Press Release

VIS Reaffirms Management Quality Rating (RMC) of Arif Habib Dolmen REIT Management Limited

Karachi, October 25, 2022: VIS Credit Rating Company Limited has reaffirmed the Management Quality Rating (RMC) of Arif Habib Dolmen REIT Management Limited (AHDRML) at ‘AM2+ (RMC)’ (AM-Two Plus (RMC)). The rating of ‘AM2+ (RMC)’ (AM-Two Plus (REIT Management Company)) indicates that the asset manager exhibits very good management characteristics. Outlook on the assigned rating is Stable. The previous rating action was announced on September 22, 2021.

The assigned rating incorporates sound corporate governance & policy framework, presence of experienced management and sponsors’ profile of Arif Habib and Dolmen Groups. AHDRML benefits from both operational experience and financial support of the sponsors in developing and managing real estate projects. Research and investment functions of the company are considered adequate.

AHDRML has been managing its flagship fund Dolmen City REIT (DCR), since its launch in FY15. Additionally, the RMC has recently added 3 REIT projects in FY22, namely Silk Islamic Development REIT (SIDR), Silk World Islamic REIT (SWIR) and Globe Residency REIT (GRR). DCR has posted mixed performance over the years, as rental yields were affected by rental waivers accorded to tenants on account of Covid-19. Since then, DCR’s revenues (comprising of rental and marketing income) increased by 34% in FY22. In addition to the 4 REIT funds already under management, there are plans to launch 7 additional REIT funds going forward.

The RMC’s business risk profile has depicted improvement since preceding year, as illustrated by improvement in efficiency ratio, which improved from 98% in FY21 to 52% in FY22. The improvement in efficiency ratio was mainly a result of strong uptick in management fee. Apart from 23% increase in management fee on DCR, the RMC also started booking income under the 3 newly launched developmental REITs. However, since these REITs are fundamentally different from DCR, being developmental REITs, the market for this new type of fund is yet to be tested. VIS views this as a risk, and will continue to review the unit offtake of these new REITs on an ongoing basis. Given the strong internal capital generation noted in FY22, the RMC’s gearing level has receded to 1.5x as of Jun’22 vis-à-vis 1.8x as of Jun’21. As such, there are no additional debt plans on the anvil through the rating horizon. Accordingly, as per management projects, gearing is envisaged to trend down on the back of internal profit generation capacity

For further information on this rating announcement, please contact Mr. Arsal Ayub, CFA or the undersigned (Ext: 207) at (021) 35311861-66 or email at

Sara Ahmed

Applicable Rating Criteria: Management Quality Rating of RMC (December 2018)

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