Deyaar Development, the Dubai-listed real estate firm, expects its second half revenues and profit to improve "slightly" from the first six months of 2017, as the firm continues to focus on generating income from its operations, its chief executive Saeed Al Qatami said on Monday.
“We will continue in the same trend. We might be slightly better in terms of revenues than the first half [of 2017], Mr Al Qatami told The National at Cityscape Global in Dubai, where Deyaar unveiled its Dh1 billion South Bay residential development in Business Bay.
Mr Al Qatami said the company's bottom line estimates for the last six months of the year are also higher, but “very slightly”.
Deyaar reported a year-on-year jump of 135 per cent in revenues to Dh316.4 million for the first half of the year, driven by sales and progress on under construction properties. However, profit for the period declined to Dh67m from Dh111.3m in the same period of 2016.
“There was one thing that was evident from our numbers [first-half bottom line], as this time we have made sure that our profit was purely coming from our own operations,” Mr Al Qatami said, adding that this will be the company’s strategy for the remainder of the year.
The firm plans to put 20 per cent of its own equity into funding the construction of the South Bay development. The remaining funding for the project will be secured via a combination of revenues and bank debt, Mr Al Qatami said, without specifying how much money the firm intends to borrow from lenders.
“We have been very shy in terms of borrowing in the past few years and we have been able, over the last 12 months, to raise funds mainly through our recurring income,” he said, noting that the land for the development has already been fully paid for.
South Bay will be Deyaar’s first project with three accommodation components: residential, serviced apartment, and hotel units. It will comprise 926 units, from studios through to three-bedroom apartments.
The hotel apartments and serviced apartments represent 478 of the more than 2,000 keys that Deyaar plans to add to the hospitality sector in Dubai by 2020.