Aldar Properties and Apollo Global Management (Apollo), one of the world’s largest alternative investment managers, have signed a historic agreement in which Apollo-managed funds and clients will invest a total of US$1.4 billion in strategic capital to drive Aldar’s transformational growth initiatives.
The commitments are structured as follows: a US$500 million land joint venture investment; a US$500 million perpetual Subordinated Notes issued by Aldar Investment Properties investment; a US$300 million Mandatory Convertible Preferred Equity investment in Aldar Investment Properties; and a US$100 million Common Equity investment in Aldar Investment Properties.
The US$500 million land joint venture will enable Aldar to realize long-term value tied up in its vast landbank while retaining the flexibility to develop or sell the land in accordance with Aldar’s long-term development strategy.
As part of the agreement, Apollo will acquire a direct minority stake in Aldar Investment Properties at its Net Asset Value, highlighting the underlying strength of the company’s asset base and Apollo’s belief in the company’s growth strategy, management capabilities, and ability to capitalize on future accretive opportunities.
Moody’s has assigned Aldar Investment Properties a Baa1 credit rating, the highest in the region for a non-government corporation.
This investment demonstrates Aldar Investment Properties’ and Aldar Group’s ability to attract institutional capital into their real estate platforms.
“This landmark transaction is a signal to the world’s investment community that Abu Dhabi’s real estate market is on a growth trajectory, supported by significant economic and social reforms, and a world-leading response to COVID-19,” said Talal Al Dhiyebi, Group Chief Executive Officer at Aldar Properties.
“Aldar’s ability to attract a long-term partner like Apollo highlights the strength of Aldar’s business franchise as well as the quality and investment appeal of the Abu Dhabi real estate market, both of which are driven by robust fundamentals underpinning long-term economic growth.”