Abu Dhabi banks said tighten lending for real estate projects

Abu Dhabi banks are reportedly becoming more cautious about financing real estate projects overs concerns that the property market is slowing, according to a US-based developer.

Ken Himmel, chief executive officer of Ney York’s Related Urban, which is part of a joint venture building $1 billion shopping mall in the UAE capital made the comments in an interview with Bloomberg TV.

“Everyone is far more cautious about underwriting anything today. I don’t know how any commercial bank could rationally underwrite another project in Abu Dhabi, given the dynamics of the market, given what’s going on with supply and demand,” he was quoted as saying.

Gulf Related is building a shopping mall that will house the Gulf’s first Macy’s department store and is expected to open in August 2018.

Al Maryah Central will also include Bloomingdale’s, the Toy Store and British upmarket grocer Waitrose. Gulf Related said it has so far leased about 50 percent of the available space in the 2.8 million square feet shopping centre.

Gulf Related secured a $626 million loan from Abu Dhabi Commercial Bank a year ago to help finance the mall, with the rest of the money coming from the two companies and other investors, Bloomberg said.

Last year, Gulf Related signed a AED2.3 billion ($626.29 million) financing deal with Abu Dhabi Commercial Bank to fund the building of the mixed-use retail development.

Source: Arabian Business.com