mostly invest up to USD 1 mn per startup, from pre-seed to Series A, in AI-native companies building tools for enterprise workflows. It has already made 15 of a planned 40 investments, including PQ Shield, Cosyne, and Isometric, as well as Huspy and Invisible, which BY also backed through its earlier funds.

BACKGROUND- Most of BY Venture Partners’ capital goes abroad. BY invests across more than 16 markets and has deployed about two-thirds of its capital outside MENA, mainly in North America and Europe. It has now landed a mandate to run the Lebanese Angel Investor Network, which links Lebanese founders with diaspora investors, and has committed to reinvest half of its carried interest in Lebanon’s startup ecosystem, according to the statement.

IN CONTEXT- Regional investors have accounted for a larger share of regional investments this year as foreign capital takes more of a backseat amid regional tensions. MENA-based investors supplied 58% of capital deployed in 9M 2026, up from 50% a year earlier and marking a three-year high for the share. Meanwhile, foreign investors’ share declined to 42%, with US-based investor deployment falling to 9% from 15%.

The fund also targets a tier that has historically been underfunded: Series A. MENA’s early-stage transaction count fell 45% y-o-y in the first nine months of 2026, even as mega-rounds hit a record USD 813 mn in 3Q. In the UAE, the number of Series A rounds also halved in 1H, as foreign investors write smaller checks and startups struggle to find lead investors to lead their fundraising.

The caveat: AI companies took around 60% of what was raised by Series A startups in 1H. The fund adds capital where it’s scarcest, but in the sector that needs it least.

Mashreq posts a record nine months as recoveries flow in, while FAB’s impairment charges climb and Borouge and DFM feel the conflict’s drag

Mashreq logs double-digit growth in 3Q

Broad-based growth drove a 21% y-o-y rise in bottom-line earnings for our friends at Mashreq, with net income attributable to owners reaching AED 2.1 bn in 3Q 2026, according to the lender’s management discussion and analysis report (pdf). Net income before tax rose 19% y-o-y to AED 2.5 bn during the quarter.

Operating income rose 12% y-o-y to AED 3.6 bn in 3Q on the back of an 8% yearly jump in net interest income to AED 2.3 bn. Non-interest income accounted for a larger share of the top line compared to last year, rising 19% to AED 1.3 bn. The biggest growth came from investment income, which shot up 168% y-o-y to AED 264 mn on equity portfolio gains, offsetting a 7% dip in net fees and commissions.

Mashreq booked a record AED 7.3 bn in income before tax in the first nine months of the year, up 18% y-o-y. Net income after tax rose 18% to AED 6.1 bn. Operating income grew 11% to AED 10.4 bn, with net interest income up 7% to AED 6.5 bn and non-interest income up 18% to AED 3.9 bn, taking its share of the total to 37%.

Behind the numbers: Lending growth and lower provisions drove the increase. Customer loans grew 33% y-o-y to AED 190.6 bn, with strong lending to both wholesale and retail clients. Impairments swung to a net release of AED 116 mn in 9M, compared to a charge of AED 366 mn a year earlier, as recoveries on loans previously written off outpaced new provisions. That swing accounted for AED 482 mn of the rise in pre-tax income. Operating expenses rose 13% to AED 3.3 bn, mainly on investment in AI, digital platforms, and staff, taking the cost-to-income ratio to 31.4% from 30.7%.

FAB’s net income grows 6.5% y-o-y, beating analyst estimates

First Abu Dhabi Bank (FAB) posted net income of AED 5.7 bn in 3Q 2026, up 6.5% y-o-y and flat q-o-q, beating analysts’ estimates, according to the lender’s management discussion and analysis report (pdf). Operating income rose 9.3% y-o-y to AED 10.21 bn. Net interest income fell 6.2% q-o-q as net interest margin narrowed to 1.85% from 1.99%, while fees, FX, and investment income picked up the slack, lifting non-interest income 9.5% q-o-q.

