Canadian alternative investment firm Brookfield Asset Management and its partner, state-owned Investment Corporation of Dubai, have sold part of their stake in Dubai’s largest office tower.
Brookfield and ICD, the private investment arm of the Government of Dubai, sold a 49% stake in ICD Brookfield Place, located in the heart of Dubai’s DIFC financial hub, to Chimera Investments-owned alternative investment manager Lunate and Saudi conglomerate Olayan Financing Company.
This is the largest institutional third-party single-asset real estate transaction in the UAE and one of the largest commercial real estate transactions globally since 2020, Lunate said in a statement. It didn’t disclose financial terms of the deal. However, reports suggest that the skyscraper is worth $1.5 billion.
Lunate, through one of its funds, and Olayan Financing Company will each own a 24.5% equity interest in the asset, whereas ICD and Brookfield will retain a combined 51% equity interest, split equally between the two entities.
Brookfield Properties, the real estate operating arm of Brookfield Corporation, will continue to manage the property.
Lunate, with over $105 billion in assets under management, was set up in September last year by Abu Dhabi-based Chimera Investments to target global opportunities across private equity, venture capital, private credit, real estate, public equities, and public credit markets through a combination of strategies. It is also expected to expand globally and open offices in North America, Europe, and Asia.
“Lunate’s investment in ICD Brookfield Place is aligned with its long-term capital strategy and strengthens its real assets portfolio. The acquisition, made through one of Lunate’s funds, demonstrates Lunate’s commitment to making strategic investments in high-quality assets globally,” Lunate said.
ICD Brookfield Place, the premier mixed-use real estate development, is over 98% occupied at premium rent and houses major global financial institutions, law firms, and multinational corporations, including JPMorgan Chase & Co. and Bank of America Corp.
“The stake sale is amongst the first and the largest institutional third-party real estate transactions of its size in Dubai and the Middle East region, demonstrating the increasing depth and sophistication of the regional real estate market,” said Jad Ellawn managing partner and regional head, Middle East, Brookfield Asset Management.
“It is also amongst the world’s largest commercial real estate transactions since 2020, further showcasing that capital flows continue to seek high-quality commercial properties. This monetization paves the way for what we expect will be an increased pace of M&A activity over the coming years,” he added.
Other key bidders for a stake in ICDBP included Abu Dhabi sovereign wealth fund ADQ, China Investment, Malaysia’s KLCC Property Holdings, and Saudi Arabia’s Hassana, according to reports.
ICD Brookfield Place towers more than 900 feet over the city’s financial district. It has 53 floors.
Brookfield is currently raising capital for a new fund strategy targeting private equity opportunities in the Middle East region. Of the total $900 billion of assets managed by Brookfield, real estate accounts for about a quarter of the portfolio, at $276 billion, and private equity makes up for $130 billion of the portfolio, in 30 countries across five continents. It manages $181 billion worth of assets in Europe and the Middle East combined.
ICD, with total assets over $276 billion, is the principal investment arm of the Government of Dubai. Its portfolio includes Emaar Properties, Dubai CommerCity Dubai Airport Free Zone, and ALEC Engineering, among others.
