Wednesday, September 30, 2009

Dubai office rents slide 63 percent, likely to fall further

The rentals for office space in Dubai have dropped by 63 percent during the past nine months, but prices are likely to fall further for the reminder of the year and in 2010, as a dearth in demand has been noticed, along with abundance of new supply, which will keep the office space leasing market sluggish, particularly the free zone areas, reports CB Richard Eliis (CBRE)-Middle East, the leading property consulting company.

Average rentals at the Jumeirah Lake Tower area have dropped to Dh.70 to Dh.120 per square feet from Dh.240 to Dh.280 during the third quarter last year.

Office space from private developers in Dubai Silicon Oasis now averages between Dh.50 per square feet and Dh.85 to Dh.130 in Dubai Internet City, Jebel Ali Freezone, Media City, and Airport Free zone. No comparative figures have been provided.

The global economic crunch has badly hit the real estate market in Dubai, with the prices having halved from their peak values in September 2008, hitting both residential and office space sectors.

The large expatriate population in Dubai that fuelled the five-year property boom, dwindled this year, with thousands losing their jobs and being sent back home as the companies cut down operations.

The office space leasing market will have to witness more tough times, as the current stock will face stiff competition from new supplies coming on stream. The office space available in third quarter this year has more than doubled, touching 5.2mn square feet from the 2.5mn square feet space during third quarter last year, said Faheem, Research Analyst at CBRE Middle East.

During the rest of the year and in 2010, the leasing market in these areas will continue to remain sluggish, largely due to additional pipeline stock expected to enter from free zone developments and non-free zone areas such as Business Bay development.

Tameer's Silver Tower to be ready by 2010

Silver Tower Tameer
The exclusive 31-storey Silver Tower by Tameer, located at Business Bay is making good progress and has crossed 22 storeys, and the superstructure is almost ready, it has been announced.

The company officials have confirmed the delivery of the project next year.

The development is making good progress and the construction has crossed 60 percent mark sometime ago. According to sources in Tameer, the slab for 26th storey has been done, and the core wall has to reach 28th floor.

Standing at a height of 148 meters, the tower, with its silver aluminum fa├žade and ultra-smart glass architecture, is all set to be one of the leading landmarks in Dubai.

On completion, the Silver Tower will comprise 260 offices of various sizes, which includes all of Dubai's leading landmarks. On completion, the building will offer office spaces, health clubs, 748 private parking spaces, retail and commercial outlets, cafeteria, and more, spread across a total area of 700,000 square feet.
Ideally located at Business Bay, Silver Tower offers residents easy access to Sheikh Zayed Road, Dubai Airport, Burj Dubai Downtown, Dubai Internet City, Jebel Ali Free Zone and Dubai Media City.

Monday, September 28, 2009

Rakeen completes overhaul of Bab Al Bahr model units

One of the leading property developers and master planners in the region, Rakeen, has completed comprehensive overhaul of model apartments for Bab Al Bahr.

The model single bedroom and double bedroom units, located along the main road, at the entrance to Al Marjan Island, have amenities similar to that of actual apartments and have been built overlooking the coastline of Arabian Gulf, giving a realistic foretaste of the views of Bab Al Bahr residences.

The units are value-added offering that gives clients a glance of actual features, amenities and layout and ambience of their dream homes, a senior official revealed.

Rakeen has invited investors and buyers to visit the newly revamped model units to have a clear view of the properties on offer at Bab Al Bahr. The Bab Al Bahr units are a mix of Arabic culture and tradition.

Bab Al Bahr is the first end-user development of Rakeen and its flagship project on the peninsula of Al Marjan Island, the first man-made island in RAK.

The Commercial Director of Rakeen, Jeremy Savory, said that the Bab Al Bahr model units have been designed to redefine living in Ras Al Khaimah, and add value to emirate's community.

"While also awaiting the much-anticipated handover during second half of 2010, we are inviting interested buyers to visit the model units to generate unique ideas for physical arrangements and additional furnishings they wish to include in their residences," he said.

Bab Al Bahr is a residential development offering a relaxed atmosphere with its exclusive beachfront location and stunning views, and serves as a new landmark in the emirate.