On a 9M basis, net income rose 2.8% y-o-y to AED 16.5 bn, well behind the 7.5% growth in operating income to AED 29.7 bn. Net impairment charges climbed 33.3% y-o-y to AED 3.1 bn, which the bank attributed to a cautious approach to the “evolving risk environment.” Net interest income grew 11.1% y-o-y on higher volumes, with net loans up 10% YTD to AED 679 bn, credited to growth in wholesale and retail lending.

REMEMBER- Impairments have weighed on UAE lenders all year. Emirates NBD, FAB, and ADCB have all booked extra impairment charges in response to the regional conflict, with FAB alone setting aside AED 300 mn in management overlays — provisions beyond what its standard models required. FAB’s nine-month charge includes a AED 350 mn management overlay for conflict-related credit risk, the bank’s financial statements (pdf) showed. That’s smaller than the AED 650 mn it reported at the half-year mark.

Land leases continue to prop up Tecom’s bottom line

Dubai business district operator Tecom Group reported a 12% y-o-y increase in recurring net income to AED 417 mn in 3Q 2026, while revenue rose 12% to AED 809 mn, according to the company’s earnings release (pdf). EBITDA grew 11% y-o-y to AED 627 mn. In the first nine months, recurring net income rose 10% y-o-y to AED 1.2 bn on revenue of AED 2.3 bn, up 11%.

Land leases did most of the work in 3Q, with revenue from the segment jumping 35% y-o-y to AED 202 mn, which the company attributes to expansion of its industrial land portfolio. Commercial revenue grew 6% y-o-y to AED 390 mn and industrial revenue rose 11% to AED 125 mn. Occupancy across its commercial and industrial assets held at 97%, while customer retention rose to 95% from 93% a year earlier.

Logistics costs, lower sales eat into Borouge’s 3Q income

Borouge’s net income fell 63% y-o-y to USD 109 mn in 3Q 2026, while its revenue was flat at USD 1.4 bn, according to its management discussion and analysis (pdf). The petrochemicals company sold 21% less than a year earlier, as plants ran at 76% utilization on tight ethane supply. Higher prices made up for the lost volume on the top line but not on income. Selling and distribution costs doubled to USD 220 mn as Borouge shipped everything via alternative routes to avoid the Strait of Hormuz, and propylene feedstock costs climbed.

On a 9M basis, net income fell 41% y-o-y to USD 455 mn on revenue of USD 4.03 bn, down 4%. Sales volumes fell 19% y-o-y, partly offset by a 19% rise in average selling prices. The quarter-on-quarter picture is better: sales volumes rose 22% from 2Q as ethane supply recovered, but average selling prices fell 19% after the spike in 2Q, taking net income down 43% q-o-q.

Things are looking up from here: Borouge expects 4Q adjusted EBITDA to come in “significantly higher” than 3Q, with utilization reaching about 90% in October and polyolefin benchmark prices above 3Q levels. It paid an interim dividend of 8.1 fils per share in September and reaffirmed its 16.2 fils annual payout, which it has committed to as a minimum until at least 2030.

DFM results dip in 3Q

The Dubai Financial Market (DFM) saw its net income slide 7% y-o-y to AED 130.3 mn in 3Q, as fee income dropped 11.7%, according to the Dubai stock exchange’s financials (pdf) and an earnings release (pdf). Trading commission fees fell 10.5% to AED 101.4 mn, and clearing, settlement, and depositary fees fell 29% to AED 15.3 mn. A 16% rise in investment income to AED 64.4 mn softened the blow, so total income slipped only 4.1% to AED 196.2 mn.

