Equitativa (Dubai) Limited, the manager of Emirates REIT PLC, announced on Tuesday a 16 per cent rise in net property income, reaching $34 million for the first half of 2024. This increase was driven by higher occupancy rates and improved lease rates, bolstered by Dubai’s thriving commercial property market, leading to a 12 per cent year-on-year growth in total property income to $40 million for H1 2024 (H1 2023: $36 million). Simultaneously, ongoing cost optimization efforts reduced property operating expenses by three per cent to $6 million (H1 2023: $6.2 million), contributing to a 19 per cent increase in operating profit to $25 million (H1 2023: $21 million) for the first half of the year.
Despite these achievements, the REIT faces persistent challenges from escalating finance costs, which dampened the impact of its robust operating performance and resulted in a negative funds from operations (FFO) of $1.5 million in H1 2024, an improvement from the negative $3.6 million FFO reported in H1 2023. The fair value of investment properties, influenced by sustained valuation improvements, rose by 18 per cent year-on-year to $991 million, aiding in lowering the financing to assets value (“FTV”) to 40 per cent as of 30 June 2024, the lowest since 2016. The unrealised gain on revaluation of investment properties for H1 2024 stood at $65 million (H1 2023: $50 million), underscoring the portfolio’s strong performance in a robust real estate market.
Thierry Delvaux, CEO of Equitativa Dubai, commented: “These results underscore the significant strides we are making in achieving our strategic objectives and enhancing returns for our stakeholders. We have markedly enhanced operational performance through increased occupancy and rate hikes, and remain committed to efficient cost management, with a particular emphasis on finalizing our refinancing plan to fortify our financial stance.”
