Shariah law property deals on the rise in Scotland

Shariah-compliant property investment opportunities in Scotland are being pitched as an alternative to the “cooling” London market as part of a push by the Islamic Finance Council UK (UKIFC).

Omar Shaikh pointed to a marked increase in the number of Scottish Shariah-compliant deals.

The council has partnered with major financiers and advisers to create a brochure encouraging investors to seek deals north of the Border under the Islamic financial system.

Based on Shariah, the law of Islam, the Islamic system views social benefit as a key consideration for property financing, along with the avoidance of interest.

Sign up to our daily newsletter

The i newsletter cut through the noise

There have been more than £250 million worth of Shariah-compliant property investment deals in Scotland in the last five years, with returns on Scottish commercial property exceeding the UK average in 2018.

Recent examples include Atlantic Quay 1, a refurbished Grade A office investment which was acquired in 2018 by Bank of London and the Middle East in partnership with Darin Partners in a £55m deal.

Read More

Read More
Fife manufacturer supplying vital medical components urges other SMEs to share c...

Produced in conjunction with BDO, Gatehouse Bank, Ocorian and Shepherd + Wedderburn, the brochure shines a light on factors such as the Scottish Government’s proactive approach to foreign investment, Scotland’s technically skilled workforce and the country’s natural habitat.

Omar Shaikh of the UKIFC said: “There has been a marked increase in the number of Scottish Shariah-compliant deals completed in recent years in distribution centres, office blocks and student accommodation, amongst others.

“Investors have been seeking better yields than what is on offer in the London region. There are no legal barriers as the structures used to accommodate Shariah-compliant property transactions offer the same protection as those in England.

“Despite the current coronavirus crisis which is affecting economies across the world, over the medium-term the fundamentals of the Scottish market continue to present an attractive investment proposition.”

Ed Peters, tax director with BDO, added: “Over the last decade, a key area of specialism for BDO has been advising Shariah-compliant investors looking to invest in real estate outside their home jurisdictions.

“This investment has been increasingly focused outside of London’s saturated market, and more on areas which provide greater value, such as Scotland, where we have seen a number of clients making significant investments in grade-A assets such as Atlantic Quay 1 and the Edinburgh headquarters of Scottish Gas.

“We expect to see this trend continue once the impact of coronavirus eases, as investors look to geographically diversify risk and secure value.”

A message from the Editor:Thank you for reading this story on our website. While I have your attention, I also have an important request to make of you.With the coronavirus lockdown having a major impact on many of our advertisers - and consequently the revenue we receive - we are more reliant than ever on you taking out a digital subscription.Subscribe to scotsman.com and enjoy unlimited access to Scottish news and information online and on our app. With a digital subscription, you can read more than 5 articles, see fewer ads, enjoy faster load times, and get access to exclusive newsletters and content. Visit https://www.scotsman.com/subscriptions now to sign up.

Our journalism costs money and we rely on advertising, print and digital revenues to help to support them. By supporting us, we are able to support you in providing trusted, fact-checked content for this website.

Frank O'Donnell

Editorial Director

 0 comments

Want to join the conversation? Please or to comment on this article.