Tuesday, June 30, 2009

Dubai property prices beginning to witness the Metro effect

The prices of properties located close to metro stations in Dubai are already beginning to rise, marking the first signs of a Metro effect on the property market, reported analysts in Dubai.

The Jumeirah Lakes Towers (JLT) on Sheikh Zayed Road, located directly opposite the Dubai Marina station are being sold for 6.5 percent more than units in buildings located further away. The difference in prices could equate to tens of thousands of dirhams, pointed out a Dubai-based real estate agency.

Several other agencies have also reported to have been receiving enquiries about properties located in proximity to the metro stations. The trend implies that with just three months left for the opening of Metro's Red Line, home buyers are already beginning to take into consideration the ease of transport when choosing their home.

In the rental market, few mentioned that there was a clear difference in values, which would probably emerge only after the lines open on September 9th. Several residents feared that landlords would take advantage of the locations in proximity to the Metro and raise rents.

The Sales Director at Landmark Properties, Michael, mentioned that units at Indigo Tower, a JLT building near the station, was going for around Dh.800 per square foot, compared to Dh.750 across similar-quality buildings in JLT.

The Head of Property Management at the Dubai-based property portal Gowealthy. com, Andrew Delport, mentioned that units in proximity to the Metro will be the first to recover, once the system was up and running.

Delport considers Dubai Marina to have a similar trend, with the Metro on the Marina side of the freeway. The tenancies are more vibrant here than in other places, offering good value for money.

Dubai Marina is the most popular area for leasing, accounting for 30 percent of new annual lease contracts in Dubai, according to the second quarter 2009 report by Landmark Advisory.

A sales consultant for powerhousedubai.com, Ian Hainey, mentioned that estate agents have been keen to highlight any available access to the Metro. However, so far there has been no drastic difference in rents between properties near the Metro and others. The uncertainty would last until it is known which stations would exactly open on September 9th, and that would have an impact on decision-marking of prospective tenants.

Cayan's Infinity Tower at Dubai Marina makes steady progress

The leading real estate developers in the region, Cayan Investment and Development, mentioned that its Infinity Tower development at the Dubai Marina, has hastened its construction process and has achieved a major progress on site.

The 80-storey tower offers stunning view of Dubai Marina. The podium levels, comprising six storeys are complete. Arabtec has been appointed as the main contractor of the project, with over 1000 workers in the site, working round-the-clock to ensure the right construction schedule.

The progress is an indication of the impressive track record by Cayan Investment and Development on keeping up with their project schedules, and the dedication by Arabtec towards the project.

The Chairman of Cayan, Ahmad Al Hatti, when speaking about the project construction, mentioned that the progress made on construction of the project reflects the meticulous care that Cayan lends to every aspect of its projects.

On completion, the tower will offer world-class amenities and offer tenants with a vast array of unique services and state-of-the-art amenities.

The construction work has now reached the seventh storey within the past six months. The development has already received a total of six design awards over the past three years, including the International Architecture Award from ‘Chicago Athenaeum’.

In December 2008, Cayan delivered 4 out of its seven projects in Dubai, and hopes to deliver the rest three projects between 2010 and 2011. Apart from projects in Dubai, Cayan has few mega projects in Egypt and Jeddah.

Sunday, June 28, 2009

Commercial property prices will continue to decline globally

Commercial property prices will continue to plunge this year in the global market, and will not bounce back until next year, according to the DTZ Money into Property report 2009.

The report, which was launched yesterday at the Ritz-Carlton Bahrain hotel and Spa last night, revealed that the number of global investments have fallen by 85 percent from their peak during the third quarter of 2007, till the present day.

The report, which includes 38 countries worldwide, offers detailed review about the trends and performances of the global property investment markets during the past year.

According to the report, commercial property prices will fall once more, as they continue to decline globally throughout this year, and will stabilize only next year. The London City office market will be the only key office market, globally, to offer investors attractive returns at current values.

DTZ also predicts that globally, total office returns will be about minus 20 percent this year, and will be zero or slightly positive next year, going to above 10 percent from 2011 onwards.

Being first published in 1975, Money into Property is the longest running annual report of its kind, providing detailed breakdown of the property investment markets globally, considering the different sources of capital, debt and investor interest.

Having already made its presence in six GCC countries, DTZ is currently undergoing aggressive expansion, across the region, offering complete range of real estate services, staffed with qualified expatriates and experienced nationals.

Saturday, June 27, 2009

Dubai World announces consolidation of operations

Dubai World yesterday announced that all operational management, pertaining to real estate activities of few of its companies, are being consolidated for better accommodation of market conditions and to maximize resources and expertise.

The real estate development and property transactions of Dubai Maritime City, Dubai Multi-Commodities Center and Leisurecorp will be managed by Nakheel. The changes, however, will have no impact on the daily business of the companies.

