Increased jobs can help recovery of UAE realty market

Creation of more jobs will help in recovery of property market in the UAE, said a real estate expert.
According to Head of Research – MENA at Jones Lang LaSalle (JLL), Craig Plumb, creation of more jobs holds the key to recovery of real estate markets of Dubai and Abu Dhabi.

Craig points out that real estate prices have already stabilized in preferred locations in Dubai, such as Arabian Ranches, Palm Jumeirah, and the Lakes, while the decline in prices in Abu Dhabi, will be more than in Dubai, with more supplies entering the market.

The residential sector in Dubai is close to bottoming out, while few locations are already seeing increase in prices and rents. This year, more sectors are likely to see recovery, although this may not be a universal phenomenon.

According to the third quarter report of 2011 by JLL, Dubai will get an additional 25,000 new units this year, while in Abu Dhabi there will be 20,000 new units. There may be a drop in these numbers due to delays.

The office market, however, is still in a downturn phase. Rents and prices have stabilized only in best quality buildings. The tenants have more choice of projects, and this implies that rents and prices are likely to decline in all, but, only the best buildings in 2012.

The third quarter report of 2011 by JLL estimates that nearly 1,000,000 square meters of fresh supply will enter the Dubai and Abu Dhabi markets. Abu Dhabi will get nearly 500,000 square meters of office space. However, not all these spaces will be delivered, as projects continue to meet delays, owing to issues such as construction, contractual and permit issues.

Residential property prices in Dubai, set to bottom out in 2012

The declining residential property prices will finally bottom-out this year, although, the real revival wont’ begin until 2013.

Predicting the future of property sector in Dubai, the global property consultant Jones Lang LaSalle (JLL), said that although the residential owners can heave a sigh of relief, the poorly managed projects or those isolation from other infrastructure, will pull back the desired properties and will not allow them from rebounding, the experts said.

The residential sector in Dubai is close to bottoming out, with prices already on the increase in major locations, said Head of Research – MENA at JLL, Craig Plumb.

This year, recovery in individual projects may happen, while the year 2013 will be the recovery year for the whole market. The year 2012 may be a good year for tenants, as office rents may continue to decline, JLL said. This may benefit UAE in its competition with neighbours, for attracting international firms.

However, other forecast trends seem less positive. JLL expects hotel earnings in Abu Dhabi to face pressure, with the launch of new properties.

Plumb has called on lawmakers to keep a closer look on initiatives such as amendments to terms of property visa, so as to ensure they are followed up after announcement.

UAE property sector may see profitability in 2012

The realty sector in UAE is likely to return to profitability this year, with the corporate sector all set for sustained growth, say analysts.

According to the latest report released by Markaz (Kuwait Financial Centre) on “What to expect in 2012?”, the corporate earnings have rebounded in UAE during 2011, following the considerable loss suffered in 2010. The sector will moderate to 23percent growth this year, with the banks likely to record a 26percent growth, and telecoms all set to grow by 6 percent, as against a 14 percent decline recorded earlier. 

Overall, the UAE economy will depict a 3.8percent growth in 2012, following a 3.3percent growth in 2011. Although the analysts adopted a neutral view of the GCC markets due to lacklustre liquidity and activity, they expressed positivity on Qatar and Saudi Arabian markets, given, their earning potential, market liquidity and positive economic growth prospects.

In 2012, the UAE corporate earnings will touch 23 percent, while Kuwait and Saudi Arabia will show a 19 percent growth each. According to Markaz analysts, the budget for 2012 in Dubai, makes it evident that conservatism and cautiousness is the way to move ahead. 

Revenues are expected at the rate of $8.3bn during the coming year in Dubai, majority of which will be from service charges and fee. However, the emirate still struggles with a debt of $15bn, particularly due to Dubai World and Dubai Holding. 

The Dubai property sector, while bottoming out, will continue to fight oversupply issues, with residential prices likely to decline by 15percent, as supply continues to surpass demand. Meanwhile, the supply-demand imbalances will also continue to dampen prices in Abu Dhabi, the report said.

Brisk start for UAE realty market in 2012

Leading real estate specialist, Cluttons, has predicted the real estate trends across residential and commercial sectors across the UAE in 2012.    Their report states that the residential market in the UAE will continue to mature, And will see increased demand.

Residential

Cluttons has predicted a brisk start for the year 2012, with the trends in the residential market in the UAE likely to continue, with good quality and well-established developments being benefitted immensely due to their amenities and services. They are likely to do well at the expense of newer residential areas. Cluttons also anticipates that the residential market in the UAE will continue to gain from readily available mortgage finance options at competitive rates.

Commercial

An improvement in demand is expected in the commercial sector too. However, the rents are likely to bottom out in the commercial sector, with minimal further reductions.

Cluttons expects an improvement in occupier demand in 2012 with several companies seeking to re-locate into the UAE. This trend could possibly be due to Arab Spring, and due to the perception of Dubai being a safe haven for business.

