The Pearl REIF — Cyborg Score 7/10

Solid
Real Estate Investment Funds / Islamic Finance

Strategic Profile

The fund has a total asset value of OMR 90,641,000 (approximately USD 235 million) and is Oman's largest and first REIF that avails the Islamic Ijara financial facility. At initiation, the fund has two marquee tenants: Omantel (which has confirmed a definitive agreement for the sale and leaseback of its iconic headquarters building) and Lulu Hypermarket Salalah (with a long-term lease agreement).

Cyborg Score Rationale

The fund is backed by two of Oman's largest institutions: Oman Investment Authority and Omantel. The Pearl REIF has projected an Average Distributable Profit Yield of 9.2 percent, which is attractive. However, as a newly listed fund with limited operational history, it carries execution and market risks.

Top Insights

  • The Fund expects to distribute at least 90% of its distributable profits to unitholders
  • The Pearl REIF was listed on Muscat Stock Exchange in November 2022 under ticker PRFD, with the IPO being the largest in Oman's market in seven years, attracting subscription demand of over RO35 million against issue size of RO23.3 million
  • Sohar International Bank is providing financial advisory, investment management and placement services
  • The IPO democratizes real estate investment access that was historically attractive only to large investors due to size and scale

Named Competitors

  • Aman REIT — Oman's first Real Estate Investment Trust, launched 2020
  • Oman REIT — Real estate fund covering residential, commercial, retail and warehousing properties

Recent Developments

  • (November 2022) Listed on Muscat Stock Exchange under ticker PRFD
  • (November 2022) IPO attracted overwhelming subscription of RO35 million against issue size of RO23.3 million
  • (October 2022) Fund formation announced with approval from Capital Market Authority

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