The third quarter cooled after a strong first half. For the first nine months, fee income from DFM’s exchange operations rose 24.8% y-o-y to AED 511.2 mn, as trading commission fees climbed 26.4% to AED 392.1 mn. Net income still fell 36.9% to AED 537.7 mn, because 9M 2025 included a one-off AED 461.9 mn gain from the sale of an investment property. Excluding that gain, pre-tax income rose about 25% y-o-y to AED 586.4 mn. Total income fell 31.1% to AED 753.2 mn.

Average daily trading value was up 25% y-o-y to AED 883 mn, bringing the total traded value to AED 162 bn, up 22%. The DFM rounded out 9M with a market capitalization of AED 993 bn, while 55.5k new investors joined the market, 72% of whom were foreigners.

The Year of the Family puts financial continuity on the agenda

The UAE’s Year of the Family is a prompt for institutions to look past the next quarter. The initiative emphasizes care, connection, positive values, and intergenerational continuity, and it ties into the National Family Growth Agenda 2031. For banks, the obvious starting points are savings, protection, and access to finance. But a family’s security also depends on things outside its bank account.

Begin with the household itself. Over a lifetime, a family has to plan for marriage, a home, school fees, caring for relatives, retirement, and what it eventually passes on. Savings, the right insurance, responsible credit, and a working grasp of money can soften the blow when circumstances change.

Add a business to the picture and legacy gets harder. A family enterprise might be anything from a kitchen-table operation to a major company, and ownership is only part of what gets handed down. The culture goes with it, along with how the business actually runs, who its customers are, and the judgment to make hard calls. None of that transfers by accident. It takes succession planning, governance, financial literacy, and deliberate knowledge transfer.

You have probably heard of the “three-generation rule,” the idea that family wealth rarely survives to the grandchildren. It is worth treating with caution. Harvard Business School faculty have pointed out that the claim is often misread and largely traces back to a study from decades ago. Families still need to plan for succession, and banks can help through financial-literacy programs, early conversations, and structures for passing wealth on responsibly.

The next generation also inherits the conditions it grows up in. According to UNICEF, climate-related and environmental pressures can disrupt access to nutritious food and safe water, raise disease risks, damage homes, and weaken the healthcare and education systems. Children, who are still developing and depend on the adults around them, are the most exposed.

Financing resilient housing and infrastructure, water and energy efficiency, healthcare and education access, and small businesses can help families weather those pressures. At the household level, resilience is unglamorous: reliable water, a cooler home, a clinic within reach, or a business that can keep its doors open.

Taking the long view changes what counts as prosperity. Money matters, but so do trust, health, education, and confidence in the future. A family’s legacy is not only what it owns, but whether the next generation can manage it and whether the world they inherit lets them build on it.

So the question for banks is a simple one: what do our financing decisions leave behind? If they help families absorb shocks, plan further ahead, and give their children a better start, then we are doing our part.

Faisal AlShimmari, head of ESG, Mashreq

Arada taps Aastha Billore as CIO of new fund management arm

Arada hired Aastha Billore (LinkedIn) as chief investment officer of Arada Capital, the fund management arm it recently set up in Abu Dhabi Global Market (ADGM), the developer said in a press release. Abdulla Mohamed Al Mazrui also joined Arada Capital’s board. The appointments follow the hiring of Moustafa Fahour (LinkedIn) as CEO.

Billore brings nearly 20 years of experience, with her career including several senior roles focused on corporate development and capital-raising at the likes of Shamal Holding, Careem, Dubai Holding, and Meraas.

ICYMI- Announced earlier this year, Arada Capital is planning to let funds from institutional and qualified investors into its real estate pipeline while targeting USD 5 bn in assets under management within four years of starting up. The fund will give it access to an alternative source of capital at a time when its recent debt has become more expensive and as it pushes ahead with acquisitions.

Absa opens in DIFC + DFSA fines Moody’s for data privacy failings

Absa opens in DIFC

South Africa’s third-largest bank Absa Group has followed through on its plan to open up an office in Dubai International Financial Center (DIFC), according to a press release. The expansion is aimed at tapping into the growing Gulf-Africa trade and investment ties, which already attracted its peer Investec to the emirate. Original plans had targeted a 1Q opening date, though the firm gave no reason for the delay.

