Bringing new vitality to Oman’s real estate market, Jasser al Aulaqi, the CEO of Shumookh Fund Management LLC, announced the launch of the RO 65.48 million Oman REIT Fund (Under Formation), one of the largest real estate investment funds in the Sultanate. The fund’s RO 26.1 million Initial Public Offering (IPO), representing 40 per cent of the total fund, of which the issuer can accept up to 39.2 million, representing 60 per cent of total fund, is available for subscription from today, January 17, 2021 to January 31, 2021.
Shumookh Fund Management LLC is the sponsor and investment manager of the Fund while United Securities LLC is the issue Manager, handling the public offer.
“Oman REIT Fund offers an investment opportunity to the investors to participate in Oman’s high potential real estate market by allowing them access to a diversified portfolio of real estate assets located at strategic locations across the Sultanate,” Al Aulaqi said at a press conference on Thursday.
“Oman REIT Fund could be a game changer in Oman’s real estate sector. The Fund presents investors with multiple benefits including stable and high income, hedge against inflation and high liquidity along with professional management of their wealth by a team of investment experts,” he pointed out, adding, “The Fund aims to pay an annual dividend of 7.5 per cent per annum in the first year, which can grow up to 8.2 per cent per annum during the fifth year.”
The close-ended Oman REIT Fund will be listed on the Muscat Stock Exchange for secondary market trading upon closure of the IPO.
The Capital Market Authority (CMA) has already given the necessary approval for the fund to open to the public, Al Aulaqi stated.
Oman REIT Fund has its assets distributed across sectors in such a way as to ensure higher and steady returns, Al Aulaqi noted, saying, residential cum commercial properties represent half of the fund’s allocation, followed by office and retail assets at 30 per cent and 14 per cent, respectively.
Logistics and industry properties make up the rest.
“Oman REIT Fund is arguably the largest REIT in the Sultanate with the total appraised value of properties pegged at RO 65.48 million.
“It has a diverse portfolio of as many as 20 high-worth individual property assets spread across the capital area including Ruwi, Madinat Al Sultan Qaboos, Qurum, Al Khuwair, Ghala, Rusayl and Misfah, with a strategic mix of residential and commercial, retail, office and industrial as well as logistics properties. The ranking of the Fund is expected to be on top among its peers upon listing on the MSM, in terms of market cap,” he continued.
According to Tariq Abdelrazeq, Deputy General Manager of United Securities, the current offering consists of 261,903,576 units with the right to accept up to 60 per cent of the offer, and each unit is priced at RO 0.102 (unit price RO 0.100 and 2 baisa towards issue expenses).
Oman REIT Fund promises strong growth potential supported by a diversified, high-value asset portfolio, he said, adding, the Fund offers a simple and affordable means to invest in Oman’s high value real estate sector without buying property directly and to enjoy long-term capital appreciation and reliable income that grows at an estimated rate of 7.5 per cent to 8.2 per cent over a period of 5 years.
Investors can subscribe to the IPO for as low as RO 102 and going up to a maximum of RO 16.37 million in a single application which is for 163,689,735 units (25 per cent of the issued units).
Elaborating on the types of investments the Fund offers, Abdelrazeq said investors can choose category I or category II depending on the investment size and status. Category I has minimum and maximum application sizes of 1,000 and 10,000,000 units respectively while the minimum and maximum application sizes for category II investors stand at 10,000,100 and 163,689,735 units respectively.
Oman Observer is now on the WhatsApp channel. Click here
