Latest news with #Dubai‑based
Arabian Post
6 days ago
- Business
- Arabian Post
Palazzo Versace Dubai Heads to Auction with Dramatic Price Cut
Dubai's iconic Palazzo Versace Hotel is being offered at auction with an opening bid of approximately $163 million, a sharp reduction from its last estimated value above $380 million, signalling a major shift in the fortunes of the luxury hospitality landmark. A Swiss‑Italian financier, Christopher Aleo, is among a select group of potential buyers believed to be evaluating the purchase as online bidding gets underway. Union Properties, the Dubai‑based developer responsible for listing the property, confirmed that the hotel will be sold through a digital auction platform. Attracting bidders globally, the online sale marks the latest attempt by the firm to ease its heavy debt burden, which follows confirmed repayments of Dh179 million in the first quarter and a further Dh159 million expected before the end of June. Christopher Aleo, identified as a Swiss national of Italian descent and a longstanding resident in the UAE, has emerged as a key prospective buyer. Industry insiders report that Aleo, known for managing high‑value portfolios in the region, is closely evaluating the asset's hospitality credentials and return prospects. Other potential interest is said to include investment funds and private equity groups, though no official list of bidders has been disclosed. ADVERTISEMENT Palazzo Versace opened in Dubai's Al Jaddaf district in 2015, instantly drawing attention for its ornate Neoclassical architecture and décor by the Versace fashion house. With 215 rooms, several high-end restaurants, a spa and indoor pool, the hotel quickly became a premier luxury destination. Operators have maintained that performance metrics remain strong, despite the auction listing being necessary to manage owner liabilities. Analysts say the new starting price presents a significant opportunity to acquire a high‑profile asset at less than half of its assessed worth. 'This is a distressed‑asset play aligned with strategic debt deleveraging, rather than a reflection on operational viability,' said one Dubai real estate consultant briefing Gulf News executives. Market watchers will closely monitor whether the final sale price climbs closer to its original valuation or settles nearer the floor. Discussions among financial commentators suggest that the property's position in Al Jaddaf and its brand association with Versace offer intrinsic appeal for portfolio expansion. Dubai's hospitality market has witnessed robust tourist inflows in the wake of Expo 2020, highlighting ongoing demand for experiential luxury. Occupancy rates across premium hotels, including Palazzo Versace, remain above pre‑pandemic levels, with leisure and business travel continuing to underpin growth. Still, caution prevails. The global economic backdrop, featuring elevated interest rates and tightening monetary policies, poses risks to leveraged investors. In the local market, Union Properties' aggressive debt repayment activity—more than Dh730 million in bank charges during 2024—underscores broader stress in the regional real‑estate sector. A successful bid must, therefore, balance operational upside against financial exposure. Financial observers note that the $163 million start price effectively benchmarks the valuation of the asset at roughly Dh600 million. At that level, the hotel's existing EBITDA and projected future cash flows could justify acquisition for mature investors seeking longer‑term value realisation. Early bidders are expected to scrutinise actual revenue trends and any outstanding contractual obligations tied to the site and brand licence. ADVERTISEMENT Expert sources familiar with the process suggest Union Properties is targeting a swift divestment timeline, potentially concluding the sale within the quarter provided bidding activity meets expectations. The developer's broader strategy appears focused on capital recycling, reducing non‑core holdings and concentrating on core property development initiatives. Should Aleo or other entities submit competitive offers, the outcome will be seen as a high‑stakes test of investor appetite for luxury hospitality assets in key Arab Gulf markets. A sale price closer to the original valuation would signal renewed confidence in Dubai's upscale segment. Conversely, a lower‑priced transaction may underscore lingering valuation recalibration across the region. The unfolding auction has already sparked commentary among regional hospitality analysts, with one noting: 'This is less a fire‑sale and more a market correction—Al Jaddaf remains a coveted precinct, and the Versace brand retains international cachet.' However, another consultant warned: 'Potential overexposure to debt could deter serious bidders unless the asset's income stream is fully de‑leveraged.' Union Properties' financial communications team confirmed the process is being conducted via a designated online portal, with qualified potential purchasers able to register to bid. Details around bid submission deadlines, due diligence arrangements and any minimum increase increments were not disclosed.