What attracted Absa: Absa flagged prospects in the fast-moving consumer goods, logistics, infrastructure, and energy sectors, as well as in cooperation with institutional investors and corporates in the region. The group said it secured a category 4 license and will be able to arrange investment transactions and advisory services for financial products and credit.

Moody’s in the doghouse for privacy failings

Moody’s fined over data leaks: The Dubai Financial Services Authority (DFSA) slapped a USD 585.8k fine on Moody’s Investors Service Middle East for breaching several data confidentiality rules, the regulator said in a statement. Moody’s failed to ensure employees didn’t disclose confidential information and failed to implement adequate safeguards for data confidentiality between December 2023 and May 2026. Moody’s agreed to an early settlement on the issue, meaning it avoided a larger fine of USD 836.9k.

Gulf sovereign funds could start paying tax on UK property from 2029

The UK will start taxing sovereign wealth funds on their British property from 1 January 2029, ending a long-standing exemption that Gulf investors have used to build large real estate portfolios in London, the Financial Times reports. Sovereign investors will pay tax on rental income from UK property they hold directly and on gains when they sell it, similar to other non-resident investors, according to the government’s consultation paper (pdf). London expects the change to raise about GBP 690 mn a year by FY 2029/30.

Most of what sovereigns earn in the UK beyond property stays taxfree, including interest on UK bonds and deposits, dividends from UK shares, and the earnings of the London offices many Gulf funds use to manage their global portfolios. State-run pension funds also get an extra break and won’t pay tax on gains when they sell UK property.

Why it matters for the Gulf: Sovereign funds such as the Qatar Investment Authority (QIA) have significant investments in London, and UAE sovereign money has poured into build-to-rent housing. The QIA owns Harrods and Chelsea Barracks, has stakes in the Savoy Hotel, the Shard, the Olympic Village, and the HSBC tower, and it took over Canary Wharf Group with Brookfield in a GBP 2.6 bn transaction in 2015. The Abu Dhabi Investment Authority has a GBP 2.2 bn partnership with Greystar to build rental housing in London and nearby commuter towns. And Saudi Arabia’s Public Investment Fund bought a stake in Selfridges, including its property portfolio. Not all of these holdings will be caught, though. The tax targets property sovereigns hold directly, and assets held through UK companies already pay corporation tax.

London is offering ways to soften the blow: Sovereigns will be able to move their buildings into real estate investment trusts (REITs), which pay no tax themselves and pass rental income to owners. A sovereign that owns a REIT through a dedicated UK company will pay a flat 15% on that income, less than the full corporation tax it would owe on property held directly. A stamp duty exemption running from 2028 until at least the end of 2030 will let sovereigns move property into the new structures without a tax bill. Property they already own will also be revalued as of 1 January 2029, so they’ll only pay tax on gains made after that date.

The timing is awkward: Officials are already worried that relations with the UAE could suffer over the penalty Manchester City may face for breaking Premier League financial rules. The previous Conservative government dropped a similar plan in 2023 for fear of putting off foreign investors. The UK’s independent budget watchdog has called the revenue forecast highly uncertain, partly because it’s unclear how sovereigns will restructure to reduce the bill.

What’s next: The consultation closes on 20 January 2027. Draft legislation will follow, with final rules due in the 2027/28 Finance Bill.

