Dubai Residential REIT Expands IPO to 15% Amid Investor Demand

Dubai Holding has announced an increase in the size of its Dubai Residential REIT initial public offering , raising the offering from 1.625 billion units to 1.95 billion units. This adjustment elevates the float from 12.5% to 15% of the REIT’s issued unit capital, reflecting heightened investor interest ahead of the subscription deadline on 20 May.

The revised offering is expected to generate up to 2.15 billion dirhams , positioning the REIT's valuation at around 14.3 billion dirhams . The unit price remains within the previously set range of 1.07 to 1.10 dirhams, with the final pricing to be determined through a book-building process concluding on 20 May. Trading on the Dubai Financial Market is anticipated to commence on or around 28 May under the ticker symbol “RESI”.

This IPO marks the first listing on the DFM since December and represents the United Arab Emirates' second IPO this year. It also introduces the Gulf Cooperation Council’s first pure-play residential leasing-focused real estate investment trust , underscoring Dubai Holding’s strategic initiative to diversify its investment offerings and attract a broader investor base.

The REIT's portfolio encompasses 35,700 residential units across 21 communities in Dubai, with a gross asset value exceeding 21.6 billion dirhams. The properties cater to various market segments, including premium, community, affordable, and corporate housing. In 2024, the portfolio achieved an average occupancy rate of 97% and a tenant retention rate of 87%, indicating robust demand and tenant satisfaction.

Dubai Residential REIT plans to adopt a semi-annual dividend distribution policy, with payments scheduled for April and September each year, starting from September 2025. The first two dividend payments are projected to total at least 1.1 billion dirhams or 80% of the profit before changes in property value, subject to board approval.

The IPO's joint global coordinators and bookrunners are Citigroup Global Markets Limited, Emirates NBD Capital PSC, and Morgan Stanley & Co. International plc. Additional joint bookrunners include Abu Dhabi Commercial Bank PJSC, Arqaam Capital Limited , and First Abu Dhabi Bank PJSC. Emirates NBD Bank PJSC has been appointed as the lead receiving bank.

The offering is structured in two tranches: the first tranche allocates 10% of the offer units to retail investors, while the second tranche allocates 90% to qualified institutional investors. The sole unitholder, DHAM Investments LLC, a subsidiary of Dubai Holding, will retain 85% of the REIT’s issued unit capital following the offering, assuming all units are sold.

The REIT has received Shariah compliance certification from both its internal Shariah Supervision Committee and the Internal Shariah Supervision Committee of Emirates NBD Bank, ensuring adherence to Islamic investment principles.