The general oversupply of office stock in the market place, coupled with availability of low rentals will continue to fuel occupier movement within the city. Several companies are going through rigid cost-saving and downsizing measures, with particular focus on reducing rents and vacant floor space, which is no longer needed, Cluttons said.

The oversupply of office stock will continue in 2012. Although there are indications about the bottoming out of rentals, further reductions may be minimal, it is said.

Park Towers bags World's Best award

The ‘Park Towers’ at Dubai International Financial Centre (DIFC) has won the title of ‘World’s Best’ in the ‘Best Mixed-Use Development’ category at the International Property Awards in London.

The Park Towers development bags this title at the International Property Awards, after having received five honours at the Arabian Property Awards last month.

These awards indicate that the company’s strategic approach to sustainable development has been the right course of action in a challenging market, said Niall McLoughlin, Senior Vice President, Damac Properties.
The architectural-design is the noteworthy aspect of this great architectural build. The twin elliptical shaped towers change their shapes as they rise, with no two floor plates being the same. The towers expand from the base, with maximum floor plates achieved at the mid-point, before receding until they reach the crest.
The external facade of the towers comprise triangular, solar-glass, energy-reducing panels, of various sizes. The string of internationally-recognized awards received this year, confirms the position of the company as one of the leading regional developers, and is one of the most highly-regarded in the world, said McLoughlin.

Damac earlier bagged a gold five-star Arabian Property Award for ‘Best High-Rise Architecture’ for luxury Al Jawaharah tower in Saudi Arabia. During the year 2010, the developer also bagged an International Property Award for ‘Best High Rise Architecture’ for its first Versace-branded residential Damac Tower.

Meraas to introduce movie-based theme park in Dubai

Meraas, a Dubai-based real estate company, has launched a new Dh.2.2bn project to build Dubai Adventure Studios, a movie-based theme park, located in proximity to its master development close to the Arabian Ranches intersection.

The Dubai Adventure Studios, which occupies across two million square foot of space, forms phase-one of the three-phase project, spread across eight million square feet of space. The work on the project is scheduled to begin early next year and will be ready by end of 2014.

The Chief Business Development Officer at Meraas Holding, Sina Al Kazim, said that Meraas will complement the growing popularity of Dubai as a tourism hub. Further, the Dubai Adventure Studios will offer a truly unique experience that will set a distinctive benchmark in the theme park industry.

The movie-based theme park will include five zones featuring the best in technology games and new generation rides, apart from hospitality and F&B zones to shape an excellent entertainment destination that meets the requirements of the visitors.      

Dubai Adventure Studios will take centre-stage at Meraas stand in the 2012 Arabian Travel Market Exhibition, to be held from 30th April to 3rd May 2012 at the Dubai International Convention and Exhibition Centre.

DMC launches 6 new mixed-use Business Districts

The Dubai Maritime City (DMC) this week launched six new mixed-use Business Districts, further strengthening the position of Dubai as leading global maritime hub. The launch was held under the patronage of HH Sheikh Ahmed Bin Saeed Al Maktoum, Chairman of Dubai World.

The grand inaugural launch ceremony held at the 227-hectare man-made peninsula of DMC, located between the Drydocks World and Port Rashid, involved participation of Director General of HH the Ruler’s Court, Khamis Juma Buamim, Chairman Drydocks and Maritime World, senior company executives, representatives of developers, government officials and special invitees.

Work will commence on six new projects in the Business District, following the launch. Among the new projects are Swiftships Towers by Swift Development, Sheth Developers with the Project ‘Iris Mist’ Hotel Apartments and Residences, Kensington Krystal by Kensington Global, Sanali Aquamarine Residential Apartments by Sanali Global, and Dubai Investments Real Estate with a six star hotel.   Project mobilization and commencement of construction will begin towards end of 2012.

The Dh.2.5bn worth Business District, spread across 121 hectares of land, is located at the heart of the visionary DMC project, and complements the Marine Industrial District Operation, unveiled earlier this year. It will serve as the main business growth engine of DMC, accounting for nearly 90percent of its projected total income in 2013. It comprises a maritime centre, a marina, an academic quarter, a hotel and harbour offices and residences.

Among the nineteen renowned developers being considered to handle the development and sale of commercial and residential units within the Business District are Al Burj Real Estate, Swift Development, Kensington, Global Investment Inc, Sanali Global Limited, Sheth Estate International Limited, Deyaar Development – PJSC, ETA Star Property Developers LLC, Omniyat Properties Eighteen Ltd., Al Faraa Investment, Mena Capital Investment, Vakson Freehold, Hemen R E D & General Trading Limited, Meyadeen, Dubai Investment Real Estate, Mohammed Shafar, Das Holding, Esam Janahi, Ismail Janahi, and DAMAC.

DMC is the first maritime group in the world, with an integrated development comprising residential, commercial, industrial, academic, and lifestyle components. It is specifically meant to improve the maritime industry and serve as a unique place for maritime community to work, live and play.