MARKETS THIS MORNING-

Asian markets are mostly in the red this morning as weak US tech earnings revived worries about the AI trade. South Korea’s Kospi was down more than 5%, dragged by SK Hynix (-6.4%) and Samsung Electronics (-3.5%), while Japan’s Nikkei fell 2.6%. Mainland China’s CSI 300 slipped 1.2%, while Hong Kong’s Hang Seng (+0.7%) bucked the trend. Over on Wall Street, Nasdaq futures fell 1.7% after Amazon and Intel slid in after-hours trading. That followed a 12% drop in Alphabet’s shares during Thursday’s session, which pulled the Nasdaq Composite down 1.4%

ADX	9,478	-1.2% (YTD: -5.2%)
DFM	5,818	-0.5% (YTD: -3.8%)
Nasdaq Dubai UAE20	4,788	-1.1% (YTD: -2.1%)
USD : AED CBUAE	Buy 3.67	Sell 3.67
EIBOR	3.7% o/n	5.0% 1 yr
TASI	9,922	-1% (YTD: -5.4%)
EGX30	49,596	+0.6% (YTD: +18.6%)
S&P 500	7,720	-0.3% (YTD: -12.8%)
FTSE 100	10,722	+0.3% (YTD: +8%)
Euro Stoxx 50	6,207	+0.6% (YTD: +7.2%)
Brent crude	USD 117.15	+2%
Natural gas (Nymex)	USD 2.90	-1.7%
Gold	USD 4,012	-0.5%
BTC	USD 78,728	-3.3% (YTD: -11.3%)
Lunate JP Morgan UAE Bond UCITS ETF	AED 3.53	0.0% (YTD: -1.6%)
S&P MENA Bond & Sukuk	148.77	+0.4% (YTD: -2.1%)
VIX (Volatility Index)	17.20	+1.7% (YTD: +15.1%)

THE CLOSING BELL-

The DFM fell 0.5% yesterday on turnover of AED 620.1 mn. The index is down 3.8% YTD.

In the green: Watania International Holding (+2.5%), Amanat Holdings (+2.2%), and Al Firdous Holdings (+1.5%).

In the red: Air Arabia (-4.9%), GFH Bank (-4.4%), Ekttitab Holding Company (-3.2%).

Over on the ADX, the index fell 0.2% on turnover of AED 851.1 mn. Meanwhile, Nasdaq Dubai was down 1.1%.

How a 15-day holiday became a life in the Gulf for MRI Software’s Schalk Vorster

Schalk Vorster (LinkedIn) went to Bahrain for a 15-day holiday to see a girl. The girl became his wife, and the holiday turned into a life in the Middle East. The South African-trained architect now runs MRI Software’s regional business, pivoting from designing buildings to selling the technology used to run them once they’re built.

MRI provides software for managing real estate and its day-to-day operations, including maintenance and energy management. Vorster oversees its Middle East sales and operations. Clients increasingly want to know what AI can do for them — but his starting point is whether their data is good enough to use it.

Each week, My Morning Routine looks at how a successful member of the community starts their day — and then throws in a couple of random business questions just for fun. This week, we spoke with Vorster about helping property businesses make sense of AI and finding a daily rhythm around family life and regional travel. Edited excerpts from our conversation:

EnterpriseAM: How did you find your way from architecture into real estate software?

Schalk Vorster (SV): I came over to the Middle East in my twenties chasing a girl, to be honest. That girl today is my wife and the mother of my child. By trade, I’m an architect; I finished my degree in architecture in South Africa. The initial plan was to stay on holiday for 15 days. I enjoyed the region so much that I decided to stay for a year, do a little bit of work, and then go back. I’m still here.

I spent two years in architecture in Bahrain, then moved into technology for construction. I joined a company in Abu Dhabi offering building information modeling solutions to the construction industry. From there, I was headhunted by FSI, a UK-based organization, to support the transition from construction into the operational phase.

In 2021, FSI was acquired by MRI Software. That gave me access to a lot more tools and solutions, and I started bringing real estate software used globally into the Middle East. From there, I moved into sales leadership and made my way up. Now I’m heading the business here.

E: What was the biggest turning point in that move?

