Al Reem Real Estate Register Transition to the ADGM on 1 January 2025

Clients will be aware that Al Reem Island came under the jurisdiction of the Abu Dhabi Global Market (“ADGM”) in April 2023. As part of this transition, the real estate register for Al Reem Island properties will be transferred from the Abu Dhabi Municipality (“ADM”) to the ADGM Registration Authority (“RA“). This transition is scheduled to take place on 1 January 2025. The ADGM RA and ADM, having entered into a memorandum of understanding (“MOU”) in September 2024 to facilitate this process, are working towards the implementation date.

On this date, all real estate interests will be transferred to the ADGM’s land register, including corresponding mortgages currently registered with the ADM. Land interests will be governed by the ADGM’s new Real Property Regulations 2024 (the “Regulations”), introduced in October 2024. Among other provisions, the Regulations include transitional arrangements to account for property interests on Al Reem Island previously registered with the ADM. The priority of such interests will be determined based on the date they were registered with the ADM.

It is important to note that the ADGM Registrar will rely on records provided by the ADM and will not independently verify their accuracy. Interested parties (e.g., mortgagees and mortgagors) will have six months from the date of registration to notify the ADGM Registrar of any errors or discrepancies. Consequently, a prompt review of records is essential to ensure that no discrepancies arise during the transition. Mortgage enforcement will continue to take place in ADGM courts, as has been the case since Al Reem Island’s incorporation into the ADGM.

For the registration of new mortgages, the requirements set out in the Regulations must be met. These include providing a sufficient description of the property in question, the interest to be mortgaged, the secured debt or liability, and the maturity date of such debt or liability. There is no prescribed form for ADGM mortgages. Banks may wish to adopt new mortgage templates and lending documents, as Al Reem Island is now a common law jurisdiction. Existing templates designed for UAE civil law transactions may no longer be appropriate. Furthermore, the ADGM offers a wider variety of land interests than onshore UAE (e.g., legal mortgages, equitable mortgages, easements, caveats, etc.).

With the 1 January 2025 deadline fast approaching, it is vital for banks to review their processes and take the necessary steps to ensure that their mortgages are properly transferred.

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How can we help?

At Al Tamimi & Company, we are uniquely positioned to support banks and other stakeholders in navigating the transition of Al Reem Island’s real estate register to the ADGM. For more information or assistance, please reach out to our key contacts.