Union Properties' 44% Profit Surge in H1 2025

Union Properties PJSC, a prominent player in the UAE's real estate sector, has announced a remarkable 44% growth in gross profit for the first half of 2025. This impressive performance is a testament to the company's strategic focus on operational efficiency and long-term value creation.

In the second quarter of 2025, Union Properties reported AED 152.4 million in gross revenue, marking a 19% increase year-on-year from AED 128 million in Q2 2024. The gross profit for Q2 surged to AED 32.9 million, up 77.84% compared to the same period last year. These figures highlight the company's successful efforts in margin recovery and operational improvements.

Eng. Amer Khansaheb, CEO and Board Member of Union Properties, expressed satisfaction with the company's progress, emphasizing the strength of their operating fundamentals and commitment to long-term growth. The company's strategic investments in scaling up its development business and digitizing operations are expected to yield positive financial impacts in the coming quarters.

However, the company also reported an increase in overhead expenses during H1 2025. This rise is attributed to the early-stage nature of the real estate development cycle, where costs are incurred upfront, and a significant investment in digital transformation to modernize systems and address legacy technology gaps.

As part of its debt management strategy, Union Properties announced its intention to repay AED 150 million in bank debt. While AED 20 million was repaid before the quarter's end, the remaining AED 130 million is scheduled for repayment in Q3 2025, contingent on the timing of cash receipts.

A key highlight of Q2 was the signing of a conditional sale agreement worth AED 700 million for a major real estate asset in Motor City. This landmark transaction is expected to further strengthen the company's financial position and support its growth trajectory.

Given the company's strong financial performance, strategic investments, and promising future prospects, investors might consider a buy recommendation. Union Properties' focus on operational efficiency, digital transformation, and debt management positions it well for sustained growth in the competitive real estate market.