GFH to inject cash in stalled Bahrain development

GFH said that under the new agreement it would fund the completion of the 35,900-square metre upmarket housing and hotel project by injecting cash up to $50 million.

GFH Financial Group (GFH) has completed a debt-restructuring agreement with the developer of a long-delayed US$700 million project in Bahrain.

In a statement to the Dubai stock exchange yesterday, GFH said it had signed a final sukuk-restructuring agreement with Bahrain-based Gulf Holding Company (GHC), the developer of the Villamar project close to the Bahrain Financial Harbour complex and Al Rajhi Bank, the project’s original financier.

GFH said that under the new agreement it would fund the completion of the 35,900 square metre upmarket housing and hotel project by injecting cash up to $50m.

In August GHC said it was restarting work on the stalled project after it agreed a restructuring deal with support from Al Rajhi Bank, new funder GFH and the contractor, UAE-based Al Hamad Contracting.

The project comprises three twisting towers of 54, 52 and 43 storeys, which are to contain a hotel and apartments.

As a result of the agreement, GHC said cranes had been moved back on to the site to restart work and the project is now due for completion in the summer of 2018.

Villamar was initially launched in 2007, when GHC awarded a $380m construction contract to Sharjah-based Al Hamad Contracting.

Initially it was due for completion in the first quarter of 2010, but stopped midway through construction as the financial crisis caused projects to stall across the Arabian Gulf.

However, in February, Bahrain’s government announced that it had passed a law aimed at restarting many of the kingdom’s major stalled property projects, and in July the deputy premier, Sheikh Khalid Al Khalifa, who also heads Bahrain’s ministerial committee on reconstruction and infrastructure, held a meeting aimed at advancing Villamar’s future.

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