Invest AD freezes plans for RE fund

Plans for a $200m-$500 opportunity real estate fund are on ice owing to a lack of international investor interest in UAE real estate. The plans are part of wider strategy to streamline its focus to private equity and listed equities.

Invest AD has shelved plans for a real estate fund aimed at making opportunistic investments in the United Arab Emirates. It is the latest in a number of initiatives to be halted by the Abu Dhabi state-owned investment firm.

The idea for the fund may be resurrected by Invest AD, formerly known as the Abu Dhabi Investment Company, if market conditions improve, chief executive Nazem al Kudsi, was quoted by The National as saying.

The cancellation of the fund, however, does not spell an exit for the sector. Invest AD does manage a portfolio of real estate assets in the region such as the Capital Tower officer building in Abu Dhabi. It also owns some residential assets in the emirate.

The news about the real estate fund comes as Invest AD reduces its investment capabilities in line with reduced investor appetite for the region. In addition to the real estate fund, Invest AD has also disbanded its investment banking arm and, at the start of the month, it announced it would also not proceed with a joint venture infrastructure investment fund with UBS Global Asset Management, originally slated in 2008.

Invest AD will focus its attentions on private equity and listed equities investing. According to a spokesperson contacted by The National: “Invest AD continues to offer attractive third-party investment opportunities in listed equities and private equity, while being an active proprietary investor in all sectors of the market.”

Invest AD’s private equity division manages two funds which a number of investments around the region and in Turkey.