Islamic lending banks' overwhelming interest in The Lagoon Bahrain
Bahrain’s much anticipated retail and leisure development on Amwaj Island, has experienced overwhelming interest from potential lenders.
Publication: menaREPORT - Industry News
Provider: Al Bawaba
Date: December 12, 2006 (09:12)
$90 million ‘The Lagoon’ was offered four times more debt than the required $20 million by a consortium of Islamic lending banks, with the company curtailing its borrowing to secure exceptional returns for investors.
The Lagoon Bahrain is currently financed with over $41 million of equity and over $32 million of debt from a bank consortium. The rest of the $90million is financed through pre-sales.
The normal process for debt subscriptions from the consortia of banks is for the Lead Arranger to approach the market in the search of loans. When Abu Dhabi Investment House’s went through this process last month, it was inundated with offers to provide finance for The Lagoon Bahrain.
Ali Mahmoud, Abu Dhabi Investment House’s executive director of investment, was surprised by the exceptional interest.
He said: “The level of interest is extremely unusual. In fact, I have never experienced such a high level of enthusiasm. “There are a number of reasons for this. The project grew from two levels, with a ground and first floor, to three with the addition of an extra floor. “Over the past six months the overall scheme has changed due to rolling re-designs providing a much improved layout for prospective buyers.