Nakheel and Emaar confirm participation in Cityscape Show

The two leading Dubai developers, Nakheel and Emaar Properties, have mentioned that they will participate in the much-anticipated property expo, the Cityscape Show, thereby reversing their earlier decision to pull put.

The leading property developers known for their major projects such as man-made islands and world’s tallest skyscraper had earlier cancelled their participation in the show, which illustrated a shift in focus amidst the real estate bust towards completing existing projects, rather than rolling out new ones.

In their statements to the media, the companies mentioned that they will participate in the two-day property fair, due to begin in Dubai on 5th October.

The decision follows discussions with several agencies involved in organizing the event. The company will make use of the event to explain its growth strategy of expansion and further explore new possibilities in the Middle East, North Africa and South Asia, says the statement by Emaar.

Meanwhile, Nakheel has stated that the company decided to participate following discussions with several industry stakeholders, including partners and leading event organizers.

The company's focus will remain on delivering units and services to existing investors and focus on exhibiting communal properties on several of its developments nearing completion, Nakheel mentioned in its statement.

Organized by IIR Middle East, the Cityscape Dubai 2009 will be held between the 5th and 8th October 2009 at the Dubai International Exhibition Center.

Sunday, September 27, 2009

Ajman's Crown Residencia project comes to halt

Investors in Crown Residencia project in Emirates City in Ajman will have to wait for a minimum of one year, before moving in, reports The Gulf News.

According to Abu Bakr Abuzeid, the Finance Manager of Al Batha Real Estate, the project developer, the project has been stalled as investors are yet to pay their installments.

Abuzeid agreed that people are delaying their payments, and mentioned that the company will have to swap its clients to Dubai, and has already offered projects in Dubai.

According to ARRA (Ajman Real Estate Regulatory Agency), Crown Residencia does not have an escrow account and one of the partners of Al Batha Real Estate has been jailed for bounced cheques.

The investors met Abuzeid last week and they were told that their investments could be swapped to projects in Dubai, through a new partnership with Al Masah International Development Company.

As per this potential solution, investors' money will be put into an escrow account and registered with Dubai's RERA (Real Estate Regulatory Authority).

Abuzeid has emphasized that Crown Residencia has not been cancelled. In case investors don’t accept this offer, they will be offered another solution. The company just needs to pay the balance of land and some other fee, worth Dh.1.5mn, and requires Dh.1million to pay construction advance.

But, the investors who spoke to Al Masah International realized that as per the current plan, they would lose 70 percent of their investment, with only 30 percent being transferred.

A source at Al Masah International confirmed that clients from Al Batha will be able to shift investments to their projects in Dubai. The cheapest of Al Masah projects is worth about Dh.750 per square foot, so investors can pay more, as units in Ajman are usually cheaper.

Al Batha Real Estate is different from Al Batha Group in Sharjah.

Friday, September 25, 2009

Dubai preferred over Abu Dhabi due to lowering rentals?

Although the demand for residential properties in Abu Dhabi is still strong, due to insufficient supply, the impact of lower rent rates in Dubai, could lead to a supply-driven market condition, with more residents opting for Dubai over Abu Dhabi, points out the latest report by EFG-Hermes about UAE property sector.

The difference in rent rates between Dubai and other emirates, particularly Abu Dhabi, has led to considerable cross-emirate migration. At present, several residents and businesses are taking advantage of the low-cost environment in Dubai and moving into the emirate from the Capital, mainly for convenience or lifestyle reasons. If this trend continues, it is likely to exert a downward pressure on prices and rents in Abu Dhabi, narrowing the differential and changing the overall outlook, the report points out.

However EFG-Hermes report emphasizes that the end-user demand is likely to pick-up in Abu Dhabi. This is owing to greater availability of mortgage financing, and a short-to-medium term supply-demand mismatch, coupled with structured pace of development and a shift towards better economic liberalization.

The Managing Director at Jones Lang LaSalle (JLL), Blair Hagkull, who spoke about the EFG Hermes report, said that the fundamentals in Abu Dhabi property market will remain positive in the long run. However, at present there is a marked difference in the cost of residential and office accommodation in Dubai and Abu Dhabi. While the prices in Dubai appear moderate, the value proposition for residential users in Abu Dhabi continues to remain challenging.

