Emirates Reit considers delisting from Nasdaq Dubai

The board and the fund manager running the Reit say the current climate has affected its share price

Emirates Reit, which invests in Dubai's real estate sector is considering delisting from Nasdaq Dubai. Pawan Singh / The National

The board of Emriates Reit and its fund manager, Equitativa (Dubai), are weighing up a delisting from Nasdaq Dubai as part of a strategic review.

The board will consider all potential options, however, a return to operating as a private Reit seems in the “best interests” of the fund and its investors, it said in a regulatory filing to Nasdaq Dubai on Sunday.

“Over the past few months, it has become increasingly clear to the board of Emirates Reit that the advantages of remaining publicly listed are heavily outweighed by the disadvantages,” according to the regulatory filing.

The fund said the current climate has affected its share price, leading to a large gap between the stock price and its true value. Last month, the Reit declared a net asset value of $1.41 per share as of March 31, but its share price closed at just $0.15 on Sunday.

“This has been exacerbated by a cyclical downturn in the UAE real estate sector and a challenging operating environment,” Emirates Reit said in a statement.

A delisting from Nasdaq Dubai would allow Equitativa to focus efforts on its long-term strategy to improve returns for investors. It could consider a relisting at a later date, as part of longer-term plans, it said.

ENBD Reit, the real estate investment trust run by Emirates NBD Asset Management, earlier this year also considered delisting its shares from the Nasdaq Dubai. However, the proposal did not secure the necessary backing from shareholders.

The real estate market in Dubai is facing headwinds in the wake of the oil price slump and the Covid-19-driven economic slowdown. However, Damac Properties' chairman Hussain Sajwani said he expects the market to bounce back next year ahead of Dubai Expo 2020.