The consolidation planning is on currently, with assistance from Consultants, Alix Partners, and the process will be completed during summer.

Dubai World, the major player in real estate businesses in Dubai and across the world, has invigorated the industry, re-defining whatever possible through its companies' efforts and dedication.

Dubai World, in its statement, mentioned that it is extremely proud of its achievements, and aims to continue to be a leader in real estate business and hopes that the current decisions will help in meeting the requirements of customers in a better manner.

Dubai World is Dubai government's investment flag bearer, with a portfolio comprising the world's most renowned companies such as DP World, Drydocks World & Dubai Maritime City, Nakheel, Leisurecorp, Economic Zones World and Istithmar World.

Emaar, Dubai Holdings under consolidation talks

As per the statement issued by the Dubai Government Media Office, four large development firms in Dubai - Emaar Properties PJSC, Sama Dubai LLC, Dubai Properties LLC and Tatweer LLC, have come together to hold one of the larges banks in Dubai, and have begun discussions to join together and form a larger entity, intended to rise up to the current challenges and to transform Dubai into a global city.

The proposed consolidation, when implemented, would create the biggest developer ever, in the MENA and Asian regions.

Dubai Properties, Sama Dubai and Tatweer are a part of Dubai Holdings, the investment arm of Dubai Government, while Emaar Properties, is on the verge of completing Burj Dubai, the world's tallest tower, 32.5 percent of which, is owned by the Dubai Government. Emaar also finds its listing in Dubai Financial Market.

The proposed consolidation of these leading real estate units will mark the beginning of a new chapter in the annals of global real estate, apart from building on the remarkable achievements in Dubai during the past thirty years.

The Royal Bank of Scotland PLC is the Advisor of Emaar Properties, while Merrill Lynch International represents the interests of Dubai Holdings.

The statement revealed that the firms are almost finalizing the proposed consolidation, including valuation of various entities, and assessment of potential transaction structures. Discussions are also on with the respective regulatory authorities, the statement said.

The Chairman of Dubai Holdings, Mohammad Al Gergawi, mentioned that consolidating these companies with Emaar is a natural progression towards evolution of Dubai real estate landscape, offering benefits to all stakeholders.

By clubbing forces, the largest combined entity will be given an unparalleled platform to maximize the opportunities in local and international markets. The combined entity has a clear strategy to better the positioning of Dubai as a world-leading hub in property development and management.

The Chairman of Emaar, Mohammad Ali Al Abbar, mentioned that there could be exceptional synergies between Dubai Holdings and Emaar's major real estate businesses. These comprehensive discussions are driven by shared vision regarding the consolidation of our respective visible success stories till date and the aim by the companies for creation of a world-class group, ideally positioned to help and support the current development of Dubai as a world-leading hub.

Thursday, June 25, 2009

Dubai heading towards stability in home rents

There are indications of rent stabilization in Dubai, with few landlords still experiencing good demand for higher quality rented homes in prime locations, a leading property consultancy reveals.

Landmark Advisory Group, one of the leading real estate consultancy companies in the region, yesterday released its sales and leasing price maps for the Dubai market.

The Dubai price maps, continues to show evidence of 180 degree turnaround from the earlier supply-driven property market to a demand-driven property market, although, on an average, the consultancy hopes to see further decrease in Dubai rents for the third quarter of the year.

The latest price maps from the consultancy, indicate the distressed sale opportunities have largely been exhausted, as sellers are reluctant to lower existing prices, and buyers sometimes are even paying increased rates for their sought-after residential developments, as only limited homes are available.

According to Director of Research, Jesse Downs, at Landmark Advisory, the Dubai property market shows distinct signs of market stabilizations, and return of confidence from end-users. In a few cases, even the sales prices have increased. This is mainly due to the dynamics of each development.

Small villa developments with limited supply have tapped into sufficient value recognition among end-users with regard to location, layout, and amenities and build quality. These are among those residential developments experiencing increases in prices, such as the Green Community and the Jumeirah Islands. A similar trend is also seen in leasing rates for few villa communities.

However, the price lists indicate a steep decline in apartment prices. The economic downturn, together with large quantity of high-rise apartments that were completed last year, has resulted in over-supply in this sector.

A noteworthy element in the price maps by Landmark Advisory is the constant refinement of price differentiation, which was earlier based on factors such as location, view and quality of finish.

Off-late consumer decision making is based on factors such as environment. Those in proximity to high voltage power lines are going for lower rates, than similar units located away from power sources.

Wednesday, June 24, 2009

Nakheel presents revised budget for Discovery Gardens community

Leading Dubai-based property developer, Nakheel, has established a revised budget for its Discovery Gardens community following detailed review of suppliers and scope.

