Off Plan Building Purchase Yields 41% IRR

The Project:

Following an in-depth market analysis, Driven Properties and its investor group including Lamar Partners Investment, owned by Abdullah Al Ajaji and a prominent KSA family office, Al Rashed Group, decided to explore off plan bulk-unit purchase opportunities in Dubai. After shortlisting several potential opportunities, the group approached Dubai Holding about Le Pont Building 3 in prestigious Port De La Mer and proposed a liquidity solution to de-risk the project for the developer.

The Solution

In March 2019, Driven Properties and investors made a strategic acquisition of Le Pont Building 3 from Dubai Holding for a AED 194 million commitment or AED 1,750 per square foot, with a AED 58.2M with investment and a flexible 3-year payment plan. This purchase, which comprised a significant footprint of the full master plan, included only prime buildings with the best views of the marina, sea, and Dubai skyline. According to Hadi Hamra, Portfolio Manager at Lamar Partners Investment, “We found the perfect opportunity for the investment group and for the developer. When business needs converge like they did, it’s a beautiful thing.”

Driven focused on selling inventory within the UAE and abroad. Local distribution centered around the company’s 500+ agents and a large database of frequent buyers with which it has trusted relationships. Internationally, the business targeted alternative markets such as Japan using its UAE-based marketing team and extensive business development network in East Asia. The project garnered significant interest and uptake.“ Driven reached out to its proprietary list of over 1000 buyers and the response was unmistakable. They trusted Driven’s ability to present strong investment opportunities, and the results from these efforts speak for themselves,” Hamra said.

The Results

The international sales and marketing approach succeeded in fully selling out the building for a combined AED 300 million, or AED 2,700 per square foot. Principals and investors yielded an impressive 41% Internal Rate of Return (IRR).