However, the rental rates to be charged in future, could be lower than what was anticipated, the report concludes.

Dubai developers to get realistic and focus on affordable segments

Signs of internal migration are likely to appear in Dubai, with several affordable properties on the offer and a more realistic approach adopted by developers.

The property prices in Dubai have already undergone correction by about 50 percent, ever-since the peak transactions witnessed in 2008.

The Executive Director of Dubai Property Society (DPS), Adel Lootah, when speaking to the media, mentioned that there would be an internal migration of people within Dubai, to better-located and more affordable localities in future.

Transactional activities at the moment are more focused on completion of prime properties, either due to the location or a good developer.

The latest report by EFG-Hermes showed that property consolidation, which offers investors the option to transfer deposits from an early-stage project to an almost complete one, is also in the happening.

With the Cityscape Dubai, due to be held next month, the message to developers in future is to be more realistic and build mid-income properties.

The DPS Chairman, Ahmad Thani Al Matroushi, mentioned that with the drop in prices, people would begin moving from Sharjah and Abu Dhabi, to places like new Dubai, as it is only half-an-hour away from Abu Dhabi, and this will generate more demand and take care of the excess supply in the market.

The average price of Dubai Villa in January was about Dh.1600 per square foot, and that of apartments were about Dh.2100 per square foot, but by August, they had dropped to Dh.1250 and Dh.1650 respectively.

Developers will take a cue from this, and will focus more on affordable properties. When the city gets expensive, it creates lot of issues. Now Dubai will seem more attractive, as people can live in a nice place with an affordable rent, he adds.

Affordable housing should also be made applicable to tenants, as there have been positive signs in Dubai's rental market, including lowering of rents, and moving away from the unrealistic single-cheque payment.

With the Cityscape just two weeks away, it is often considered as a litmus test to gauge the state of property market. This year, particularly, may be true, as it is unlikely to be the hub of sales activity that it was. No region has been immune to the worldwide recession, and therefore, a strong element of realism has entered the real estate investment landscape, says Chris Speller, Cityscape Group Director.

Tuesday, September 22, 2009

Dubai most attractive for Foreign Direct Investments

The UAE has been an important center of attraction for world investment in various sectors, pointed out Hani Alhamli, Secretary-General of Dubai Economic Council.

He emphasized that latest figures in the country, recorded in various fields are great achievements during these times of global economic crisis.

This statement came to light during the newly launched World Investment Report 2009 by the UNCTAD. The report states that UAE has maintained its attractiveness in Foreign Direct Investments (FDI), compared to several other advanced and emerging markets.

UAE's experience over the last years in economic development reveals the strategic vision of the wise leadership of UAE in enhancing the growth path through global and regional integration.

Attracting FDI is one of the main policies adopted by the government, due to its advantages for local economy such as increasing investments and hence the growth rate, increase in employment rate, and transferring the technology and know-how to the country, Alhamli said.

He also mentioned that Dubai has made a significant contribution in attracting FDIs to the UAE, due to its distinguished place in the regional and global business map.

The World Investment Report 2009 showed that the volume of FDI inflow into the UAE were $13.7bn in 2008, compared to $14.19bn in 2007. On the other hand, the report indicated that the cumulative value of these investments at the end of 2008 stood at $69.42bn, around 25 percent of UAE's GDP.

Alhamli said that the report shows distinct development pertaining to FDI inflow. The number of projects executed by foreign investors in the UAE last year was 480 in number, marking an impressive growth rate of 70 percent, compared to that in 2007. During the first half of this year, there are a total of 136 projects. This reflects the strong foundation of the national economy and its highly competitive advantage, in comparison to several other countries.

Friday, September 18, 2009

Abu Dhabi's economic strength is Dubai's commercial gain

The dropping rental prices in Dubai offers much respite for expatriates, seeking to escape from the high prices in Abu Dhabi, and helps in luring back residents who had fled to the northern emirates in search of cheaper accommodation last year, reveal experts.

The economic strength of Abu Dhabi has come to Dubai's aid, not only at the federal level, but at residential level, too. Abu Dhabi's infrastructural development, high prices, coupled with shortage of supply, have all led to more people moving in to New Dubai, much to the commercial benefit of Dubai, says Mohammed Nimer, CEO, MAG Group Property Development.
Initially, the growing rental prices in Dubai had forced expats to move out to places like Ajman, Sharjah, and Ras Al Khaimah, but now, with the sharp fall in prices, they are tempted to come back, Nimer said.