The new price has been arrived upon, together with Dubai's RERA (Real Estate Regulatory Authority), and gives a reduction of Dh.5 per square foot in service charges for homeowners.

The Managing Director of Nakheel Asset Management and Design (NAMAD), Abdulrahman Kalantar, mentioned that initially when the service charges were set for Discovery Gardens, it was based on the best estimates. Thereafter, after a long review, the company has taken advantage of recent reductions in the cost of goods and serviced and has made this reduction in overall service charge budgets.

The new low service charge rates will be back-dated to 1st January 2009, and any rebates will be credited against next year's service charges, effective 1st October 2009.

Following introduction of Strata Law in April 2008, Nakheel made required preparations to register the Owners Association with RERA, once the regulations are finalized by the Dubai Land Department (DLD).

Tuesday, June 23, 2009

Al Barakah places new option before property investors

Al Barakah, the real estate developer, who has been much in the new off-late for allegedly bouncing cheques worth more than Dh.40mn, has now requested its investors to drop all their claims against the company, and in return, the CEO has promised shares fin a new holding company.

The proposal was circulated by the company to all its investors, and advertisements were placed in local newspapers, inviting the investors to submit claims to Horwath MAK, an auditing company in Dubai.

According to Tariq Minhaj, an Al Barakah representative, the company is now planning to build its long-delayed projects, with a UK-based construction company.

Several hundreds of investors suffered losses after investing on off-plan properties in about half a dozen towers that are yet to see the light of the day. The investors were lured by the guaranteed buy-back scheme, wherein the company had pledged to re-acquire its properties within few months after sale, with a 50 percent profit on the down-payment.

Few of the investors were given post-dated cheques as a guarantee, while few others were given only MoUs (Memorandum of Understandings). Once the cheques began bouncing, the Chief Executive of the company, Imran Khan went hiding, and now the police is in search of him.

Al Barakah has a dozen projects on the drawing board in Dubai and Ajman, including the 'tallest tower to-be' in Ajman.

Saturday, June 20, 2009

DCCI strongly backs 100 percent foreign ownership of businesses

The Dubai Chamber of Commerce and Industry (DCCI) has strongly supported the plan to allow foreign investors 100 percent ownership of locally-based companies in certain sectors of the economy.

At present foreigners should have UAE national as a sponsor, and are given the right to own only 49 percent of the company, if they wish to begin business outside the designated free zones.

The business group supports the amendments of proposed companies' law, in few economic sectors, with big investments and high technology that adds value to UAE economy, said Hamad Buamim, the Director General of DCCI yesterday.

The Government has been considering the revision of Companies Law for more than two years now. It has been pressurized from the Europe and the USA to permit greater foreign ownership of companies, based in the UAE.

According to analysts, such a move could benefit the economy and attract more investments, although, foreign investments in already established free zones could become pressurized.

The Director at Dubai's Arqaam Capital, Ali Khan, said that it is potentially good for the economy, but the free zones might feel pressured, as they need to attract investments too.

Abu Dhabi issues decree to monitor issue of plots, low-cost housing

The Crown Prince and Deputy Supreme Commander of the UAE Armed Forces, Gen. Shaikh Mohammad bin Zayed al Nahyan, has passed a decree, wherein a Committee has been formed to monitor the distribution of plots and distribution of low-budget housing for UAE nationals, and how to put the properties into good use.

The legislation is inline with the directives by the President H.H. Shaikh Khalifa bin Zayed al Nahyan, who empowers the Committee, under the Chairmanship of Director General of Abu Dhabi Crown Prince's Office, to act accordingly to ensure reasonable distribution of houses and plots.

The Committee can propose necessary legislation required to regulate the distribution of houses and land, and how they could be put to good use.

It will also study issues pertaining to housing and draw necessary plans to solve any housing-related issues, and follow-up implementation of land and housing-related legislations and find out any possible causes that pose hindrance to the smooth implementation of the programme.

The Chairman of Abu Dhabi Executive Council, Shaikh Mohammad, issued another decree establishing Abu Dhabi Center for Housing and Development of Utility Services. This center aims to improve standards of implementation of projects, ensuring that they meet the highest engineering standards. The center will also collaborate with the private sector to implement construction plans.

Another decree has been issued by Shaikh Mohammed wherein certain decisions made by the Eastern Region Development have been amended.

The Abu Dhabi Crown Prince also passed a decree on safety, health and environment management system.

Friday, June 19, 2009

Al Reef Villas most popular among mid-income group

According to The Specialists, a provider for total property solutions, Al Reef Villas in Abu Dhabi which include residential properties for mid-income sector, are one of the most popular offerings.
The projected demand of about 100,000 housing units in Abu Dhabi continues to be driven by a major supply gap in the mid-income level.

