Dubai Residential REIT

A landlord older than its own accounts

The portfolio is decades old; the issuer is not. The fund was licensed by the Securities and Commodities Authority on 23 May 2025 and its units began trading five days later, on 28 May 2025. The offering was entirely secondary: DHAM Investments sold 1.95 billion of 13.0 billion units, 15%, kept 11.05 billion and no proceeds entered the vehicle. That means FY2025 is the first and only audited annual base, and any longer series a reader finds describes a predecessor property portfolio rather than this listed fund.

What the fund owns is concrete enough. At 30 June 2026 it held 35,976 residential units across 22 communities, split between premium, community, affordable and corporate-housing tiers, with names such as Bluewaters, City Walk, Ghoroob, Remraam, Shorooq, Al Khail Gate, The Gardens, Discovery Gardens, Manazel Al Khor and Nad Al Sheba. More than 220 small businesses and multinationals rent the commercial space attached to those communities. Seven wholly owned subsidiaries hold the assets; DHAM REIT Management LLC runs everything from outside.

Ninety-nine per cent collected, seventy-eight per cent provided against

The headline operating numbers are strong: occupancy 98.6%, collections 99.7%, retention 94.1% and average rent of AED59.7 per leased square foot a year. Behind them, in the interim notes, sits a balance the investor pack omits. Gross trade receivables of AED218.981 million carry a loss allowance of AED171.126 million, 78.15% of the total, and gross unbilled receivables of AED6.854 million carry AED4.609 million, 67.25%. A 99.7% collection rate on current billing and a heavily provided legacy book are not contradictory, but only one appears on the slide.

Occupancy this high pushes growth onto rent and acquisitions

H1 2026 revenue was AED1,035.658 million, 8.13% higher, and profit before investment-property revaluation AED716.476 million, up 15.14%. A fair-value gain of AED373.001 million lifted reported profit to AED1,089.477 million, so 34.24% of the bottom line created no cash; operating cash flow was AED751.958 million. Management reported funds from operations of AED716 million, maintenance capital expenditure of AED38 million and recurring funds from operations of AED678 million. The FY2025 comparison is AED1,953.5 million of revenue, AED1,492 million of adjusted earnings before charges, AED1,279 million of funds from operations, AED88 million of maintenance spend and AED1,191 million recurring.

With occupancy already at 98.6% there is almost no vacancy left to fill, so incremental income has to come from rent reversion within the rent-index rules, from cost control, or from buying more homes. Gross asset value rose 6.94% to AED25.171 billion while net asset value rose only 2.42% to AED22.581 billion, AED1.74 a unit, because the June purchase was funded rather than free.

The seller of the June homes and the owner of the fund are the same group

That purchase was AED1,135 million paid to a related party, against AED1,299.4 million at which the external valuer carried the same scope on 30 June. The gap is not a proven gain until timing, scope and terms are bridged. The manager charged AED79.608 million in the half against AED10.498 million a year earlier, fellow subsidiaries billed AED24.284 million of operation and maintenance and paid AED46.615 million of lease and service income, and AED108.602 million was owed to related parties against AED0.635 million owed by them. Funding for the deal came from an AED850 million drawdown on the AED3.7 billion revolving facility priced at three-month EIBOR plus 80 basis points and maturing in November 2029, leaving AED1.223 billion undrawn against AED2.073 billion at the year end. Drawn debt of AED2,450 million, 66% conventional and 34% Islamic, against AED746.368 million of cash gives net leverage of 6.8% and gross 9.7%. The AED360 million of profit-rate swaps carried at the year end matured during the half and none replaced them.

What the pack leaves out

There is no weighted average unexpired lease term, no expiry ladder, no tenant concentration table and no community-level net operating income, so the durability of that 94.1% retention cannot be tested against contract length. The valuation is entirely Level 3 and formed 96% of total assets as the sole key audit matter in Deloitte's unmodified FY2025 opinion, yet no quantified shock table accompanies the listed sensitivities. The H1 distribution of AED573.2 million appears as AED0.04 per unit in the reviewed statements and AED0.044 in the later formal notice, and no payment date was registered at the cut-off. This page carries no valuation, no yield calculation and no view on the units.