Apollo Global Management (Apollo), through its managed investment vehicle, is a subsidiary of Abu Dhabi-listed Aldar Properties and holds an 11.1% minority stake in Aldar Investment Properties (AIP), the region’s largest institutional real estate platform.
The acquisition is part of the previously announced $1.4bn investment by Apollo into Aldar’s transformational growth initiatives.
The transaction involved the issuance of $400m of common equity and mandatory convertible preferred equity at 100 per cent of net asset value into AIP, which houses Aldar’s core asset management business comprising over Dhs23bn ($6.3bn) of prime real estate assets across retail, residential, commercial, and logistics segments.
The diversified portfolio has proven highly resilient through business cycles, with occupancy standing at 92 per cent as of June 30.
The transaction is a catalyst for AIP to significantly scale up its real estate platform through further acquisitions. The company has been expanding rapidly this year and in July announced the landmark acquisition of four prime Grade A commercial towers in Abu Dhabi Global Market, Abu Dhabi’s financial centre, for Dhs4.3bn ($1.2bn).
Talal Al Dhiyebi, Group CEO at Aldar Properties, commented: “We welcome Apollo as strategic investors in Aldar Investment Properties at a time when we are building significant scale, diversification, and synergies across the region’s premium platform for property ownership.”
Apollo co-president Scott Kleinman, said, “This transaction provides Apollo with exposure to prime institutional real estate in the UAE through a high-quality platform. We are excited by Aldar’s strategy for continued growth, the team’s strong asset management credentials, and the prospects for significant value creation. Apollo has confidence in the UAE’s increasingly dynamic investment landscape and the robust economic fundamentals that underpin it.”
The completion of the equity transaction follows the issuance by AIP in March 2022 of $500m in subordinated perpetual notes to Apollo priced at a coupon of 5.625 percent.
As part of its transformative growth strategy, Aldar has deployed and committed over AED 11 billion (USD 3 billion) of capital this year, including recurring assets of over AED 7 billion (USD 1.9 billion).