With residential properties being much in demand in Abu Dhabi, the investor interest continues to remain strong. The Specialists have begun offering units from Al Reef Villas in the market.

The General Manager of The Specialists, Sobhi Agha, agreed that the company has received huge numbers of bookings and reservations on a daily basis for properties within the integrated development project.

The Specialists recently entered into a contract with developer Manazel Real Estate, to offer a complete range of real estate solutions, including leasing, sales, and property management services for Al Reef Villas in the Capital.

Al Reef Villas are the first planned community in the UAE, exclusively for the middle class. The villas offer an integrated environment with a range of lifestyle options, all in a single location. Located in proximity to the Al Raha Beach, the villas come in four themes - Desert, Mediterranean, Arabic and Contemporary. The housing complex also includes several modern apartments in various styles.

Among the various amenities in Al Reef Villas are verdant public parks, lush landscaped gardens, swimming pools, health clubs, retail area, mosque, educational facilities, medical clinic, 24-hour concierge, and high-tech equipment to secure all properties.

The Specialists offers a comprehensive range of services, covering all aspects of property transactions in commercial and residential markets, either for sale or for lease. The company also offers property management services to several of its clients in the UAE. It is also planning expansion across other major markets in the Middle East, including Lebanon.

Thursday, June 18, 2009

ETA announces hand-over of Liberty House units

Liberty house Dubai
ETA Star Property Developers has begun hand-over of its Dh.700mn Liberty House units in the Dubai International Financial Center (DIFC).

The L-shaped building has 140 offices, 124 studios, 68 single bedroom and 28 double bedroom apartments. The studios are worth over Dh.1million, which the single bedroom apartments are worth about Dh.1.6mn.

The residential units have been furnished as a 'goodwill' gesture, due to the delay of three months, said Vijay Chugh, Senior General Manager - Projects, ETA Star.

Although there has been a slight adjustment in prices, DIFC continues to be one of the most stable areas in Dubai, in terms of rental rates and prices. There is also the 'retail tunnel' being developed here, which is likely to connect The Gate at DIFC to a leading city mall. All the buildings in the DIFC area will be directly linked to the tunnel.

The Executive Director of ETA Star, Abid Junaid, mentioned that about Dh.1.5bn worth of company projects would be delivered this year.

ETA is going ahead with all its launched projects. Business sentiment is getting more positive and is reflected in terms of increase in transaction volumes, he said.

Currently the prices are bottoming out, and towards the last quarter of this year, a recovery is expected in terms of prices and volume. Increase in prices and volume, would be inter-dependent on each other, he added.

Wednesday, June 17, 2009

Time ripe for long-term investors to re-enter UAE realty market

With the local and global banks re-entering the mortgage lending market, it is evident that UAE property market is re-gaining confidence of the financial sector, and few analysts believe that this may be the right time for long-term investors to re-enter the market.

James Gauduchon, the Manager-Corporate Marketing at Better Homes, a real estate company, said that confidence is re-entering the market, and it looks like the property market has begun heading upwards again.

The Head of Retail at the Dubai Bank, Mohammed Amiri, said that the classic pattern for any property market is a slow start upwards, then a period of manic buying, followed by slowdown and standstill. The market then changes direction, and prices would begin to head downwards, before collapsing into a new market bottom, after which, the cycle would move upwards again.

The Chief Executive Officer - Personal Financial Services, HSBC - Middle East and North Africa, Abdulfattah Sharaf, said that with the ease in lending and the attractive prices offered by the housing environment in the UAE, more end-users are grabbing the opportunity to own a home.

Following a 30 to 40 percent drop, the initial signs of stabilization in Dubai real estate sector have appeared, taking observers by a surprise, said Phillippe Dauba Pantanacce, Senior Economist, Standard Chartered Bank.

The volume of distressed stock has gradually diminished. The end of the freefall is an encouraging sign for Dubai and for Abu Dhabi, as it had a direct negative impact on the banking sector with higher defaults and non-performing loans.

Gauduchon said that the residential segment will be the first to recover, and commercial and retail sectors would soonfollow.

However, analysts advised caution, and said a further decline, particularly in few segments of the market, cannot be ruled out. The returns for properties that are away from the desert, will be more than the off-plan projects or those in obscure locations.

On the whole, completed high-quality properties that are competitively priced and in prime locations, will continue to generate more demand and value than others, said Suvo Sarkar, Executive Vice President and General Manager - Retail Banking at Emirates NBD, the region's largest bank in terms of assets.

Traditional real estate near the sea or in the middle of the town will be worth more in the long-term. The next few years, would be the best time for investment for long-term players, he added.

