Dubai Holding attracted US$15 billion ($19.34 billion) in orders for the US$584 million initial public offering of its residential real estate investment trust, the latest sign of investor interest in the city’s booming property market.
The investment firm owned by the emirate’s ruler boosted the size of the offer earlier this week and had demand for all shares within minutes of opening books on the deal. Dubai Residential REIT’s listing will be the city’s first IPO of the year.
The final price of the Dubai Residential REIT offering was set at 1.10 dirhams (39 cents) per unit, the top end of the marketed range, implying a market capitalization of US$3.9 billion, according to a statement.
The deal comes amid a period of sustained strength in Dubai’s housing market, with prices up as much as 70% over the past four years. The emirate has seen an influx of new residents since the coronavirus pandemic, lured by easy visas and low taxes, which has boosted demand for housing and offices.
But Dubai’s transformation into one of the world’s hottest property markets is also increasingly pricing out many buyers, leading to a revival of interest in real estate investment trusts — a rarity in the region. Some buyers are also turning to fractional ownership apps that require payments as low as US$136.
The size of the offering was increased on Monday to 1.95 billion units, up from 1.63 billion, citing strong international and local demand. That brings the free float to 15%, up from the originally planned 12.5%.
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Dubai Residential will be the Gulf Cooperation Council’s first listed residential leasing-focused entity of its kind, with a gross asset value of 21.6 billion dirhams — nearly double the combined total of the region’s five largest REITs, the firm said.
Emirates NBD Capital, Morgan Stanley and Citigroup Inc are joint global coordinators on the deal. Abu Dhabi Commercial Bank, Arqaam Capital and First Abu Dhabi Bank are joint bookrunners.
The listing joins a broader wave of IPO activity across the Middle East, as companies press ahead with public offerings despite global market jitters tied to US trade policy. In Saudi Arabia, an airline, a hospital operator and a cardboard manufacturer have also launched share sales in recent weeks.
