ENBD REIT (CEIC) PLC (ENBD REIT), a Shariah-compliant real estate investment trust managed by Emirates NBD Asset Management Limited, announced its net asset value (NAV) as of September 30, 2022, reflecting continued improvement to $172 million from $166 million in the previous quarter and $164 million as of September 30, 2021 ($0.69 per share).

As the real estate market experienced strong growth and continued momentum in leasing activity, occupancy across the portfolio improved to 84% from 75% at this time last year, which increased the property portfolio value by $4.7 million to $362 million compared to the previous quarter.

Anthony Taylor, Head of Real Estate, NBD Asset Management, UAE, said." We are pleased to announce a strong performance across the portfolio in the first half of the year, building on the positive trajectory started in the first quarter. Occupancy rates and gross income continue to rise, driving an upward trend in portfolio valuations across all sectors.

In the booming Dubai real estate market, we will maintain a prudent risk management strategy and a prudent capital management approach to ensure that we continue to deliver reliable returns to our shareholders, particularly in a rising interest rate environment, which will offset some of the positive performance of our business in the coming quarters. As previously mentioned, we will also consider any attractive exit opportunities to ensure the optimal allocation of properties in our portfolio."

ENBD REIT achieved strong gross rental income of $15 million, up 0.7% from a year ago, as occupancy improved despite the renegotiation of Uninest's leases during the Covid-19 pandemic.

The portfolio's weighted average unexpired lease term (WAULT) was 4.13 years and the loan-to-value (LTV) ratio remained stable at 54%.

Operating expenses increased only 2.2% compared to the same period last year as ENBD REIT continued to invest in the maintenance and modernization of assets to drive occupancy across the portfolio.

Fund expenses increased 3.7% year-over-year, in line with changes in valuations. In addition, finance costs were up 5.5% year-over-year, primarily due to inflation and rising interest rates as a result of the challenging global macroeconomic environment.

Taking a prudent approach to maintain flexibility in a rising interest rate environment, the management team recommended to the Board of Directors an interim dividend of $4.5 million or $0.018 per share, in line with the first half of last year, which is derived from net rental income.

Shares will be ex-dividend on December 6, 2022, with a payment date set for December 21, 2022.