Binghatti Says It Can Repay 2027 Sukuk as Moody's Weighs a Downgrade

At a briefing the company held in Dubai to answer the rating agency's assessment, he said Binghatti holds about AED 2.7 billion of unrestricted cash and more than AED 10 billion in project escrow accounts, according to an account of the session published by Al Bayan. He said he was confident the review could end with the current rating confirmed, or even raised, once the company's liquidity, operating performance and expected cash flows were taken into account.

The dispute matters to more than bondholders. Binghatti is one of the most active sellers of off-plan homes in Dubai, where buyers pay most of a unit's price before the building is finished, so its ability to turn sales into cash and keep delivering units bears on customers as well as creditors. The company said it accounted for close to 10% of off-plan sales transactions in the emirate in September and October.

Moody's put the ratings on review after Binghatti's first-half results, citing a "deterioration in Binghatti's liquidity profile" and "the uncertainty surrounding the timing and generation of cash flows over the next 12-18 months". Khaleej Times reported in August that investor concern centred on the sukuk due in February 2027.

Escrow Versus Free Cash

Much of the disagreement turns on how the money is counted. Buyers' payments for off-plan units in Dubai go into project escrow accounts and are released to developers as construction advances, so a large escrow balance is not the same as cash a group can use to service its general debts. BinGhatti argued that the company's position should be judged by how quickly escrow money becomes available as projects progress, rather than only by the unrestricted balance on a given date.

He also said Moody's applies the methodology it uses for property developers in general, without allowing for the fact that Binghatti also works as a contractor on its own projects. The in-house construction arm, he said, gives the group more control over building costs and the pace of work. Under the company's payment plans, buyers pay about 70% of a unit's value before handover and the remaining 30% on delivery.

Handovers Before Year End

BinGhatti said the company is preparing to complete and hand over eight projects comprising 6,378 homes during the rest of 2026, and that several are in the final stages before delivery. Those handovers would free up more cash as buyers' last instalments come in, and part of that money can be collected before the keys are handed over as approvals are completed, he said.

Figures presented at the session showed sales so far this year up 11% to AED 14.2 billion. The company said it ranked second among Dubai developers by number of units sold in the third quarter and third by sales value. Earlier this week Binghatti reported a 65% rise in nine-month profit to AED 4.4 billion, more than it earned in the whole of 2025.

BinGhatti also said he expects prices in some parts of Dubai's property market to correct during 2027, while describing prices as broadly holding up for now.

Moody's has not yet announced the outcome of the review, which has been open since August.