Single bedroom apartments in the Jumeirah Lake Towers or Dubai Marina, are now renting out for Dh.60,000 to Dh.70,000, which is a distinct Dh.30,000 less than last year. Therefore, it is not surprising that these localities have become more appealing to mid-income budget groups.

Meanwhile, the Leasing sales still continue to tick in Dubai. The Director-Commercial Division at Better Homes, David Macadam, revealed that the company has seen 400 leases in Dubai in May, compared to 200 to 300 per month in 2008. One-third of these are new entries from Europe, UK and the US, who were mostly mid-level managers, while another one-third were from outside emirates and a third were residents who were shifting internally with drop in prices.

Most important, the real estate sector in Dubai is showing strong signs about residential sales gaining momentum, and is drawing more genuine buyers, rather than speculators of previous years.

However, in the opinion of Nimer, the general picture will be lot clear after Ramadan. At present, Dubai and Abu Dhabi has gained momentum, although there are few projects that stuttered in recent months, although the ripple effect will be felt mostly in the outlying Emirates.

Even in the northern emirates, it is clear that several projects are being radically modified owing to investor worries surrounding power supplies. The projects are met with uncertainty, and these cannot fall back on leases with real confidence, while there are negotiable rents in several areas of Dubai, Nimer concluded.

Established in 1978, the MAG Group has grown into a multinational organization with 18 offices in eight countries including Middle East, Asia and Europe.

Dubai property sector last in road to recovery

Although the real estate sector is the first in the country to fuel to the recent economic growth in the country, it is also probably the last in the recovery wheel, said senior government officials.

The Dubai Police Chief, Lt. Gen. Dahi Khalfan Tamim, said that the recovery path of the real estate sector is very slow and will not happen before end of 2010.

According to Tamim, greed and irresponsibility, coupled with aggressive lending by banks are the main causes of the economic downturn.

"These investing companies focus only on setting up companies and begin collecting profits and do not care about anything else," he added.

Tamim explained that several of the UAE companies lack risk-management mechanism, and hence, they failed to manage the downturn.

The Director-General of Department of Economic Development, Sami Al Qamzi, said that this is a year of challenges and hence it is very difficult to pinpoint a time for recovery. However, the property sector may not start recovery process before end of 2010. But, the growth in retail sector, which constitutes 38 percent of UAE economy, has already begun and is very fast.

He explained that 30 percent of real estate market is real, while 70 percent is speculation. But with the market correction, majority of market will turn real. After 2006, the economic growth in GCC and particularly in real estate sector has been unrealistic. There are several projects and the market requires time to absorb them. The real estate sector will be at the end of the recovery path.

With the support of government coupled with good management, economic recovery will happen, although at a slow pace, he added.

Dubai Government officials too, blamed bankers for the current economic crisis, and said that their aggressive and irresponsible lending has led to the present economic situation.

The wrong policies adopted by banks are the main cause for the growing economic slowdown, which in turn, affected several related sectors, and among them real estate sector was the first, they concluded.

Thursday, September 17, 2009

DPG announces leasing of villas in Shorooq

Dubai Properties Group (DPG), a member of Dubai Holding, has announced that it would begin leasing a diverse section of spacious villas in Shorooq.

Located in the heart of Mirdiff, the new development is one of the most sought-after communities for families in the emirate.

Shorooq is a unique alternative to high-rise living, offering families the security of a high-end community, away from the hustle-bustle of the city.

Shorooq is easily accessible from arterial highways Al Khail Road and Emirates Road, and is conveniently located adjacent to Rashidiya Metro Station, and the Dubai International Airport. The family-friendly development also offers easy access to schools, shopping centers, including the popular Uptown Mirdiff and the new Mirdiff City Center Mall.

The delivery of Shorooq units meets considerable requirement for affordable, family-sized units and offers a range of leasing options, said Khalid Al Malik, CEO of Dubai Properties Group.

There are about 350 villas that are now available for lease, including three-bedroom and four-bedroom villas. The introductory promotional packages will be offered during initial stages of leasing.