Tuesday, June 16, 2009

Dubai luxury properties shows positive signs after bottoming out

Prices of residential properties even in the best localities in Dubai, had hit the bottom, and are now once-again witnessing an increase of 20 to 40 percent, it has been revealed.

The Managing Director of Harbour Real Estate, Mohanad Al Wadiya, mentioned that recently an increase in activity has been noticed from potential buyers, who intend to purchase luxury properties, as prices are now hitting bottom. Iconic locations such as the Downtown Burj Dubai and The Palm Jumeirah are among the topmost in this revival list.

He revealed that last week, the company sold a single bedroom apartment at Downtown Burj Dubai (with Burj view) for Dh.2.1million, which was going out for Dh.1.7m to Dh.1.8m in December 2008.

The average prices for signature villas on The Palm Jumeirah was in the range of Dh.9mn to Dh.17mn during last December, but currently they are in the range of Dh.12.5m to Dh.19m, Wadiya said.

The Associate Director for Group Seven Properties, Jose I Murcia, said that luxury residential prices have stopped declining, but luxury commercial properties are continuing to slide. Locations such as Downtown Burj Dubai and The Palm Jumeirah are iconic, and with drop in prices, it makes an attractive proposition for buyers.

The Chief Operating Officer of Al Barari, Mohammed Zaal, agreed that prices have fallen in the luxury realty market, but not significantly. The prices have reduced by as little as 20 percent from their peak last year, as most of the demand for properties is from the end-users.

People intending to put money into high-end properties are long-term investors seeking to keep the investments even during recession. Such individuals do not require financial banking, and are willing to put forward anything required even if it means that they will get the level of quality they are looking for in their homes.

Saturday, June 13, 2009

Nurai project on its way towards completion by December 2010

Zaya, the UAE-based real estate developer, plans to deliver on schedule (by December 2010), its Dh.3bn Island project Nurai, which comprises 31 high-end beachfront estates and 36 water villas,

The Chief Executive Officer of Zaya, Nadia Zaal, when speaking to media, mentioned that at present the project is a little ahead of schedule. The number of workers on the project will double over the next couple of months, from the current 200 workers.

The properties that are already sold by Zaya on Nurai are in the range of Dh.55mn to Dh.65mn. About 40 out of 67 units in the projects have already been sold. The top-most unit at Nurai will be sold for nearly Dh.100mn, though it won't be sold before completion of the project, Zaal said.

The owners of units at Nurai can even rent out the units, with service charges per unit rated as Dh.180,000 per year. There will also be a hotel project on Nurai, which would include 45 villas, the work on this will commence on September.

Located four kilometers away from the Saadiyat Island, the entire project management is managed by Zaya Retreats.

Zaal agreed that the Nurai project in terms of development area is 300mn square feet, and the project is financed by a group of banks. On completion, Nurai will have the latest spa, tennis courts, and movie theaters. Nurai is a luxury property known for its privacy.

UAE property prices may decline prior to level-out

Property prices in the UAE may decline by 20 percent and level-out by the end of the year, says a Deutsche Bank report.

The predictions are based on the evidence generated during the past two months that prices in few areas of Dubai and Abu Dhabi have increased. The prices will once again drop, as several expat workers are likely to leave the country during summer, when several new properties hit the market.

Nabil Ahmed and Athmane Benzerrough, an analyst, when speaking about the report, said "We remain cautious, given, the limited number of transactions and the constant declining trend in rents. We expect UAE property prices to drop by another 15 to 20 percent from current levels, and expect a bottom by year-end."

The global financial crisis has so far cut an estimated 50 percent off Dubai property prices, since their peak in August last year, while prices in Abu Dhabi have dropped by 30 percent.

Growing defaults from the end of homeowners are one of the prime concerns facing developers over the past couple of months. But, there are signs of stabilizations with brokers and bankers stating that prices in few developments in Dubai and Abu Dhabi are on their way to recovery, after the nine-month fall.

In Abu Dhabi, prices for properties nearing completion, such as Al Reem and Raha Beach increased by 10 percent last month, while villas in Al Reef saw a price increase of 5 to 7 percent.

HSBC, in its recent report, also said that prices in Dubai increased 4 percent in April, and another 5 percent last month. The prices of flats, which account for majority of property transaction, are believed to have increased by 9 percent last month, but villas fell by 11 percent.

Thursday, June 11, 2009

DIP announces leasing of boutique offices at Jumeirah

Leading UAE real estate developer, Dubai Investment Properties (DIP), has announced leasing of its boutique offices at the signature Sunset mixed-use development located in the upmarket Jumeirah 3 area.

The office complex, comprising 49 exclusive offices, will feature the latest in technology and offer the best-in-class facilities and amenities, required for making it the ideal for businesses, and companies seeking to establish a business or international representative office in Dubai.