SV: Taking the leap. Moving from construction to the operational sector meant learning a whole new set of technologies beyond my education. It took me 13 months to close my first deal with FSI. Following that, I closed 12 more. As an individual contributor to a sales team, that was a real W. It gave me confidence I was pretty good at this.

E: What does MRI Software do, and what does running its Middle East business involve?

SV: Our main sector is real estate, but that extends into maintenance, energy, footfall analytics, digital twins, and smart buildings. Whether it’s commercial, residential, owner-occupied, or retail property, we have solutions that support organizations in their day-to-day needs. The software becomes their operational backbone. We’ve also got something we refer to as MRI Agora, which gives you an intelligence and an orchestration layer above that.

My role covers both operations and sales. It’s removing blockers so the teams here have the tools and support to look after clients. I also block out time during the week with sales representatives to align on strategic deals and support clients who have been with us for years.

E: What needs to be in place for AI to be useful — and what’s holding companies back?

SV: Companies need a solid foundation for where their data resides. They need to have spent the time making sure that data is accurate and the quality is good enough to report on. AI will be a driver; it’s not going to fix broken processes within an organization.

The challenge is that AI is so new and moving so quickly. When is the right time to invest? What is the right strategy? There are so many different avenues. Clients also want to understand where their data is flowing. If an AI model needs to process it, does that happen in the US, in Europe, or within the country? Those are valid questions. The biggest ones coming up are what it will cost and what security protocols are in place to keep the data safe.

E: Tell us about your morning routine. How does your day begin?

SV: I have a two-year-old, so I’m up very early: my day starts just before 6am. I have two cups of coffee, get her ready for nursery, and drop her off. When I get back, I walk over to the gym for a 45-minute workout. I try to make sure I get my exercise in, regardless of what it is. It helps me have a clear mind and manage stress levels. When I’m in the gym, I check my schedule and start planning.

Funny enough, I use AI to prioritize my day — what requires attention immediately, and what are the top three priorities? On the walk back, I create my to-do list. Since I was a student, I’ve had 10 items on my daily list, even if some roll over. That has kept me honest about being as productive as possible. The list might cover meetings, escalations, or where I can help my team remove blockers.

Then it’s back home for a shower and breakfast, and onto laptop to work through emails and Teams messages before heading out to the office or meetings. Travel also has to come into consideration. I live in Ras Al Khaimah but travel frequently across the region — to Dubai, Abu Dhabi, Riyadh, Doha, or Muscat — depending on where I’m needed and where I can support the team.

E: How do you switch off outside work?

SV: I like the outdoors, but I don’t like doing anything by myself. I drag my family everywhere I go. On weekends, I’m in the desert or out on the ocean. When summer kicks in, I try to be as adventurous as I can and see the world with my family and friends.

I do try to step away from work on weekends, although sometimes you have to juggle expectations. I try to keep a happy, healthy work-life balance, but sometimes the two bleed into one another.

Schalk’s favorites

A regular escape: I travel to Bali very often. I enjoy a bit of surfing, so I tend to go there for summer and school holidays.

What he reads: Books on personal and strategic investment. It’s something I’ve been doing for years. That material has helped me understand how to manage my finances personally, and I apply it in my professional life as well.

Best advice he’s received: Don’t shy away from hard work. You need to be smart in your approach, but hard work does pay off. Consistency and persistence opened the doors I needed to progress in my career. In sales, you have to keep driving a deal toward a final decision rather than leaving loose ends.

CALENDAR

OCTOBER

27 October-3 November (Tuesday-Tuesday): DIP Holding IPO subscription period.

30 October (Friday): Large businesses achieving annual revenues equal to or above AED 50 mn must appoint an accredited service provider for e-invoicing implementation.

NOVEMBER

2-5 November (Monday-Thursday): Adipec, Adnec Center, Abu Dhabi.

2-6 November (Monday-Friday): Dubai Future Finance Week, Dubai.

