23 April 2019

Global successfully completes the sale of a property in Edinburgh achieving internal rate of return of 10%

The Real Estate Asset Management team has successfully completed the sale of a property in Edinburgh owned by its clients within the UK National Commercial Real Estate Program, achieving total return of 27.3%, internal rate of return of 10% of which the income element represented 8.14% per annum.

The property, acquired in April 2016, is a modern 3-storey flagship building constructed in November 2003 in very high specification, around a large landscaped courtyard, and high-quality finishes internally, with a net internal area of around 150,000 square feet and 314 car parking spaces. The entire property is leased out to the Scottish Ministers on a long-term lease and is fully occupied by three main departments under the Scottish Ministers’ banner: National Health Services of Scotland (NHS); Scottish Ambulance Service; and Health Improvement of Scotland.


Sulaiman Mohammed Al-Rubaie, Acting Chief Executive Officer commented, “This is another successful exit from an investment part of the UK National Commercial Real Estate Program achieving returns to clients in line with our expectations upon acquisition. The result achieved, especially as the holding period has bared the brunt of the Brexit uncertainty, supports our main objective to target acquisitions that are relatively insulated from the prevailing economic volatility.”


Abdulaziz Al Abdulrazaq, Senior Vice President of Wealth Management said, "We are delighted by this achievement which cements our commitment to deliver our promise to clients. When compared to the level of risk and the average return on real estate investments in general in light of BREXIT implications and current economic uncertainty, the returns are considered very competitive."


It is worth noting that the real estate asset Management team has successfully concluded exits from three properties generating an average IRR in excess of 10%. Currently, the real estate portfolio consists of six properties worth USD293mn, five properties in the UK and one property in Germany.

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