The Dubai Properties Group is currently leasing out residential and commercial units at Cordoba Villas, Jumeirah Beach Residence, Al Khail Gate, Al Razi Residence, Al Waha, and the Office Park at Dubai Internet City.

The Group has also announced plans to showcase its landmark developments due for handover during this year's Cityscape Dubai 2009, to be held at the Dubai International Convention and Exhibition Center between 5th and 8th October.

Among the projects to be featured are The Executive Towers, Vision Towers, Shorooq, Al Waha and The Villa.

Sunday, September 13, 2009

Emaar unveils Ramadan Package for Downtown Burj Dubai units

Emaar Properties PJSC, the leading global property developer has come out with a special Ramadan package of competitively priced apartments with flexi-purchase options and unique benefits, including upto one year waivers on maintenance fees for developments in the prestigious Downtown Burj Dubai.

The potential customers get to benefit from the easy mortgages of up to Dh.2.5million on a range of studios to triple bedroom apartments in the most sought-after destinations in the city.

This sales initiative for completed residential units in The Old Town Island, Burj Views, and South Ridge and The Residences, will all be established communities with an array of lifestyle amenities.

Several units that are unique and new to the market, are on the offer, with almost all of them having an easy access to various attractions in the city, including The Dubai Mall, the world's largest shopping and entertainment destination, and the world’s tallest performing fountain, The Dubai Fountain. They are also in proximity to the Burj Dubai, the world's tallest building, and the Emaar Boulevard, a vibrant leisure and cultural avenue.

Emaar has also announced special attractive offer for Rent to Own customers, who convert to ownership towards end of September. This scheme was unveiled by the company last year, which offers customers with a chance to rent a home for a period of one year, and then apply their rent to purchase of their home.

The mortgages consultants of the company, Emaar Square Sales Center are offering free consultancy to clients interested on the offer.

The homes vary in floor plans and sizes, offering wonderful views of Downtown Burj Dubai's lifestyle attractions. While The Old Town and Old Town Island offer traditional Arabian architecture in a modern setting with low-rise homes with courtyards, the South Ridge, The Residences and Burj Views, are modern high-rises with large terraces and amenities, including health and fitness and swimming pools.

Potential customers visit the Emaar Square Sales Center for details.

Friday, September 11, 2009

Dubai Metro likely to command 10 percent hike on rents

The prices of properties adjacent to Dubai Metro stations can command an increase in rent of up to 10 percent, as the mass transit system draws more people off the roads.

People seeking homes, will no-doubt take into consideration the proximity and convenience to public transport, as the city moves away from its dependency on private vehicles.

Rents across Dubai have already seen a marginal rise, but the possible impact of Metro is still speculative, say industry analysts.

Any increase in rental could be further tempered by the RERA (Real Estate Regulatory Agency) watchdog, which at present does not factor Metro stations in its rental price index.

The Director of Research and Advisory Services at Landmark, said that the impact on prices has been marginal, so far, due to the uncertainty in the market and anticipated Metro usage patterns at the outset and about how usage patterns evolve over time.

On an average a 5 to 10 percent increase in premium can be expected during the first two years of operation, depending on the residential location and specifics of the development or individual buildings, the Director said.

As for the Metro commuters, the office location will be a critical factor. Few popular localities are getting highly congested with limited parking space. The Metro will be advantageous to residents living or working in such localities.

The actual Metro use and its impact on property prices will also depend on unknown factors such as Salik. For instance, if Salik fares increase, this could trigger more widespread use of Metro and then prices would be adjusted accordingly.

The Metro is likely to have an impact on commercial prices and rentals too. With increase in use of the Metro, offices with easy access to stations will gain a premium.

For instance, most offices in Sheikh Zayed Road have only limited parking spaces, with several companies or employees having to pay for additional parking spaces. When the companies can see how proximity to a Metro station can help save them their employees both money and hassle, preferences will emerge, resulting in premium.

However, RERA keepts tab on rents, and irrespective of the location of the property, the rents have to fall within the range. Properties located close to the Metro may be priced towards the higher end of the range, but will not go beyond a limit.

