Real estate giant, Sobha Realty, successfully launches $750 million worth of green sukuk, marking it as the largest such issue in the year 2025 among real estate developers.
Sobha Realty, a leading real estate developer in Dubai, has made history with the successful completion of a $750 million Green Sukuk issuance. This marks the largest Green Sukuk issuance by a real estate developer globally in 2025.
The order book for the issuance reached an impressive approximately $2.1 billion, representing 2.8 times the issue size. This strong demand underscores the growing interest in sustainable finance instruments in the Middle East.
The Sukuk was issued under Sobha's $1.5 billion Trust Certificate Issuance Programme and will be used to finance or refinance projects that meet the eligibility criteria outlined in Sobha Realty's Green Financing Framework. This framework follows internationally recognized guidelines, including the International Capital Market Association (ICMA) Green Bond Principles and the Loan Market Association (LMA) Green Loan Principles.
Emirates NBD, a leading banking group in the region, served as the bank involved in financing the Sukuk issuance and acted as Joint ESG Structuring Coordinator. Deutsche Bank and Emirates NBD Capital also took on the role of Joint ESG Structuring Coordinators for the issuance.
A broader group of 13 banks, including First Abu Dhabi Bank, Deutsche Bank, and Abu Dhabi Commercial Bank, served as Joint Lead Managers and Bookrunners. Dubai Islamic Bank, Emirates NBD Capital, J.P. Morgan Securities, Mashreqbank, and Standard Chartered Bank acted as Joint Global Coordinators for the Sukuk issuance.
The pricing for the Sukuk tightened by 50 basis points from the initial guidance due to high interest. The Sukuk was priced at a profit rate of 7.125% per annum, with an effective yield of 7.375%.
The proceeds from the issuance have not been specified. However, it is expected that the Sukuk will receive credit ratings of Ba2 (Stable) from Moody's and BB (Stable) from S&P, consistent with the ratings of the obligor, PNC Investments LLC.
The Sukuk issuance involved a consortium of regional and international financial institutions. Regional investors took up 56% of the allocation, while 44% went to international participants. The issuance was dual-listed on the London Stock Exchange and Nasdaq Dubai.
Legal advisory was provided by Clifford Chance and Dentons, with Grant Thornton appointed as auditor for the Sukuk issuance. An independent Second Party Opinion was provided by DNV to confirm alignment with best market practices for the Sukuk issuance.
The Sukuk issuance comes amid growing interest in sustainable finance instruments in the Middle East, as corporates align capital-raising efforts with environmental, social, and governance (ESG) goals. This move by Sobha Realty is a significant step towards sustainable development in the real estate sector.