The first phase of DMC was completed in March this year. The 106-hectare Marine District, comprising 96 units of various sizes has been constructed and considered operationally fit. Majority of them have already been occupied by major maritime companies. The phase 2 involves additional infrastructure, while phase 3 will involve completion of all commercial aspects too, by 2014. On completion, there will be more offices, showrooms, shops, warehouses, and yacht building yards.

The shipyards in DMC will have the capacity to handle a range of vessels including handling tugs, medium size tankers, diving support vessels, bulk carriers, offshore supply vessels, landing crafts, navy vessels, tugs and barges and yachts.

New system to complete property title deed formalities in 45 minutes

The Dubai Land Department (DLD) has now launched an online appointment system, wherein the registered brokers need not queue up at the department office for registering a property transfer.

This comes as good news to more than 2000 registered property brokers in Dubai. The registered brokers can now fill up details of the property such as name, address, value of the deal etc., pertaining to the buyer online, and can use it to complete the property transfer.

The Title deeds can now be issued within 45 minutes, a senior DLD official revealed.

About two to three transactions have been already registered using the new system. The department is now seeking all registered brokers to use this new system.

The Assistant Director-General of Land Department, Mohammed Sultan Thani, explained that when the agent registers on the system, and feeds in the details of the transactions, he will be given a set time. This will help save their time, and permit to complete the transaction process at a faster pace.

However, the system is not yet open to individuals. They will have to make personal appearance after fixing an appointment, for their transactions.

2011 ends on a positive note for Dubai property market

The commercial property sector in Dubai is picking up, with increased occupier interest, owing to various cost savings now available in what is considered to be a buyers’ market.

Leading real estate services company, Cluttons, in its review of property activity in Dubai last year, mentioned that high-end residential sector seems to be benefitting from the current capital shifts in the region, due to Arab Spring.

The year 2011 seems to end on a positive note for Dubai property market, than during the past three years, despite the negativity arising from the current economic turmoil in Europe and US, the report said.

Although the prices have continued to fall in certain places, the rate of decrease seems to have slowed down throughout the year, indicating that they are close to bottoming out. A general maturing of the marketplace has been noticed in 2011, with demand now originating from variables that one would expect in any established city, Cluttons point out.

The landlords are also getting more flexible in their terms which seem to be another feature of a maturing property market, it said.

Further, a major announcement that came over the past 12 months, that of three-year residency visas to owners holding Dh.1mn or more worth of properties in all freehold areas, lured investors back to the market, Cluttons said.

The Head of Cluttons, UAE, Steven Morgan, said that it seems encouraging to note the stabilization seen in certain areas of the UAE residential and commercial real estate market.

Cluttons has expanded its team so that their combined skills and expertise can help the company in retaining the international best practices and professionalism, while also continuing to adapt the ever-evolving Middle Eastern marketplace.

Dubai realty market to see steady apartment, villa rentals in 2012

The villas and apartments in Dubai are likely to see marginal decline in prices during the forthcoming year, with nearly 10,700 new apartments and 1300 villas entering the market during the first six months, says Asteco Property Management, the leading Dubai-based real estate consultancy.

The real estate market in Dubai will be strengthened further, by buyers from other Arab countries, owing to regional unrest and economic uncertainty in other parts of the region, thereby boosting Dubai’s safe haven status.

During the year 2012, villa and apartment rentals in Dubai will remain steady, with only minor declines seen for low quality and poorly managed buildings in certain localities.

The H2 2011 report by Asteco shows that there will be increased number of transactions, with further supply entering the market, leading to increased price competition for owners, while the tenants are offered better choice. However, the report notes that the demand is likely to continue in 2012.

The fourth quarter of 2011 shows that Dubai realty market continues to remain steady for the fourth successive quarter, and with increased transactions, indicating that the Dubai property market is actually recovering, the consultancy points out.

Asteco reports that apartment rentals in prime and mid-market locations stabilized over the fourth quarter, with Nakheel’s International City, being the only project to see a small slide in lease rates. Asteco also reports that there are increased numbers of people re-locating to the emirate, owing to general growth in business performance.

The rental rates for apartments stabilized over the end of 2011, which dropped marginally in the first six months, with International City being the only development to have witnessed minor declines in the fourth quarter.

The average annual rental for a single bedroom unit in Dubai Marina during fourth quarter was Dh.62,500 with double bedroom apartments being sold for Dh.80,000. Rentals for single and double bedroom units on Palm Jumeirah were Dh.90,000 and Dh.120,000 respectively.

The villa rentals were comparatively stable throughout the year. According to Asteco, transactions in the rental market for both categories picked up, as tenants took advantage of lower rates and moved into better quality accommodations, while people relocated to Dubai from other emirates.

Locations such as Discovery Gardens, Dubai Marina, Jumeirah Lake Towers, Sheikh Zayed Road, Downtown Dubai, Palm Jumeirah, Emirates Living and Arabian Ranches, continued to have huge demand.
The selling prices of apartments also maintained their levels in the fourth quarter, following slight declines in the first nine months of the year, although new areas or unfinished developments witnessed further falls.