The landlords in particular, need to be very cautious before increasing rentals, as they would be violating the law set forth by the government. All these factors need to be considered by landlords and industry specialists before any hike in prices before the Metro gets fully functional, the analysts point out.

Wednesday, September 09, 2009

Dubai all set to build world's tallest residential tower

Following a brief period of lull, the skyscraper deals have once again gathered momentum in Dubai.

The latest one in this direction is the awarding of USD400million contract to Arabian Construction Company (ACC) by Trident International Holding, to build the world's tallest residential tower, namely the Pentominium in Dubai Marina.

According to the developer, the 124 storey Pentominium will be one of the tallest man-made structures and is hoped to the second tallest building in the world, after Burj Dubai. Each apartment in the 618meters tower will cover either half a floor or an entire floor.

The total built-up area of the tower will be 170,000 square meters and the duration of construction is hoped to take 48 months, revealed a company statement.

The Pentominium will be the tallest all-residential building in the world on completion, and is currently the highest project among any residential building under construction, said Aedas, the project designers.

The Executive Director and CEO of Trident International Holdings, Wazir Daredia, said that the Pentominium is a unique project that raises the concept of luxury living to new standards and with the construction major ACC, the project has gained an exquisite bouquet of brand partnerships for the development.

Activity is gradually picking up pace in the construction sector. The ACC deal follows the $187mn contract in Dubai awarded on 25th August to UAE's contractor Arabtec, of which, the Samsung Engineering and Construction forms a part of the team working on the Burj Dubai.

ACC has a backlog of 54bn worth of projects in the Middle East and is currently working on 10 projects worth Dh.5.8bn in Dubai.

Property auctions still struggling to gain foothold in UAE

Several UAE properties are being sold through auctions, and will continue to be sold that way, during the following months, as the sellers struggle to find buyers, reveals a real estate brokerage firm.

The Dubai-based Harbor Real Estate reveals that with the property auctions gathering pace, several sellers are competing for sale and are struggling to find buyers.

The Managing Director of the company, Mohanad Al wadiya, says that auctions are a more efficient way of making a sale, as it will eliminate lengthy negotiation and transaction periods.

"The primary advantage of an auction is that it is competitive, well-regulated, fair and transparent," he adds.

Although property auctions are a common feature in developed markets, it is comparatively a new trend in Dubai. So far are only three property auctions being done since June this year, although none of them registered a sale.

The first brokerage firm to hold property auctions was the Madania with two auctions done so far, and another property company called Sherwoods, has hosted one. High expectations from sellers and bottom fishing buyers have been the stumbling block for its success.

In a recent auction by Madania, a four bedroom villa in Meadows was bid forDh.3.35mn well below the reserve price. However, the firm sold the same for Dh.4.2mn using the traditional way of negotiation to a buyer from India, who did not participate in the auction.

Meanwhile, Sherwoods, in its first auction, had to reduce the number of properties on offer from 50 to 20, as the sellers began to withdraw from the auction, dis-agreeing the price recommended by the company.

This has led to lesser numbers of bidders, with cash on hand floating around for bargains. With conventional auctions flopping, a British reverse auction website, humraaz.com, is trying to sell a four-bedroom apartment in the Green Community for just Dh.300.

In these reverse auctions, the lowest unique bidder wins. However, even this type of auction is yet to attract sufficient participants.

Monday, September 07, 2009

Nakheel offers consolidation option to investors on deferred projects

Nakheel, the real estate arm of Dubai World, has offered an investor with an option of consolidating his investments in The World, for plots in Jumeirah Village, Palm Jumeirah, or the Marina Residence Properties.

The Dubai-based developer and broker, Silver Heights, revealed that Nakheel has offered replacement properties, worth about Dh.26million, in exchange for its investment in The World Island.

The Managing Director of Silver Heights, Samir Ahmed Munshi, said after purchasing the Dh.153m worth Island 86 in The World, by paying an initial 15 percent down payment on the land, which totally amounts to Dh.23million, the company then decided to withdraw its investment, due to the real estate sector slump.

But, Nakheel asked Silver Heights to pay an additional Dh.3mn and offered plots on Jumeirah Village, Palm Jumeirah or the Marina Residence, Samir Munshi said.

Munshi revealed that he has decided to take over four plots on the Palm Jumeirah as replacement.

