MIDDLE EAST - AREIT Management Limited, manager of the Arabian Real Estate Investment Trust (AREIT), has appointed Chris Purdon as chief investment officer (CIO) as part of the firm's plans to tap iopportunities in the Middle East region.
Purdon, previously chief executive officer (CEO) of Landmark Real Estate Investment Management in Dubai, will be responsible for overseeing the Trust's investments across the Middle East and the launch of new funds later this year, including a second AREIT fund, a regional opportunity fund and a Saudi Arabia fund.
AREIT, currently worth approximately $200m, is looking to increase its fund management to $500m by the end of this year through its additional funds.
According to Purdon, the firm will focus particularly on Saudi Arabia and Abu Dhabi, as it believes these countries offer the most growth potential.
"We think there is a very compelling demographic behind the Saudi population level. They have a very high population growth, they have a need for residential accommodation for the middle classes and they have a desire at the Government level to liberalise their economy and make it more attractive to foreign investment, so we see a number of compelling reasons to focus time and effort on Saudi," Purdon told IPE Real Estate.
He claims Saudi Arabia's oil reserves and the limited inflows of foreign capital have helped protect the country from the effects of the credit crisis, while Abu Dhabi's commitment to upgrade its infrastructure and economic base means there are many real estate projects for AREIT to be involved in.
Distress in the markets is also likely to offer interesting opportunities in Dubai for the firm's funds, said Purdon.
"Dubai itself we believe will continue to offer value. It is the most sophisticated market in this part of the world and has the broadest range of stock and we are already beginning to see some very attractive transactions being introduced to us as a result of those who are suffering from the credit crunch," he continued.
AREIT invests at least 80% in direct real estate in the Gulf Co-operation Council's (GCC's) countries, which include Bahrain, Saudi Arabia, Kuwait, Oman, Qatar and the United Arab Emirates.
Investors who invested in AREIT's first REIT in June 2006 received distributions of 8% per year and an internal rate of return (IRR) of over 50% on their investments.
Purdon, who has over 20 years' experience of real estate funds management, having worked with Jones Lang LaSalle and Jardine Fleming in Asia Pacific co-managing the first pan-Asian real estate investment fund and serving as Jones Lang LaSalle's head of research in Hong Kong, is based predominantly in Dubai.
AREIT Management Limited was launched in 2006 by HSBC Bank Middle East and Daman Asset Management Ltd and has offices in Dubai, Bahrain and Riyadh.
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