Press Release

JCR-VIS Assigns Initial Ratings to International Complex Projects Limited

Karachi, January 02, 2017: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned initial entity ratings of ‘AA-/A-1’ (Double A Minus/A-One) to International Complex Projects Limited (ICPL). Outlook on the assigned rating is ‘Stable’.

The assigned ratings to ICPL incorporate the well reputed profile of ‘The Dolmen Group’; a real estate developer operating in Pakistan which has developed & managed renowned residential, commercial and retail projects like the Dolmen City Project. Ratings also reflect strong financial profile as evident from very low leverage indicators and healthy & growing dividend income from Dolmen City REIT (DCR) and other group projects. Dolmen Mall and Harbour Front has occupancy exceeding 95% and Dolmen Mall witnessed footfalls of over 9 million during FY16. Overall corporate governance framework has room for improvement.

About the Project
Dolmen City project by ICPL is one of the largest mixed-use developments in Pakistan, which has been established to serve commercial and corporate clients. The project comprises Dolman Mall Clifton (Pakistan’s largest shopping mall) and four towers, of which, Executive Tower (sold out to third parties) and Harbour Front have been completed while the Sky Tower (Tower A) and Hotel Tower (Tower B) are under development phase. The Dolmen Mall Clifton and Harbour Front were transferred to DCR in 2015 at a value of Rs. 22 billion with 75% units held by ICPL.

Around 90% physical progress has been achieved for both the towers (Tower A & Tower B) up to October’2016 while project completion date is December’2017. While Sky Tower will be entirely reserved for offices and is planned to be sold, Hotel tower will be rented and will have two third area reserved for offices with remaining being utilized for hotel-serviced apartments. Total leasable revenue area of Tower A and Tower B is 540,000sq.ft. and 520,000sq.ft, respectively.

Cash Flows
Cash inflows for funding of Tower A and B will primarily emanate from dividend income from DCR which was placed at Rs. 2.31 billion in the last payout, sales proceeds from Tower A and corporate office rent. While risk of cash flow mismatch remains, in case of lower than projected Tower A floor sales; however, the same is mitigated by significant cash flows from associated concerns (Dolmen Mall Tariq Road & Hyderi) and borrowing capacity of the organization as evident from very low leverage indicators.

For further information on this rating announcement, please contact Mr. Javed Callea (Ext: 201) or the undersigned (Ext: 208) at 021-35311861-71 or fax to 021-35311872-3.

Mohammed Khalid Ali

Applicable Rating Criteria: Industrial Corporates (May 2016)

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited VIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2016 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited