Qatar Real Estate News
Qatar government steps in to fund Barwa real estate projects
Qatar, last week, stepped in to offer fresh funds to the fifth-biggest developer in the Gulf Arab region, according to a deal financed by its parent, the real estate arm of QIA (Qatar Investment Authority).
The terms are yet to be determined, but the deal to support a unit of Barwa Real Estate, came when Qatari Diar Finance (QDF), appointed by Barclays, HSBC, Qatar National Bank, Standard Chartered and RBS aimed to raise $3.5bn worth funds, via dollar-denominated benchmark issue.
The QDF is an arm of Qatari Diar Real Estate Investment, a division of QIA, which holds a direct 45percent stake in Barwa.
Barwa has been hit hard by the real estate slump region-wide, just as is the case with other Gulf Arab developers.
Qatar is ensuring that its major real estate companies are able to ride through the global crisis by enforcing through defensive mergers, and utilizing the defensive mergers and using property arm of sovereign wealth fund for investments.
The latest deal signed last week will take the form of murabaha financing, said Ezabi, Chief Financial Officer at Barwa. In such a deal, an Islamic bank purchases an asset from the borrower and later sells it at a premium, thereby avoiding the interest payment, which is forbidden under sharia law.
Barwa, in its statement mentioned that Barwa City Real Estate Company will enter into Sharia financing arrangements with other Barwa subsidiaries when the financing from Qatari Diar is finalized.
Posted on 13/7/2010