Damac secures $229m London tower funding amid Brexit turmoil

Damac secures $229m London tower funding amid Brexit turmoil
Damac Tower is the Dubai developer's first project in the UK.
Published: 14 April 2019 - 6:30 a.m.
By: Oscar Rousseau

Dubai-listed real estate developer Damac Properties has hailed its recently secured $228.9m (AED840.6m) bank loan for a high-rise tower in London as a “vote of confidence” in the UK, which is currently caught in the midst of intense Brexit negotiations.

The developer is building a 450-unit apartment complex called Damac Tower at Nine Elms, a district of south-west London undergoing major gentrification programmes. The Versace-branded tower in London is due to complete in 2020.

On 13 April, the developer said that it had secured a multimillion-pound finance package to fund the luxury development. Due to complete in 2020, the tower is valued at $729.4m (AED2.6bn) and has been designed by architect Kohn Pedersen Fox Associates.

The developer called the finance agreement a “clear demonstration” of its faith in the UK “at a time of heightening political and economic uncertainty”.

The UK is due to leave the European Union on 31 October, 2019, unless Prime Minister Theresa May can get a parliamentary majority for her withdrawal agreement – a deal that has been defeated three times already. Lack of clarity on Brexit has created political and economic uncertainty for UK businesses.

Damac chairman, Hussain Sajwani, said the development package will provide “significant support” for the project, describing it as a “vote of confidence” for the UK economy, which grew by 2% in February, according to the country’s Office of National Statistics.

Sajwani added that Damac was already “engaged in detailed discussions” for its next investment opportunity in London.

Barclays Bank, Burban Bank, and Emirates NBD have provided capital for Damac.

Head of real estate at Barclays Corporate Banking, Dennis Watson, called Damac Tower a “landmark project” that the bank wanted to invest in to underline its “ongoing commitment to residential development” in the UK capital.

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