Bawabat Al Shamal Real Estate Company (Basrec), a JV between Al-Futtaim Real Estate, Qatar Islamic Bank and Aqar Real Estate Development And Investment, has inked a QR3.7 billion ($1.01 billion) syndicated facility to fund the development of its Doha Festival City project.

The QR6 billion Doha Festival City is being developed by Basrec on a 433,847sq m plot which will include 260,000 sq m gross leasable area of retail space offering over 500 retail units which will include a large number of new brands to Qatar.

The project will also boast of the first Ikea store in Qatar, and will feature an entertainment and leisure complex, automotive showrooms, international hotels and convention centre.

Speaking at the signing ceremony, Marwan Shehadeh, the general manager of Basrec said the 10-year facility was the largest Qatari private sector syndicated transaction.

'We are pleased to announce this transaction as the agreement today is a key step on the road to developing this major project. This financing will ensure the work on Doha Festival City will progress well and according to plan,' he remarked.

'We are pleased to be working with such strong and committed banking partners. The signing of this transaction is a testimony to the confidence that our banking partners have in this distinguished and iconic project,' he added.

QInvest acted as financial advisor to Basrec and the sole bookrunner for the facility. Commercial Bank of Qatar (CBQ) and Barwa Bank took the mandate lead arranger (MLA) roles with CBQ who was the original lender also acting as the lead and documentation bank on the conventional tranche as well as the conventional facility agent.

Barwa Bank was the lead and agent bank on the Islamic tranche, also taking the role of Islamic Documentation Bank.

The MLAs were joined in the facility at lead arranger level, across the two tranches, by Ahli Bank, Doha Bank, International Bank of Qatar, Al Khalij Commercial Bank (al khaliji) , Qatar International Islamic Bank and Qatar National Bank.

The development is located just north of downtown Doha on Al Shamal Road, one of the main arterial routes to the city centre, and the route that will eventually connect Doha with Bahrain via the Qatar-Bahrain Causeway.

With its strategic positioning, the super-regional complex is ideally equipped to meet the retail, hospitality and entertainment needs of not only Qatar, but also of neighboring countries.

In the first phase, the 32,000 sq m Ikea store will be completed by the first quarter of 2013, while the remaining components of Doha Festival City will be delivered in 2015.

Ahmad Meshari, the acting CEO of Qatar Islamic Bank said,  'We are pleased that our confidence in this project demonstrated by our investment is supported by Basrec’s banking partners through this transaction. We are confident the project will have a positive impact on the local economy, reflecting our strong commitment to the economic development of Qatar.'

Andrew Stevens, the group CEO of Commercial Bank of Qatar said, 'We consider this as an important transaction for Qatar as a whole and CBQ is honored to be leading the banking group in partnering with Festival City to deliver on the iconic plans for this development.'

Barwa Bank CEO Steve Troop said, 'We value the relationship that we have built with Doha Festival City and believe that the management of the project has a strong history which complements our strategy to strengthen our portfolio. In this regard, we are pleased to be leading the Islamic tranche of the financing.'

Shahzad Shahbaz, the CEO of QInvest, said the success of the deal was a testament to the efforts of the teams involved in the project and the transaction. 'QInvest has advised Basrec and its shareholders through a number of initiatives and we are pleased with the partnerships that have been brought together to develop Doha Festival City,' he added.-TradeArabia News Service