Silver Heights had initially planned construction of 150 residential apartments, and water homes on the island spreading across 460,000 square feet in area.

The World comprises 300 islands shaped in the form of world's continents, created off the coast of Dubai hoped to add another 232kms along the Dubai coastline.

According to Nakheel, land reclamation on The World, has been completed in 2008. Reclamation of the original 300 islands on The World was completed last January, after which, the masterplan was revised to include the concept design of individual projects that seek to merge islands. About 33 islands have been handed over so far, and initial ground works have commenced.

Nakheel confirmed to the press that it is offering the investors a consolidation on their projects that have been deferred by Nakheel. The investors in deferred projects are given the option of consolidation, if they own other properties within the Nakheel portfolio. The consolidation option is only open to owners, and is non-transferable and non-transactional. Those agreeing to this, will have to sign a new contract with Nakheel. The investors therefore can gain ownership of the property more quickly than in a deferred project, while also getting their financial burden reduced.

Nakheel also agreed that customers can resell their properties, under the condition that all outstanding payments due to Nakheel as per the contract are settled completely.

Nakheel also clarified that the Dubai Waterfront development has not been cancelled and work is continuing at good pace and that the first phase of Badrah and Vento will be handed over next year.

Sunday, September 06, 2009

Rakeen appointed as custodian of La Hoya Bay project

Rakeen, the development arm of RAKIA (Ras Al Khaimah Investment Authority), has taken charge of one of the largest property developments in RAK (Ras Al Khaimah), from its insolvent owner, Khoie Properties, much to the relief of several hundreds of investors in the project.

Rakeen, yesterday announced that it would ensure that the rights of investors in the US$800mn worth La Hoya Bay project, will be protected.

Rakeen has been appointed as custodian of Khoie Properties, under the directives issued by the RAK Court. This is considered one of the significant steps in promoting and protecting the interest of property buyers and investors, pointed out Dr Khater Massaad, Chief Executive of RAKIA.

This move by RAK is also one of the best instances of the government intervention in a failed developer, while the property sector is grappling to overcome the steep price declines and growing defaults among investors. It is also for the first time, that a court has intervened to appoint a judicial custodian for a major developer in the country.

This move will place the company under the control of Rakeen. This move follows the imprisonment of former chief executive of Khoie Properties for writing two bounced cheques worth Dh.57m each to RAKIA.

RAKIA had appealed to the court, urging that Khoie Properties be brought under judicial custodianship, until completion of La Hoya Bay project by a competent developer.

The project comprises seven residential towers and 1400 residential apartments. It is a high-priority project, and is one of the major components of first phase of developments on Al Marjan Island.

Khoie Properties has already received 30 percent down-payment from several investors, worth Dh.280m, and the balance was originally due to be paid on completion.

According to the new payment plan, investors will have to pay only the remaining 70 percent. Also, 50 percent of the balance could be paid in five installments with 20 percent to be paid at the time of delivery.

Rakeen will also help investors in obtaining mortgages to minimize the risk of buyers defaulting and to ensure that the project goes ahead, despite the tight credit conditions.

The investors, meanwhile, have expressed their gratitude to Rakeen and RAKIA for all their efforts in making the project a success, and are keen on knowing if their contracts would be transferred to Rakeen.

Saturday, September 05, 2009

Work on Dubai Lifestyle City makes steady progress

Although other projects in Dubailand have met with delays, Dubai Lifestyle City is making good progress, given its comparatively small and manageable size, points out Rahman.

The pipe work is currently being done the water and electricity sub-stations and roads are nearing completion. The residential portion of the development will be named 'JW Marriott Residences', due to their partnership with Marriott.

Mariott will be installing sprinklers in the residences, although in the opinion of Dubai Municipality it is not a necessity for villas or apartments, said Raza Siddiqui, Executive Director of the company.

There will be 68 villas with five different types ranging from 10,000 square feet to 20,000 square feet built-up area.

Each villa theme is given names inline with the Tuscan theme of the project. On the whole, there will be 120 regular, duplex and penthouse apartments, the construction contract, of which, has already been handed over to Saleh Constructions.

Spreading across 4million square feet of land, the project is developed by the ETA Star Group. Construction will begin on the JW Marriott and IMG Academies this month, with the entire project due for completion towards end of 2012.

