Private lending is going strong despite regional tensions, with Aldar raising AED 5 bn from banks

Abu Dhabi developer Aldar raised AED 5 bn from banks: ADX-listed developer Aldar Properties secured a AED 5 bn sustainability-linked revolving credit facility, marking one of the largest corporate debt facilities to close in the GCC since the outbreak of the Iran war, it said in a bourse filing (pdf).

Started early, but stayed on track: Bookbuilding kicked off in February and “progressed in line with the original plan,” Group Chief Financial and Sustainability Officer Faisal Falaknaz said in the statement, defying a two-month period of extreme market jitters.

Details: The five-year senior unsecured loan consists of AED, USD, and shariah-compliant tranches, marking Aldar’s return to bank funding post-ceasefire. The latest facility brings the developer’s total liquidity to AED 38.2 bn, including a massive cashpile of AED 13.9 bn.

IN CONTEXT- While parts of the real estate credit stack tipped into distress last month, Aldar remained largely insulated, likely due to its solid liquidity and outlook. Aldar’s links to the Abu Dhabi government, which plays a big role in supporting its Baa2 rating, also underpinned its resilience.

It wasn’t the only one to close in the past couple of months: Emirates NBD also locked in a USD 2.5 bn syndicated loan from banks across Europe, the US, and Asia earlier in March.

BACKGROUND- The developer already tapped the debt markets a couple of times this year. It raised a USD 1 bn hybrid debt issuance in January and another USD 1 bn in February to buy back USD 500 mn in older perpetual notes held by Apollo in Aldar’s investment arm, Aldar Investment Properties.

A good mix of local, regional and Asian institutions: The latest facility drew interest from 10 local, regional and international names, including Abu Dhabi Commercial Bank, Al Ahli Bank of Kuwait, Arab Bank for Investment and Foreign Trade (Al Masraf), Commercial Bank of Dubai, Dubai Islamic Bank, Emirates Islamic, Emirates NBD Bank, First Abu Dhabi Bank, Industrial and Commercial Bank of China, and Sumitomo Mitsui Banking Corporation.