4 November (Wednesday): DIP Holding final offer price announcement.

4 November (Wednesday): Digital Transformation Summit, Sofitel, Abu Dhabi.

4-16 November (Wednesday-Monday): ADIB rights trading period.

9-10 November (Monday-Tuesday): Annual government meetings, Abu Dhabi.

9-12 November (Monday-Thursday): EMEA Council on Hotel, Restaurant and Institutional Education Conference, Dubai College of Tourism, Dubai.

9-13 November (Monday-Friday): World Congress of Military Med, Adnec Center, Abu Dhabi.

10-12 November (Tuesday-Thursday): Dubai International Electric Vehicle Exhibition & Conference, Dubai World Trade Center.

10-24 November (Tuesday-Tuesday): ADIB rights issue subscription period.

11 November (Wednesday): DIP Holding expected to begin trading on the DFM.

16-17 November (Monday-Tuesday): The Mining Show, Dubai World Trade Center, Dubai.

16-18 November (Monday-Wednesday): World Police Summit, Dubai World Trade Center, Dubai.

17-18 November (Tuesday-Wednesday): Data Center World Middle East, Dusit Thani Hotel, Abu Dhabi.

18-19 November (Wednesday-Thursday): Touchdown Middle East 2026, Conrad Abu Dhabi Etihad Towers, Abu Dhabi.

19 November (Thursday): Middle East Defense Conference, Rabdan Academy Headquarters, Abu Dhabi.

23-26 November (Monday-Sunday): Big 5 Global, Dubai World Trade Center, Dubai.

25-26 November (Saturday-Sunday): Doers Summit, Dubai Silicon Oasis, Dubai.

DECEMBER

2-4 December (Wednesday-Friday): UN Water Conference, UAE.

4-6 December (Friday-Sunday): Formula 1 Abu Dhabi Grand Prix, Abu Dhabi.

8-9 December (Tuesday-Wednesday): Capital Market Summit, Madinat Jumeirah, Dubai.

8-9 December (Tuesday-Wednesday): Federal Open Market Committee (FOMC) meeting.

7-10 December (Monday-Thursday): Abu Dhabi Finance Week, Al Maryah Island, Abu Dhabi.

8-10 December (Tuesday-Thursday): Abu Dhabi Water & Power Week, Adnec Center, Abu Dhabi.

8-10 December (Tuesday-Thursday): Middle East & North Africa Business Aviation Association Show, DWC, Dubai Airshow Site.

Signposted to happen sometime in 2027:

1 January: Deadline for large businesses to implement e-invoicing;
14-17 January (Thursday-Sunday): MOC27 Motor, Outdoor & Camping Festival, Dubai Sevens Stadium, Dubai.
1Q 2027: Completion of the first phase of Hassyan seawater desalination project;
1-3 February (Monday-Wednesday): World Governments Summit;
31 March: Small businesses with annual revenues of less than AED 50 mn are obliged to contract with an accredited service provider for e-invoicing implementation;
31 March: Government entities are required to appoint an accredited service provider for e-invoicing implementation;
21-22 April (Wednesday-Thursday): Token2049, Dubai;
11-13 May (Tuesday-Thursday): Middle East Energy, Expo City, Dubai.
31 May-2 June (Monday-Wednesday): RailX Dubai, Dubai World Trade Center, Dubai.
1 July: Deadline for small businesses to implement e-invoicing;
1 October: Deadline for governments to implement e-invoicing;
November: HR Tech, Abu Dhabi.
Abu Dhabi’s solar and battery energy facility, combining 5.2 GW of solar capacity and 19 GWh of battery storage, is set for commissioning.

Signposted to happen sometime in 2028:

Artificial Intelligence Summit.

Signposted to happen sometime in 2029:

Sibos 2029 organized by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), Dubai;
Annual Meetings of the World Bank Group and the International Monetary Fund, Abu Dhabi;
The commissioning of the seventh phase of Mohammed bin Rashid Al Maktoum Solar Park.

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