Dubai's Arzan Wealth nets 'solid returns' on New Orleans property exit

Daniel van Niekerk
2 Jun, 2020
Dubai's Arzan Wealth nets 'solid returns' on New Orleans property exit

Arzan Wealth, a Dubai-based advisory firm, has announced the successful exiting of a mezzanine, or sharia-compliant, property lending transaction in New Orleans, Louisiana, delivering 'strong investor returns.'

The company said the New Orleans transaction utilised the innovative Real Estate Index Linked Securities (REILS) structure.Arzan Wealth said this investment was part of its Debt Platform, which focuses on identifying investments into real estate debt opportunities.

The New Orleans transaction utilises the innovative Real Estate Index Linked Securities (REILS) structure, which is an amortising mezzanine loan, and was structured in a sharia-compliant manner.

The initial investment was made in 2018 to finance a portfolio consisting of 740 residential properties located in New Orleans at Louisiana.
The transaction was structured with a net 8% coupon, payable quarterly, and with an escalating quarterly amortization schedule as well as an additional payment at the end of the instrument's term that was designed to generate a total IRR of between 9.4% and 11.8%.
Arzan Wealth acted as the sub-strategic advisor on the exit of this investment at a net IRR of 11.9% pa.

Muhannad Abulhasan, CEO of Arzan Wealth, said: "The Arzan Wealth team is very proud to be able to advise on the exit of the New Orleans REILS deal, and at the highest possible IRR as designed by us when we advised on entering the deal two years ago."
"We are particularly pleased to be able to deliver these very positive results to our loyal investors in the midst of the global economic catastrophe that is unfolding as a result of the covid-19 public health crisis," he added.
"An IRR of 11.9% from a safe and income-producing real estate debt investment is consistent with Arzan Wealth's objective of offering clients superior risk-adjusted opportunities in mature real estate markets. The stable and regular cash flow payments from our REILS transactions have proven to be an important stabilizing element in the portfolios of our clients, especially during turbulent economic times like the one we find ourselves in today."

by Tanya at http://www.ifajobs.net

Daniel van Niekerk

Daniel van Niekerk

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