The developer behind Dubai’s palm islands enjoys record profits
The developer behind Dubai’s palm islands enjoys record profits
A clean slate for the formerly debt-ridden property giant
Nakheel, the real estate behemoth responsible for the palm-shaped islands dotting the Persian Gulf, announced yesterday its record takings in 2016.
Net profits for Nakheel reached AED4.96 billion (USD1.35 billion) last year, the highest ever for the Dubai-based developer. This marks an increase of 13 percent over the AED4.38 billion (USD1.19 billion) in profits posted by the company in 2015.
Nakheel also reduced a debt pile that had accumulated from Islamic sukuk bonds, with the company paying off its final trade creditor sukuk bond in August. The repayment put an end to a five-year restructuring process that saw the government of Dubai taking over Nakheel from its beleaguered parent company Dubai World.
More: Dubai home purchases plummet to five-year low
“2016 was a momentous year in which we met and completed all of our restructuring obligations by repaying all AED4.3 billion of the trade creditors sukuk from our own resources – and recorded our highest-ever net profit since Nakheel’s inception,” said Ali Rashid Lootah, Nakheel’s chairman.
Nakheel’s profits took off partly on the strength of its 18,000-unit residential leasing business. Occupancy rates for its residential leasing portolio have hovered at “almost 100 per cent,” the company reported.
Property handovers from Nakheel totalled more than 1,426 homes and land parcels last year, up 40 percent from 2015. Most of these properties were situated in Palm Jumeirah, Jumeirah Park, Al Furjan, and International City.
Read next: Heart shaped island in Dubai to be the next big honeymoon destination
Source: Property Report