As part of its strategic focus on structured debt investments, Arzan Wealth (DIFC) Limited (“Arzan Wealth”), a Dubai-based advisory firm regulated by the Dubai Financial Services Authority, has advised on an investment in an amortizing mezzanine loan to a U.S.-based sponsor, secured by a portfolio of single-family rental homes across the United States. The investment structure has been designed in accordance with Shariah principles.
The sponsor specializes in workforce housing supported by government rental guarantees and manages a portfolio with over USD 280 million in gross assets. This transaction includes approximately 1,600 rental units located in Baltimore, Pittsburgh, and Detroit.
The loan carries a three-year term, with two optional one-year extensions to allow time for refinancing or sale of the assets. Investors will receive quarterly distributions, generating an average annual post-tax yield of approximately 10.5%, net of fees and expenses. These payments are supported by both the property portfolio’s operational income and fee income from the sponsor’s operating platform. Additionally, investors are entitled to a final fixed payment and an accrued return, bringing the expected net internal rate of return (IRR) to approximately 13.2%.
Arzan Wealth advised on the structuring of the mezzanine instrument and conducted thorough due diligence on the collateral assets. Leveraging its on-the-ground capabilities in the U.S. through its wholly owned subsidiary, Arzan US—acting as Special Servicer for this transaction—Arzan Wealth will continue its advisory role throughout the investment’s holding period, ensuring close oversight and strategic execution.
Muhannad Abulhasan, CEO of Arzan Wealth, commented:
“This transaction reflects our commitment to delivering secure, risk-adjusted returns through well-structured debt strategies. In today’s elevated interest rate environment, amortizing loan structures provide attractive yields while enabling faster capital recovery. Our local presence in the U.S. through Arzan US enhances our ability to actively monitor assets and ensure alignment with investor interests. As a trusted advisor, we continue to guide our clients toward globally diversified strategies that support their long-term objectives”.
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