Page 157 - SOBHA REALTY PR REPORT - SEPTEMBER 2024

9/13/24, 1:24 PM Sobha Realty Adds $230M To Existing Sukuk Holdings
Stock Exchange and Nasdaq Dubai.

The "significant interest" in Sobha's sukuk led to a significant price tightening of 95 basis points,
which the developer said highlights strong demand from regional and international investors.

Approximately 25% of the interest came from global sources.

Sobha appointed several regional banks as joint global coordinators, lead managers, and book-

runners for the transaction, including the Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank,

Dubai Islamic Bank, Emirates NBD, Sharjah Islamic Bank, and Standard Chartered Bank.

Clifford Chance and Dentons served as legal counsel to Sobha, while Grant Thornton was the

auditor for the process.

Rating upgrades

S&P upgraded the rating of PNC Investments, the parent of Sobha, to BB from BB- in July, citing a

stable outlook. The upgrade came as PNC reported a 22% jump in off-plan pre-sales in the first half
of 2024 to $2.4 billion (AED 9 billion) amid favorable demand in Dubai's residential real estate

market.

S&P estimates PNC to hit an adjusted EBITDA of $408.4 million (AED 1.5 billion) in 2024 and

over $816.8 million (AED 3 billion) in 2025 as the company increasingly books revenue from its

$5.4 billion (AED 20 billion) backlog.

Reduced leverage and ample liquidity shield the company against a potential sector slowdown, S&P

said, as it expects the momentum in the residential real estate market in Dubai to decelerate from

2025 to 2026 when new supply hits the market, increasing the risk of oversupply.

Moody’s also upgraded in July the rating of Sobha’s $300 million senior unsecured sukuk, of which

$270 million remains outstanding, to Ba2 from Ba3 to reflect the contractual seniority of the sukuk
relative to the $272 million subordinated shareholder loan

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