Arada raises $400m in first UAE real estate debt sale since conflict began
Arada Developments has sold $400 million of five-year sukuk to regional and international investors, closing the first debt issuance by a UAE real estate developer since the regional conflict began in February 2026. The transaction, listed on the London Stock Exchange and Nasdaq Dubai, reopened a financing channel that had been shut for the country’s property sector for most of the year.
The order book closed above $700 million, excluding joint lead manager interest, and peaked at twice the offering size, according to the company. That demand let Arada price the senior unsecured sukuk at an annual coupon of 8.875 per cent, down from initial price guidance of 9.375 per cent. Fitch assigned the issue an expected rating of BB- and Moody’s B1; the company itself carries B+ and B1.
For other UAE developers, the sale is a market signal as much as a balance-sheet event. Property credit has been the sector’s most fragile link since the conflict started, with lenders and bond investors stepping back from project funding while Gulf equity and bank liquidity stayed comparatively open. A Sharjah-based developer selling five-year unsecured debt at a fixed coupon, against a backdrop the company itself describes as volatile, gives peers a fresh pricing benchmark. The 50-basis-point tightening from guidance, in particular, tells them where investor tolerance now sits.
The timing also matters. Arada has a $411.7 million sukuk carrying an 8.125 per cent coupon maturing in June 2027, and the new money is expected to be largely leverage-neutral. Part of the proceeds will fund a tender offer of up to $180 million for its existing sukuk, extending the maturity profile rather than adding net debt. Developers watching the deal will read that as liability management, not expansion borrowing.
Prince Khaled bin Alwaleed bin Talal Al Saud, Arada’s executive vice chairman, said the return to international debt markets reflected “the resilience of Arada’s business and the enduring confidence of regional and global investors not just in our story, but in UAE real estate more generally.”
The bookrunners point to how broad the demand was. Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, Mashreq and Standard Chartered acted as joint global coordinators, with Arab Bank, Arqaam Capital, Bank ABC, Goldman Sachs International, JP Morgan Securities, Sharjah Islamic Bank and Warba Bank as joint lead managers and bookrunners. A list spanning local Islamic banks and global houses suggests the order book drew from both conventional and Sharia-aligned accounts, though the company has not disclosed the investor breakdown.
Arada’s own runway is long. The group counts a global pipeline of existing and future projects valued at more than AED185 billion across the UAE, Saudi Arabia, the UK, Australia and Syria, and says it has sold more than 20,000 UAE homes worth over AED40 billion since 2017, completing more than 17,000 units worldwide.
The next verified indicator is the tender offer itself: whether existing sukuk holders sell back up to $180 million of paper, and at what acceptance level, will show how the market now prices Arada’s older, cheaper debt against the new 8.875 per cent curve.