Arabian Post
10-06-2025
- Business
- Arabian Post
Arqaam Capital Intensifies ECM and DCM Push Amid Gulf Deal Boom
Arqaam Capital is stepping up its equity capital markets, debt capital markets, and loan syndication operations in response to an upswing in transaction volume across Saudi Arabia and the UAE, positioning itself as a more prominent regional player. The Dubai‑based financial services firm, with licenced offices in the UAE, Saudi Arabia, Egypt and Lebanon, has secured permissions in the Kingdom of Saudi Arabia to advise on ECM mandates. Rawad Kassouf, Head of ECM Execution & Syndicate, noted that the Saudi team is undergoing expansion and actively leveraging a 27‑strong research analyst base to deepen research capabilities and strengthen regional and international distribution for issuers. Arqaam, originally a sales and trading brokerage, entered the ECM arena by managing the Dubai Holding REIT as a joint bookrunner. Kassouf, who joined from ADCB in August 2024 to spearhead ECM expansion, said, 'We're getting deals from the UAE, Saudi Arabia and Oman, and we expect to advise on more ECM transactions by year end'. He anticipates increasing activity in Saudi listings, particularly from industrial and real estate sectors driven by large family-owned businesses seeking to list on Tadawul. ADVERTISEMENT Expansion across the debt-markets is being led by Omar Musharraf, newly appointed Managing Director of Debt Solutions and DCM. Musharraf joined less than two months ago from Oman Investment Bank, where he headed structured finance and DCM. At Arqaam, he is tasked with growing the debt platform by anchoring flow business in DCM and loan syndications, as well as higher‑margin structured finance and private credit. GCC debt capital markets had outstanding debt exceeding US$1 trillion by end‑Q1 2025, rising 10 % year‑on‑year, with quarterly issuance hitting US$89 billion—a modest 3 % year‑on‑year decline despite quarterly growth. Musharraf remarked on the sophistication of issuances and tighter pricing, increasing competition and compressing fees: 'Value creation now hinges on structuring complexity and execution'. By year‑end, Musharraf expects a full debt solutions strategy supported by new fixed‑income analysts added to the research team. Arqaam has already supported key transactions, such as the Sobha deal, and is involved in several additional corporate, financial institution, and sovereign debt transactions, also evaluating private credit opportunities. The firm is staging its DCM expansion prudently, targeting high‑quality credit issuers—government‑linked entities or private sector firms aligned with regional priorities, including oil and gas. It is also aiming to tap deeper into sukuk markets and Additional Tier 1 issuances across Saudi and the UAE. New regulatory standards are catching attention: AAOIFI's Standard 62 introduces potential complexities to sukuk issuance, prompting careful monitoring by Arqaam. ADVERTISEMENT Forecasts indicate around US$35 billion of debt refinancing across the GCC in 2025–26, driven by sovereign and corporate maturities as well as infrastructure financing and economic diversification strategies. Musharraf commented, 'Debt refinancing alone will keep us active, with a significant volume of sovereign, corporate and FI maturities on the horizon,' alongside new issuances from regional and global players. Kassouf highlights Oman as a potential growth market: an upgrade from frontier to emerging market status—possibly scheduled for next year—could attract increased foreign direct investment, re‑ratings and valuation boosts. Despite the growth trajectory, both ECM and DCM businesses face pressures. Kassouf points to 'tight fees and stiff competition,' especially in post-launch aftermarket performance, which requires a delicate equilibrium between issuer objectives and investor returns. Musharraf echoes this sentiment, acknowledging fee compression and the escalating demand for intricate structuring. Arqaam is taking a strategic approach in response. The firm is intensifying recruitment across ECM and DCM, enhancing its research infrastructure to include fixed-income analysts and emphasising structuring capabilities that justify its advisory fees. This expansion is underpinned by strong macroeconomic fundamentals in the Gulf region. Saudi Arabia—responsible for 45.1 % of GCC DCM outstanding—and the UAE, with Qatar, are at the forefront. ECM activity is gaining momentum, with growing participation from real estate conglomerates looking to diversify via public listings. Government‑related entities are expected to fuel much of the pipeline in Q3 and Q4, though privately owned firms are increasingly opining on listing possibilities. Oman's evolving market classification adds another source of upside, potentially drawing new players and capital. Looking ahead, Arqaam Capital seems poised to navigate the complexities of Gulf capital markets with a reinforced advisory model, deeper research backing, and a dual‑track strategy across ECM and DCM. The firm is strategically augmenting its teams, refining product offerings, and tracking regulatory and market shifts to capitalise on Gulf investment flows while standing firm against competitive and pricing headwinds.
