Abu Dhabi-based Aldar Properties announced a 2% increase in second-quarter net profit of 2020, supported by revenue from development work, which overcame the challenges of shutting down Covid-19 through “innovative financing packages” and digital solutions for clients.
Aldar reported profits of 484 million dirhams ($ 132 million) in the second quarter, and revenues of 2.01 billion dirhams ($ 574 million) – an increase of 21% over the same period last year.
The real estate company said the revenue growth was driven by “strong demand for its flagship projects and lands that support the infrastructure” and “fixed fee income from third-party development management business” helped boost its quarterly numbers.
Aldar Properties said in its earnings statement that the Abu Dhabi real estate market is supported by government incentives for homebuyers, fiscal stimulus measures and programs to boost private sector growth.
Aldar’s development work was marked by a distinguished quarter, as it rapidly adapted to arrange innovative financing packages and offer digital solutions, ensuring service excellence for its customers. This resulted in revenue and profit growth and strong cash flow.
Their prime investment properties continue to perform solidly, and as the most efficient platform for real estate ownership in the region, they are looking at attractive opportunities to expand their diversified portfolio.
Aldar’s development management business recorded AED 1.27 billion in development revenue in the second quarter, an increase of 83% year-on-year.
The growth was driven by “strong progress” in projects under development, strong inventory sales, and the company’s fee-based business, including contracts worth 5 billion dirhams with the Abu Dhabi government announced in 2019.
Aldar properties said that development sales in the second quarter amounted to 505 million dirhams for projects on Nareel Island and Yas Acres, in addition to the sale of plots of land on Saadiyat Island.
Meanwhile, Aldar’s asset management business recorded a 21% year-on-year decline in net operating income, with hospitality and retail properties temporarily closed for most of the period.
Occupancy rates across the investment property portfolio, which includes residential, retail, and commercial assets, were at 88%.