The UAE’s Al-Futtaim Group and the local Qatar Islamic Bank are due to complete the financing for the Doha Festival City mall development by the end of November, according to bankers close to the deal.

The QR6bn ($1.6bn) project is hoping to raise around QR3.6bn to fund the development.

The financing will be provided in Qatari riyals and is split into a conventional and an Islamic tranche. The final size of the two tranches is not yet determined, but the Islamic tranche is expected to be around QR1.2bn, with the conventional tranche making up the remainder. Both have a tenor of about 10 years. In total, seven banks are thought to be in the lending group, including some non-Qatari banks that have a presence on the peninsula.

One banker in Qatar says that a recent ruling from the Qatar Central Bank that conventional banks in the country have to close their Islamic banking operations has led to confusion as to whether non-Islamic banks can participate in Islamic syndicated loans. “It’s a grey area so some banks are trying to avoid doing any more Islamic loans until they know for sure how the rules affect them,” says a banker in Doha.

QInvest, a local investment bank, is leading the fund raising for the project, along with Al-Futtaim’s investment and development arm, Al-Futtaim Capital.