Q1 2018 Net Profit Up 4% To AED 668 Million
Strategic partnership announced with Emaar for iconic UAE developments
Launch of two new developments, Reflection and Alghadeer
Abu Dhabi, UAE, 15 May 2018: Aldar Properties PJSC ("the Company"), announced it delivered a net profit of AED 668 million for the first quarter of 2018, up 4% from Q1 2017 (AED 641 million), reflecting a strong start to the year.
Q1 2018 highlights:Revenue of AED 1.5 billion driven by strong revenue recognition on developments under constructionGross profit of AED 715 millionDevelopment sales of AED 681 millionPartnership announced between Aldar and Emaar to develop iconic destinationsAnsam and Al Hadeel handovers completeCommenced handover of Nareel Island and Al Merief land plotsLaunch of Reflection, a residential development on Reem IslandAwarded AED 1.3 billion construction contract for Water's EdgeAsset Management business delivered steady net operating income of AED 396 million demonstrating portfolio resilience
Post period highlights: Announced AED 3.7 billion acquisition of assets from Tourism Development & Investment Company (TDIC) providing growth for both the development and asset management businessLaunch of expanded Alghadeer community on the border of Abu Dhabi and Dubai and sale of school and retail outlet plots
Commenting on the results, Talal Al Dhiyebi, Chief Executive Officer of Aldar Properties, said:
"Aldar started 2018 strongly with the announcement of an historic partnership with Emaar to develop the next era of iconic real estate destinations. The initial AED 30 billion pipeline of projects, including Saadiyat Grove in Abu Dhabi and Emaar Beachfront in Dubai, is just the start of this partnership, which will enhance our country's reputation as a destination of choice for residents and tourists alike. Our launch of a boutique development on Reem Island - Reflection – shows the continued momentum in our development business, which recorded sales of AED 681 million during the quarter, while our asset management business also continued to deliver a resilient performance."
"Our acquisition of AED 3.7 billion of assets from TDIC last week, including a portfolio of assets in the prime Saadiyat Island destination, as well as the launch of Alghadeer in April, cements our reputation as Abu Dhabi's leading real estate developer and asset manager and underlines the scale of our ambitious plans for future growth."
Operational Highlights - Development
Development sales for the quarter were AED 681 million, driven by sales of existing developments under construction, with over 80% of all projects under development sold as at 31 March 2018. At the end of the quarter, Aldar launched Reflection, a boutique development on Reem Island, consisting of 374 units and offering investors and owner occupiers the opportunity to secure high quality homes in a prime location.
Aside from off-plan launches, construction is progressing well at all key developments under construction. Handovers at Ansam and Al Hadeel, which commenced in Q4 2017, are complete. Handovers have now commenced on Al Merief and Nareel Island, as planned. West Yas, Aldar's first villa community on Yas Island is entering the final stages of construction and will be handed over in Q2 2018. During the quarter, Aldar awarded AED 1.3 billion in construction contracts in respect to the 2,255 unit Water's Edge development on Yas Island.
In April, Aldar launched a multi-use development on the border of Abu Dhabi and Dubai, enhancing its established destination at its Seih Al Sdeirah landbank, Alghadeer. Launched ahead of Cityscape Abu Dhabi, the Alghadeer community will be complemented by office and retail space as well as hospitality, education and community amenities, in line with Aldar's strategy to create complete communities. Aldar has already sold two of the land plots for community services including a school and retail outlets.
Operational Highlights - Asset Management
Aldar's asset management portfolio of residential, retail, office and hospitality properties delivered a resilient performance during the first quarter of 2018, recording net operating income of AED 396 million.
Occupancy was healthy across the portfolio. Residential occupancy increased to 92%, while occupancy at the expanded office portfolio, including International Tower acquired by Aldar in December, was 91% and Yas Mall was 89%. The hospitality portfolio recorded occupancy of 85%.
Emaar strategic partnership
Further cementing the UAE's reputation as a global real estate leader, Aldar and Emaar announced a strategy partnership in March to develop iconic destinations with an initial focus on two projects with an AED 30 billion gross development value pipeline. The JV will draw on the proven capabilities of the UAE's leading developers to deliver quality master-planned communities starting with Saadiyat Grove in the heart of Abu Dhabi's cultural district and Emaar Beachfront on a private island between Jumeirah Beach Residences and Palm Jumeirah in Dubai.
TDIC asset acquisition
Post period, Aldar announced the acquisition of a diverse portfolio of assets from TDIC for AED 3.7 billion. The portfolio, which includes operating assets, as well as a selection of prime strategic land and projects under development, will further strengthens Aldar's position as the leading developer and real estate asset manager in Abu Dhabi and provide an unprecedented opportunity to accelerate growth.