Banking & Finance Union Properties considers selling Dubai Autodrome By Gavin Gibbon April 18, 2023 Union Properties Amer Khansaheb said Union Properties would 'review any good offer' as part of its fundraising project Developer Union Properties could sell racing circuit Dubai Autodrome as it seeks to offload AED1 billion ($272 million) worth of assets in the next two years as part of its ongoing recovery plan. Dubai Autodrome is a fully owned subsidiary of Union Properties. Managing director Amer Khansaheb revealed the company holds 15 million square feet of gross floor area across its flagship Motor City development in Dubai. Speaking after the company’s annual general meeting, Khansaheb said: “Our target is land (sales), but we’ll obviously review any good offer that we get on any asset, be it Dubai Autodrome or anywhere else. “We have a need to raise AED1 billion of cash and we can’t say no to good deals.” Completed in 2004, the FIA-sanctioned 5.39km Dubai Autodrome circuit includes six different configurations as well as a race school, indoor and outdoor karting tracks, the Grandstand Retail Plaza, Motorsport Business Park, a VIP paddock hospitality area and entertainment facilities. According to a January report from CBRE, apartment prices in Motor City increased 2.4 percent month on month to reach AED710 per square foot. Dubai development awakens after a decade of lying dormant Dubai’s Union Properties returns to profit after restructuring Dubai real estate prices haven’t yet peaked, says S&P Mansoor Ahmed, executive director, Middle East and Africa at Colliers Middle East, said Motor City had matured into one of the leading integrated communities in the emirate. “We expect that availability of more land to the private sector will further increase economic activities within Motor City,” he said. “Moreover, in many countries, successful real estate developments are created around sport centres such as Dubai Autodrome; benchmarking and looking at international case studies will benefit the development.” imago images/Alexander Trienitz via Reuters ConnectAs well as a motor racing circuit, Dubai Autodrome features karting tracks, a business park and retail facilities Recent financial results from Union Properties show the company had turned around a AED966.8 million loss reported in 2021 to record a AED30 million profit last year - its first operating profit in seven years. Over the period expenses were slashed by more than half, from AED42.3 million to AED19.4 million. This included a 64 percent year-on-year reduction in staff salaries and benefits and an 85 percent drop in court fees and legal expenses. Office expenses were cut by more than half. Khansaheb revealed this included an office in Abu Dhabi, where he explained that between AED15-20 million was spent fitting the facility out and annual rent of AED3 million was being paid. “The company has no operations in Abu Dhabi but somehow it had this lavish office,” he said. “Unfortunately we had to let it go.” Last year Union Properties merged three of its business units – Edacom Owners Management Association, Uptown Mirdif Mall and Al Etihad Cold Store – into one single entity, Edacom Asset Management. During 2022 Union Properties also completed a AED595 million debt restructuring, marking a milestone by resolving legacy liabilities with the majority of its lenders. Khansaheb said the recovery of the company over the next six years will be led by a return to real estate activity, with sales in the region of AED3.5 billion estimated. “Obviously our ambition is to do a lot more than that, but we think this is a good first step to reach there and then to move forward,” he said. However, he conceded this would hinge on the result of a legal dispute with developer Dubailand over changes to the original masterplan for Motor City, which is currently working its way through the courts. Also at the AGM, shareholders voted to approve a settlement with the company’s former chairman Khalifa Al Hammadi, which will see AED620 million repaid to UP over the next year.