Bahrain developer Diyar Al Muharraq has announced the signing of a murabaha contract worth $366 million with a group of local banks to provide financial liquidity for its Deerat Al Oyoun project.
The participating banks will partially fund the social housing project, which will cost about $700 million, a statement said.
The murabaha contract was signed with Al Salam Bank-Bahrain, Kuwait Finance House, Bank of Bahrain and Kuwait, and Al Baraka Islamic Bank of Bahrain. Murabaha is a common cost-plus-profit arrangement in Islamic finance.
The deal comes on the heels of the sale of 70 percent of homes in project, which is spearheaded by the country's Ministry of Housing to alleviate the housing needs of the Gulf kingdom.
Diyar Al Muharraq said the sales saw 70 percent of the 133 units sold, amounting to BD10 million ($26.5 million).
Dr Maher Al Shaer, CEO of Diyar Al Muharraq, said: "We are very pleased to have received such huge turnout on reservations and sales of the first phase of Deerat Al Oyoun. The project has witnessed a high demand from the second day of Eid Al Adha, with keen citizens willingly lining up to get priority on housing units suitable for them."
Located in the heart of Diyar Al Muharraq, the Deerat Al Oyoun community will span across 1.2 million square metres and will be close to schools, shopping malls, public beaches, recreational facilities, mosques, medical facilities, and a modern transportation network.
Construction of the project began last month and the first phase is scheduled for completion in February 2018.
The project is run in conjuction with the social housing scheme Mazaya whereby the beneficiary pays 25 percent of his/her monthly income and the government, through the Housing Ministry, covers the remainder of the monthly installments.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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