Sheikh Salman bin Hassan Al Thani, Chairman of Mazaya Real Estate Development Company.
Doha: Mazaya Real Estate Development Company aims to enhance its real estate investments portfolio by QR500m, said Sheikh Salman bin Hassan Al Thani, Chairman of the company. Mazaya Real Estate Development Company yesterday held its Ordinary General Assembly Meeting yesterday.
“The company’s strategy is to enhance our real estate investments portfolio by QR500m. This is already underway, with investments of QR220m on properties with fixed income for several years and an estimated return of 7 percent. The portfolio should be completed within the next two years,” said Sheikh Salman bin Hassan Al Thani, addressing the shareholders during the AGM. During the meeting, shareholders approved the items on the agenda.
He added that the company would enhance its activities in real estate development through the selling of housing units. The first of these projects will be launched in 2022.
“During the year 2021, there was a change in the composition of the Board of Directors and the Executive Management of the Company. The new administration, in cooperation with the Board of Directors, is keen to develop a clear strategy for managing the Company’s assets and developing its activities,” he said.
“Corrective decisions have to be taken to reflect the current reality of the Company’s assets, and the Board will continue to work to achieve growth while reducing risk,” he added.
Under the directives of the new management and to reduce expenses, the company undertook major administrative restructuring, which led to a decrease in administrative and operating expenses.
Furthermore, the Company restructured its loans for a longer term and a lower profit. The affects of this restructuring will be reflected in the financial statements for the year 2022.
He said that the company would also seek to benefit from the growth in the tourism sector, as it is currently working on securing accommodation for visitors during the 2022 FIFA World Cup period in its properties. The Company will also seek to benefit from the facilities provided by the State to stimulate the real-estate market by supporting the growth of tourism and the new policies of golden residency and foreign ownership.
He said “the Company faced several challenges during 2021 which had an impact on various levels, and we emerged in the year 2021 from difficult circumstances. In 2020, the Company received a qualified opinion from the external auditors relating to two of our assets. This led us to carrying out a comprehensive re-evaluation of our real-estate portfolio in the aim of ascertaining the correctness of the evaluations.
The outcome of the re-evaluation led to a decrease of 11 percent in the company’s assets with an allocation of QR272m of provisions against our real estate investments.
He said Tala Residence Compound was leased to Qatar Foundation on a 10-year contract that will end in August 2022. There will be a significant decrease in the rental value if it is leased in the current market situation compared to the lease with QF. Accordingly, a provision was booked for a decrease in accordance with international accounting standards, amounting to QR148m which make up approximately 54 percent of the allocations for the year 2021.
“With regards to the Lusail Marina project which faced many challenges, we are currently reviewing the terms of the BOT contract with Qatar Foundation and are looking for ways to change the project’s activity to suit developments and changes in the real estate market in general and the Lusail region in particular,” he said.
“Given the uncertainty in the possibility of continuing the project, a provision has been reserved for the full book value of the project. In the event that an agreement is reached and the project is launched, part or all of these provisions can be recovered. The allocation for the Lusail Marina project is approximately 26 percent of the volume of allocations for the year 2021,” he added.
He said the company is also currently carrying out comprehensive maintenance works on Gloria Hotel. The Hotel is scheduled to be completed and operating before the end of the third quarter. This is to meet the expectations of the tourism market and Qatar’s visitors and the general public during the 2022 FIFA World Cup. To reflect the true value of the hotel especially during the renovation period, a provision of QR20m was booked, approximately 7.5 percent of the volume of provisions for the year 2021.
For Al Daayen land, in 2020, the use of the land was changed from a commercial land to a residential land. He said that negotiations are being conducted with the concerned authorities to either restore the commercial license or replace it with another land suitable for development.
The shareholders will be informed of the outcome once received. In order to hedge any decrease in the value, a provision of QR30m was booked, approximately 11 percent of the size of the provisions for the year 2021.
