Structured Finance Division
	INVESTMENT STRATEGY

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Shari'ah Compliant Leasing

Wafra was a pioneer in Islamic structured products when it began offering innovative Shari’ah compliant leasing products to its clients approximately 11 years ago. Wafra continues to be a leader today through strong partnerships with notable international institutional investors, and established U.S. lease originators. Wafra’s Structured Finance Division has structured, implemented and managed over 30 leasing programs, separated into 2 distinct risk profiles:  

(i) Ijara leasing funds: seek to provide investors with reliable and attractive monthly returns by investing selectively in transactions believed by Wafra to be conservative. The Funds typically select high quality lessees, with a particular focus on Fortune 1000 companies and companies that are deemed by Wafra to be of high credit quality  

(ii) Structured leasing funds: seek to provide investors with attractive and reliable returns by investing in equipment leasing transactions primarily with U.S. growth companies. Lessees may include venture funded and other emerging companies. The Funds will seek to enhance lessee credit through structured transactions that may include attributes such as advance rentals, third party guarantees, manufacturer support, and other credit enhancements. The Funds also seek to invest in equipment with predictable residual values, large secondary markets, or other attractive remarketing factors.  

Both types of leasing funds are designed to offer investors attractive annual yields (paid monthly) well above like term Treasuries. Since inception and including the current recession, Wafra’s leasing funds are continuing to meet targets with an impeccable record over the past 11 years of zero defaults to investors of either principal or return.

Over the past year, the Structured Leasing team has successfully structured and launched a new and innovative product that is unprecedented in the market place. To date, Wafra has launched 3 KWD Ijara funds whose fixed yields are denominated in Kuwaiti Dinar while the underlying leases are U.S. Dollar denominated assets. The funds make investments in U.S. Dollars but their distributions are denominated in Kuwaiti Dinar. The Funds engage in Islamic Swap transactions to facilitate the distributions of lease yield and principal to investors in KWD.

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Shari'ah Compliant Real Estate

The Structured Finance Division is a global real estate asset manager for a number of Gulf-based clients. Since 2004, the group has established 4 international real estate funds with targeted investments in Asia, Europe, and Turkey/Middle East North Africa. In addition, the group manages one fund that invests in international REIT securities, considered to be the first Shari’ah compliant real estate securities fund of its kind. Of the approximately $3.5 billion equity presently under management in Islamically structured products, in excess of $2.4 billion is in the real estate arena.  

The real estate funds target a diverse array of potential investments, varying in their investment strategies, products and geographic allocations to ensure that we are capturing the most effective risk/return profile for our clients. Our strategies include investing in high quality, income oriented, value added assets in a range of properties, including office, warehouse, retail and residential, as well as ground-up development projects in both developed and emerging markets. Our experienced team, in conjunction with our local partners including Pramerica, Landmark and CITIC, has managed or co-managed complex co-investments and direct investments in property funds and underlying properties as well as mezzanine financing deals. Our expertise in structuring each deal in a tax-efficient and Shari’ah-compliant manner has made us pioneers in the space.

 

Wafra Investment Advisory Group, Inc.
345 Park Avenue, 41st Floor New York, New York 10154-0101