Sunset, the unique development, combining the best in architecture and the latest in green initiatives, comprises luxury shopping mall, lavish residential apartments, and boutique offices.

It is being built in one of the most energy efficient buildings in the region, focusing on energy conservation and minimizing pollution and demands on infrastructure.

The office complex of Sunset includes office units in the range of 1200 to 1800 sq.ft., overlooking the Dubai City or Arabian Gulf and the Jumeirah Road. The Sunset office complex has direct access to the shopping mall and restaurants, and will include two business lobbies, prayer rooms, pantry rooms and conference rooms. Among the other amenities are two patios, parking spaces for tenants and visitors, business services, 24/7 security and cleaning services.

Tenants can also avail of aerobics, gymnasium, steam bath, swimming pools, children pools and beach access, all of which completes the perfect work and play business environment.

Investors choose to walk-out of Ivory Tower project

Foundation work on the long-delayed Ivory Tower in Dubai, which had resumed work six months back, has once again come to a standstill. Several buyers are seen walking away from their investment in the Sukook Group's project, which is already three years overdue.

One of the investor, who spoke to The National clearly said "Why should we pay for an imaginary tower?"

This is another property development in Dubai that focuses on the problems associated with sale of off-plan properties, as buyers are refusing to pay for something that they have already lost faith in, while the developers have no cash to continue construction.

The Director of Sokook Investment Group, Mohammed Binghalib, agreed that he has not drawn a salary for the past nine months. He also agreed the company has trimmed staff and other overheads at the firm, to compensate for limited cash flow.

The company is now trying to get investors to pay 30 percent to cover the cost of foundations work, while the rest can be paid inline with construction. This is as per the new payment plan drawn together with Dubai's RERA this year.

Binghalib says "There are few people who are genuine buyers and make payments regularly, but there are others without property finances, earning may be Dh.10,000 per month, and have bought six apartments. They are now fighting us."

Few purchasers are refusing to abide by the new payment plan, and say that with construction languishing for more than three years, they fear that Ivory Tower will never be built.

According to Binghalib, the delay has been caused by a dispute over land with TECOM, where Ivory Tower is located. The dispute was resolved with the help of Dubai Land Department last summer.

The company's announcement early last year, saying that the contracts with buyers would be cancelled, with 20 percent of sale price retained, took buyers by shock. The buyers even suspected that Sokook was trying to take back the apartments that were sold for up to Dh.650 per sq. ft. to sell them for more.

So far more than 100 buyers are believed to have defaulted on payments, preferring to cut their losses.

Binghalib said that the company requires its customers to fulfil their obligations towards completion of the building, which is now scheduled towards end of 2011.

According to Binghalib, all money collected for the project had been deposited in an escrow account and invested only in the project. The company now aims to try and collect 30 percent from buyers prior to construction.

Tuesday, June 09, 2009

RAK Govt. to take-over La Hoya Bay island property project

The RAK Government has agreed to take-over the Dh.2billion La Hoya Bay island property project, which was under threat due to the collapse of its developer.

The decision came as a relief to several hundreds of investors who had invests all their savings on the flagship project of the Ras Al Khaimah Investment Authority (RAKIA), located on the man-made island, Al Marjan.

The Chief Executive of RAKIA, Khater Massaad, Sheikh Saud bin Saqr, the Crown Prince and Deputy Ruler of RAK, confirmed that the investors will not be put into trouble, and that the project will surely be continued.

The investors had urged the Government to come to their rescue, as the original developer of the project, Khoie Properties, became insolvent and stopped construction. A senior board member of Khoie Properties was imprisoned, as it failed to honour a cheque for Dh.57mn, in favour of the Government to pay for the land on the island.

RAKIA has requested the court to designate an official receiver for Khoie Properties. Another developer would be appointed to complete the first phase of La Hoya Bay, which includes seven residential buildings, comprising seven storeys.

Rakeen, a property arm of the Government, may be designated as the new project manager, as it is also the master developer of the whole island. Once this is done, Rakeen will open an escrow account and award construction of the project to a new company within a month, and the project is also likely to be re-named.

Khoie Properties had already received a 30 percent down-payment from investors, worth Dh.280mn, with the balance due on completion. Now, Rakeen proposes to ask investors to pay another 50 percent of the agreed price in five installments to finance construction, with only 20 percent due on completion. Rakeen said it would absorb any loss of initial downpayment, although it is now unrecoverable. However, Rakia will not take up any liabilities of Khoie Properties.

La Hoya Bay project was planned to be developed in three phases. The second and third phases were themed as Business Village and Regency respectively. The land for the two phases may be sold to other developers, if interested.

This RAK project is another instance which indicates the government intervention on the UAE property market, which has suffered steep price declines and growing defaults during recent months.

