Dubai Holding has successfully raised AED 2.14 billion through the initial public offering of its Dubai Residential REIT, marking the largest real estate investment trust listing in the Gulf Cooperation Council to date. The offering, priced at AED 1.10 per unit, attracted substantial investor interest, with total demand exceeding AED 56 billion, leading to an oversubscription rate of 26 times.
Originally set to offer 12.5% of the REIT’s total issued unit capital, Dubai Holding increased the offering to 15% in response to the overwhelming demand. This adjustment brings the total number of units offered to 1.95 billion, implying a market capitalisation of AED 14.3 billion at the time of listing. The final offer price suggests a gross dividend yield of 7.7% for the year 2025, highlighting the REIT’s potential to deliver attractive returns to investors.
The Dubai Residential REIT stands out as the GCC’s first pure-play listed residential leasing-focused REIT and is set to become the region’s largest listed REIT upon its debut on the Dubai Financial Market , scheduled around May 28, 2025. With a gross asset value of AED 21.63 billion, the REIT’s portfolio encompasses 35,700 residential units across 21 communities in Dubai, catering to various market segments including premium, community, affordable, and corporate housing.
The REIT’s tenant mix is well-balanced, comprising 57% individual tenants and 43% corporate tenants, ensuring stable and resilient operating margins. As of the end of 2024, the portfolio achieved an average occupancy rate of 97%, reflecting strong demand and effective asset management. The REIT’s properties are actively managed by experienced teams focused on tenant engagement, enhancing community value, and mitigating risks.
Dubai Holding’s strategic integration of Nakheel and Meydan’s residential portfolios has significantly bolstered the REIT’s scale and diversity. This consolidation has positioned the REIT as a benchmark for residential real estate in Dubai, accounting for approximately 6% of the city’s rental transactions and 3% of the total rental value as of December 2024.
The REIT intends to adopt a semi-annual dividend distribution policy, with payments scheduled for April and September each year, commencing in September 2025. For the financial year ending December 31, 2025, the REIT expects to distribute the higher of AED 1.1 billion or 80% of its profit before changes in the fair value of investment properties, subject to board approval.
The IPO’s success is indicative of the robust investor confidence in Dubai’s real estate market, which has experienced a post-pandemic boom driven by foreign investment and government-led residency reforms. Dubai Holding’s move to list the REIT aligns with the emirate’s broader strategy to deepen its capital markets and diversify its economic base.
Citi, Emirates NBD, and Morgan Stanley served as joint global coordinators and joint bookrunners for the IPO, underscoring the offering’s significance in the region’s financial landscape. The REIT’s Shariah compliance has been confirmed by both its own Shariah Supervision Committee and Emirates NBD Bank’s Internal Shariah Supervision Committee, broadening its appeal to a diverse investor base.
