By NNN-KUNA
London : Britain’s most expensive residential development is to be funded by Islamic finance, the first time a property deal in this country has been backed by money raised in line with religious laws laid out in the Quran, it was revealed here.
The 1.3 billion pounds loan, to be used to turn the Chelsea Barracks, in central London, into luxury flats, a hotel and health spas, shows how Middle Eastern wealth is increasingly used to finance business deals in the UK, the Financial Times (FT) newspaper said Monday.
Only last month, the financial group Aston Martin completed the first Islamic leveraged buy-out of a British-based company, in a 522 million pounds deal using Sharia-compliant debt, which must pay investors profits or rent rather than interest, the paper said.
Developers Nick and Christian Candy and the Qatari Government announced last January that they had bought the 12.8 acre site between London’s exclusive Sloane Square and the River Thames from the British Ministry of Defence, ending the barracks nearly 150-year links with the military, the main business daily in Europe said.
“This will open people’s eyes to the possibilities for Islamic financing to help business in the UK,” said Mark Payne, partner at “Clifford Chance,” the international law firm that structured the deal. “It shows that with a bit of imagination and creativity Islamic financing is possible on a wide-range of assets, including a complex development such as this,” he told the paper.
“We will certainly see more of these types of deals,” Payne added.