[Source The National ]

Monday, June 08, 2009

Al Fajer projects progressing as scheduled

Al Fajer Properties has announced that all its projects are well on track.

According to a recent voluntary construction audit carried out by RERA (Real Estate Regulatory Agency), the results confirm that work on Phase one (Ebony and Ivory towers) is nearly 80 percent complete, while the phase 2 is nearly 15 percent complete, and the work is in progress at present. The Phase 1 is due for handover by the end of this year.

The audit also confirms that Al Fajer has achieved maximum transparency and completely adheres to RERA guidelines.

The President of Al Fajer, Shaikh Maktoum Bin Hasher Al Maktoum, said "During the past several companies followed the brokers and sales agents and did not adhere to good business methodologies, and it was easy to sell properties due to excessive demand. But, today just as is the case of any developed economy, Dubai is returning to fundamentals. "

Companies that strongly focus on management and performance will be able to do well under the present market conditions, Shaikh Maktoum said.

He appreciated RERA in helping to boost investor confidence, and continued that Dubai is well-placed to take advantage of any market recovery, although there are still difficult times for the rest of the year, in store.

"With the introduction of third party construction auditors, RERA and publication of results, RERA is half-way into transforming Dubai property market into a factual, rational one, while also maintaining high level of transparency," he said.

Saturday, June 06, 2009

Property developers in Ajman must complete registration before 1st July

Ajman Real Estate Regulatory Agency (ARRA), has set announced 1st July as the deadline for property developers, who are yet to complete registration procedures with ARRA.

The press statement released by ARRA this week, states that earlier May 1st was the announced deadline for receiving registration applications from developers, and several developers had rushed to complete the registration formalities. However, few developers have are yet to complete registration formalities.

The ARRA Director-General, Omar Barguthi, while mentioning that several developers have not submitted all the required documents to ARRA, clarified that to be a licensed real estate developer as per the amended Amiri decree, all developers who are yet to complete the procedures or are yet to submit the required documents, are advised to take immediate action, failing which, a fine of one hundred thousand dirham per month would be charged.

However, ARRA will take into consideration, the circumstances of developers who failed to register, due to reasons beyond their control. There is plenty of time for such developers to begin from the point where they stopped, and complete the reminder of registration procedures, Barguthi clarified.

Dubai developers announce price reduction, payment-break options

Leading property developer Deyaar is expected to announce a reduction in prices on four of its projects, for the comfort of investors.

Deyaar also announced that about 470 units out of its four projects in the Dubai Silicon Oasis will be handed over this month, which includes Coral, Ruby, Jade and Sapphire Residences.

The officials at the company is hoped to announce a reduction in price schedule for the four projects soon. The buyers will be offered an easy payment plan, which offers five-year payment tenure.

Deyaar plans to deliver a total of 1300 units this year, despite the bad economic situation, said Markus Giebel, Chief Executive of Deyaar. Recently Deyaar delivered about 312 units at its Madison Residency at Tecom Free Zone. Two other projects - Citadel, a commercial tower, and Hamilton Residency, a residential tower are on track for completion towards end of this year.
Deyaar is also focusing on under-served markets, such as middle-income housing. Deyaar is considering five markets in the MENA region as untapped sources of business.

In the meanwhile, Hydra Properties said that it is taking a series of measures to boost investor confidence at its Dh.2bn Hydra Village development at Abu Dhabi.

Among the measures taken by Hydra are plans to offer a payment-break facility to its customers, who make payments on time. The customers of Hydra Village Abu Dhabi need not make payments until beginning of 2010.

However, the CEO of Hydra Properties, Dr. Sulaiman Al Fahim, has ruled out any possibility of buying back units from customers, as the prices offered by Hydra are already 10 percent below original market rates.

Currently a detailed construction progress plan for Hydra Village is in-place, as a part of company's commitment towards investors. The Hydra Village Abu Dhabi project is due for completion by 2011. The Hydra Village Abu Dhabi project, which includes residential villas, is being financed by Reem Finance.

Thursday, June 04, 2009

Tameer Towers makes scheduled progress for hand-over by 2011

Tameer Towers, the iconic project by leading property developer Tameer, also the focal point of The Shams District of Reem Island in Abu Dhabi, is progressing as scheduled and is due for hand-over by 2011.

The enabling works have been successfully completed, and the construction agreement has been signed between Al Rajhi Projects and Construction together with Al-Habtoor Engineering Enterprises.

The 9mn square feet complex includes a signature commercial tower, and four luxury residential towers. The excavation, shoring and piling works are in progress. The enabling works for entire development was completed in December 2008, which marks a significant milestone for timely delivery of the project. Thereafter, pile capping, trimming, concrete blinding, and water proofing works have been undertaken, together with installation of three tower cranes.

