UAE – Mubasher: ENBD REIT, the Shari’a compliant real estate investment trust managed by Emirates NBD Asset Management Limited, has hedged AED 400 million facility with Mashreq Bank.

Through a Shari’a-compliant profit rate swap with the bank, ENBD REIT seeks to cover 56% of its total outstanding debt, according to a press release on Monday.

The agreement will set the variable rate of EIBOR for a two-year period starting June 2021 and ending June 2023.

The management of the Fund is planning to cut costs to mitigate the coronavirus (COVID-19) impact and real estate market fluctuations.

The head of real estate at Emirates NBD Asset Management, Anthony Taylor, said: "Given a lower interest rate environment, we have a compelling opportunity to reduce our finance costs – the REIT’s single largest expense – into the future."

The head of Corporate and Investment Banking Group at Mashreq Bank, Joel Van Dusen, remarked: "The transaction reaffirms our ability to offer innovative risk management solutions specific to our customers’ needs, enabling them to mitigate and hedge specific risks as well as provide more certainty."