Despite the global economic turmoil having had a considerable impact on Dubai property sector, it includes easing of property prices and rents.

Rahman revealed that about 50 percent of residential units have been sold till date. The average price of a villa is between Dh.20 to Dh.40million, while that for an apartment is Dh.5million to Dh.8million.

Apart from hotels and residences, the city will include IMG Academies including tennis academy, golf academy, seven swimming pools, an Olympic sized pool, dive pool, leisure pool and separate pool for women and children.

The place also includes office space, small retail center, a large greenhouse, and auditorium, said Rahman.

Wednesday, September 02, 2009

Payment reduction scheme limited to Remraam project

The "prompt payment reduction" scheme, wherein a 30 percent discount on purchase price was announced by Mizin, is limited to phase two investors of Remraam project, and the offer may not be available for other Mizin developments, a company official clarified.

The payment reduction offer was well received among investors, and they had been appreciative of the company's efforts to assist them during the time of crisis, said an official from the Dubai Properties Group (DPG).

Investors in phase one have already paid an attractive price for their property, and therefore, only phase two investors are eligible for discount, and particularly for investors in Remraam project, he clarified.

Launched two weeks back, the reduction scheme aims to assist Remraam investors during the current economic scenario.

Several developers in Dubai have already offered discounts or prompt payment incentives to investors. In January, Union Properties announced its 10 percent reduction to buyers willing to settle their balance prior to due date. Even Nakheel had announced a "prompt payment scheme" for five of its projects, permitting investors to save up to 30 percent.

According to officials, all of Arjan, Liwan, Remraama and Marjan units that were available for sale have been sold. The official confirmed that all the property projects are in adherence with Real Estate Regulatory Agency (RERA) requirements and the funds are maintained in escrow accounts.

Earlier during the month, the developer mentioned that construction work at the Remraam community is progressing as scheduled, and the progress will be achieved on all four phases of the development. The contractors have completed the superstructure on several buildings to their full heights. About 90 percent of excavation works has also been completed, while the foundation for more than 70 percent of the buildings has also been done.

On completion, the Arabian-themed development will be a self-sufficient community with lush landscapes covering more than 85 percent of the development, and a range of amenities including a gymnasium, swimming pool, health club, steam rooms and sauna, basketball courts, community mall with entertainment outlets and restaurants, in addition to nursery, retail outlets, parks and walkways.

Tuesday, September 01, 2009

Dubai is first in Gulf to launch Lock Box System to ease realty sales

Dubai is now the first city in the Gulf region to launch the world-famous Lock Box System, aimed to introduce advancement to the real estate brokerage business in the UAE.

The system, one of the most popular products in the US and in the rest of the world, was introduced by Centurion Lock Box Systems in Dubai last week.

The product, GE Supra Real Estate Lock Box System, enables real estate agents to access several properties and streamline the process of showing properties for clients without hassle.

The system solves several challenges that real estate agents face when showing properties. Agents would no longer lose sales, as they can access any property easily and conveniently, said Usman Ghani, Managing Director, Centurion Lock Box Systems.

It also enables agents to show more properties as they won't have to hunt for keys or wait for someone to grant them access, Ghani said.

Centurion, the authorized GE Dealer for this system in the country, will offer training to brokers as the product is being introduced for the first time.

Despite the slowdown in real estate sector owing to global economic crisis, Ghani expressed confidence that his company will achieve the preliminary target set for the sale of the newly introduced system in the country.

Few leading brokers in Dubai have already placed orders for 1000 systems and the firm is confident about selling about 5000 systems per year.

On achieving good sales in UAE, the company plans to introduce the system to other Gulf States too.

The GE Supra lock box system has been of much use by several real estate brokers and agents in the US and in the rest of the world for several years now.

The ease and rugged reliability that the system offers, has made it the most used lock box system in the world. Currently there are about three million Supra Lock Boxes in use. With about 50,000 new property units likely to arrive in the market within next two years, this system is hoped to facilitate the brokers in dispose of these units quickly, agrees Ali H. Zaidi, CEO, Centurion Real Estate Brokers.

The salient features of the product are email notifications, Display Key, Supra iBox, USB cradle/charger connected to the Internet.