The sub-structure works has commenced, and the superstructure works will begin by the end of this year.

Located in the heart of Shams development, on the prestigious Al Reem Island in Abu Dhabi, Tameer Towers is an exceptional landmark, offering an unprecedented, luxurious and exciting lifestyle.

The towers comprise four residential towers, a commercial tower, townhouses and stepped villas, deluxe serviced apartments, a private marina, and vibrant canal promenade, all integrated harmoniously to create the iconic landmark. The towers offer unparalleled scenic views cascading down into the sea on the east side, and the Sorouh Central Park on the west.
The main attraction of Tameer Towers is the 74-storey diamond shaped commercial tower. The tower is split at the base to include the canal and the pedestrian walkway, connecting the Central Park with the sea. Built along the terraces cascading into the marina and canal, each villa has a separate driveway, a private garden and swimming pool and terrace, which offers wonderful sea or park view.

Wednesday, June 03, 2009

Memon Investments embarks on Dh1.3bn green projects

Leading property developer in Dubai, Memon Investments, also a unit of Memon Group of companies has announced that it plans to continue with its planned Dh.1.3bn worth construction of green buildings comprising five new projects at the Jumeirah Village.

The Managing Director of Memon Investments, Ahmed Shaikhani, said that the efforts by the company to implement green projects are a part of the company's commitment towards customers for their support Memon's project.

"By taking these measures, we are increasing the potential of our projects to yield maximum investment returns, while also effectively reducing the ecological footprint, one of the common impacts of rapid advancement of developing economies such as Dubai," said Shaikhani.

Tuesday, June 02, 2009

UAE property sector sees first ray of hope: HSBC Report

The UAE property market has begun to bottom out, with prices beginning to stabilize, but the values are likely to drop further, with more properties entering the market, a HSBC report said.

The property prices in the UAE increased by 4 percent and 5 percent, month-on-month in April and May respectively, but continued to remain below 23 percent from its peak during September 2008.

With growing signs of levelling out of property prices in the UAE, the Gulf markets surged yesterday, with the Doha and Dubai markets recording their biggest gains in months.

Dubai stocks increased their most in more than three months, following the HSBC report that UAE property prices may be stabilizing. Even Qatar property sector received a major boost, with the government’s decision to buy real estate portfolios of local banks.

The Head of UAE Equity Research at HSBC Global Research, David Lepper, said that the market data during April and May have shown a range of positive indicators, such as rise in property prices, the banks loosening their lending criteria and increase in volumes.

Gulf markets have brought in considerable interest from international investors during recent months, as the global emerging markets have sent signals that the recession is easing out.

UAE property prices met with a steep decline in prices from their peak in September last year, with the financial crisis putting a sudden halt to the five-year boom, further contributed by high oil prices and cheap funds.

Even other property markets in the region have witnessed decline, although Dubai has seen 65 percent drop in property prices from its peak in September 2008.

During the next five years, Dubai economy would depend on more sustainable sectors, such as transport, health care and financial services, thereby undergoing a structural shift, said Dr. Omar bin Sulaiman, the DIFC (Dubai International Financial Centre) Governor.

Abu Dhabi also has seen an increase in property transactions during recent months, with more finished properties hitting the market. Several banks, including Barclays and Standard Chartered, have eased their lending requirements, while also increasing their loan-to-value ratios.

Nakheel, DMCC announces merger

The property arm of Dubai Multi-Commodities Centre (DMCC) has entered into merger with Nakheel, one of the largest property developers in the emirate. This is one of the latest mergers from Dubai's property companies, as they restructure their operations to reduce costs.

A Nakheel spokesman revealed that all property-related operations by DMCC have been consolidated with Nakheel to accommodate present market conditions and make maximum use of the resources and expertise. As both the companies are owned by Dubai World, which is owned by Dubai Government, Nakheel will be involved in all projects developed by DMCC.

One of the main real estate projects by DMCC is the Jumeirah Lake Towers, a community office, residential and hotel towers. The Jumeirah Lake Towers will comprise 87 towers on the whole, and is due for completion by 2011.

The DMCC-Nakheel merger is the second to take place this year, among government-backed property developer. Earlier this year, Dubai Holding had merged the admin and back-office functions of Dubai Properties, Sama Dubai and Mizin. More mergers are likely in the real estate sector, as the companies continue to involve in cost-cutting measures, said Robert McKinnon, Head of Research at Al Mal Capital.

With most property developers being cash-strapped, with the banks restricting lending and homebuyers defaulting on payments, the main aim of consolidation is to pool resources to enable firms survive the downtown.

Nakheel had merged a series of its business units to form five entities, during February this year. Developers are of the opinion that such mergers can help them cope with the shrinking number of projects.