GFH Financial Group (GFH) said it has signed a $100 million real estate divestment deal with a special purpose vehicle owned by Terra Real Estate Investments as part of its previously announced $1 billion in exits from its existing real estate portfolio.

As per the deal, Terra will acquire 72 per cent stake in GFH’s landmark Harbour Row Residence in Bahrain for $40 million and $60 million of the group’s real estate development project in Morocco, said the Bahrain-based company in a statement.

This comes as part of a planned exit from GFH’s legacy real estate portfolio to be undertaken over the next five years, with proceeds of the deals expected to support profit distribution and the growth strategy of the group.

This transaction, which had an instrumental support from leading Abu Dhabi investment group ADFG, is expected to positively impact the group’s first quarter 2019 results.

Lauding ADFG for its instrumental support, CEO Hisham Alrayes said: "We are pleased to announce this transaction in line with GFH’s focus and strategy to achieve strategic exits that can continue to enhance and support our ability to deliver strong returns to shareholders in our real estate investments."

"We are committed to achieving a series of further exits from our real estate portfolio to allow the Group to minimize and reduce our overall real estate exposure," he noted.

"Such planned exits are aimed to realign all assets classes to have a balanced contributions to GFH’s operations and income generation," he added.

Mustafa Kheriba, the chief operating officer of ADFG, said: "ADFG is pleased to make this acquisition of high quality real estate assets from GFH in the regional markets of the GCC and North Africa."

"We are building sound and diverse real estate portfolio, both in the region and internationally, and will continue to seek out other opportunities to acquire quality assets of this nature," he added.-TradeArabia News Service