Global unveils Business Town in Al-Mirqah

26 December 2004
The local Global Investment Househas announced plans to develop an estimated KD 70 million-75 million ($241 million-258 million) mixed-use development in the Al-Mirqab district of Kuwait City. To be called Kuwait Business Town, the 11,000-square-metre development will include offices, shops, malls, convention centres, leisure facilities and a multi-storey car park.

A private placement for the project company, Kuwait Business Town Holding Company (KBT),closed on 20 December, and was three-four times oversubscribed. A total of 389.5 million shares were offered to private investors at KD 0.1 ($0.34) a share, raising KBT's capital to KD 40 million ($138 million). Global, the offering's lead manager, says it expects an internal rate of return (IRR) for KBT of 14.6 per cent, with profits maximised through a combination of selling and leasing the development's properties.

Local real estate developer Al-Mazaya Holding Companyhas been brought on board to manage KBT for the first three years, after which KBT will manage operations itself. A consultant for the development's detailed design has yet to be appointed.

Kuwait City is undergoing a real estate boom as international companies increasingly use the state as a gateway for reconstruction activity in Iraq (MEED 12:11:04; 5:11:04).

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