Tuesday, August 30, 2011

Properties adjacent Metro stations draw higher rentals

The Dubai Metro station is gaining prominence and is more of a priority for tenants now, commanding 10 to 20 percent more rentals, said the latest report by Asteco, leading real estate services Company in UAE.

With growing numbers of offices and apartment buildings in Dubai, the rates for property leasing are based on a new market dynamics, the report points out.

According to Asteco CEO, Elaine Jones, the rental disparity is more pronounced now, than ever before, with Dubai Metro adding new dynamics to the market.

There have already been sufficient evidences from international markets about a constant growth in values for markets located adjacent to stations with metro lines. For instance, HotProperty.co.uk reported that homes in Central London, locate within five minutes of walking distance of a tube station, are nearly 21percent more expensive than those of similar properties further away. However, the prices do not grow until the stations are officially operational.

In Dubai, leasing prices for a double bedroom apartment locates within walking distance from Mall of Emirates Metro Station is between Dh.60,000 to Dh.65,000 per annum, in comparison to the value of Dh.50,000 to Dh.55,000 for properties situated a few kilometres away from the station.

Similar trend is seen in the case of more upmarket properties with double bedroom apartments near Emirates Towers Metro Stations and DIFC costing anywhere between Dh.110,000 to Dh.130,000 per annum, while properties further away costs Dh.90,000 to Dh.100,000 a year.

A property in Deira will now draw an annual rental of Dh.50,000, while similar property away can be leased for Dh.40,000. This indicates market maturity, Jones said.

The Dubai Metro Green Line will be unveiled on 9th September, and it will have an additional 18 stations, stretching 23kilometers, covering some of the busiest tourist segments along the creek, including business districts, residential areas and ministry offices.

In general, real estate prices are not solely dependent on its geographical location anymore. All properties in Deira or Bur Dubai with immediate access to a metro station can attract similar rates as that of a property in Jumeirah Lake Tower or Business Bay without a metro access, the report pointed out.

Saturday, August 27, 2011

New law prohibits over-crowding of residential units in Abu Dhabi

According to a new law issued by Executive Council in Abu Dhabi, overcrowding of any residential property in the emirate is banned, including labour accommodations.

Several residents in the capital prefer to share accommodations owing to high rentals within the emirate. This new law could make things more difficult for them.

Certain residential units are unsuitable for multiple occupation and therefore cause several problems, including parking and noise levels. They also pose serious health hazards and safety issues due to overload of electrical systems or undue pressure on drainage.

The new law states that any unit which is occupied in excess of its original capacity, and any breach of the health and safety guidelines, can attract fines and potential evacuation of the unit.

The Labour Ministry has established minimum occupancy level for labour accommodations. The International Building Codes which were implemented in Abu Dhabi effective 1st January, also has set certain construction standards, to ensure health and safety of its occupants.

However, more clarity on the new law is awaited, as it does not specifically mention what constitutes a breach. It only gives a general specification about number of occupants of a residential unit depending on area proportion and general morals and ethics as applicable in the state.

More executive regulations are awaited, as it could offer some clarity. A six-month grace period until 15th September has also been given for residents to alter their conditions accordingly. Meanwhile, landlords will have to ensure that their lease deeds require tenants to abide by the occupancy standards.

Friday, August 26, 2011

Champion Towers I will be delivered by 2012

The Champions Tower I (CTI) will be delivered in 2012, confirmed Memon Investments, the leading Dubai-based real estate developer, also a part of Shaikhani Group, leading international conglomerate.

The tower is the first among the four Champion Towers, to be delivered in first quarter of 2012, the company said.

The developer is currently completing its structure and blocking works and is working on the first floor tiling works and windows. The company is also on track to keep up its deadline for other Champions Tower projects and Frankfurt Sports Tower (FST).

The date of completion for CTI II is December 2012, while CTI III and CTI IV will be ready by June 2012 and December 2013 respectively, while the FST will be delivered in June 2013.

Takmeel, the newly launched turnkey services provider of the Shaikhani Group, will offer designing, consultation, value engineering and project management services for CTI.

According to Memon Investments, the awarding of contracts to few of the leading contractors in UAE has played a major role in the fast paced construction of the towers.

CTI is a 15 storey tower, covering total built-up area of 105,133 sq.ft., comprising 135 apartments which includes 49 studios, 50 single bedroom and 50 double bedroom apartments. The tower will also offer easy access to an 18-hole golf course, a cricket stadium, and several sports-oriented academies, football pitches, rugby and a track and field stadium. CTI also includes other modern amenities including spa, communal swimming pool, Jacuzzi, sauna, fully-equipped gymnasium and indoor games room.

RAK Properties adds 214 new villas to Mina Al Arab project

The leading real estate developer in Ras Al Khaimah, RAK Properties, has announced inclusion of another 214 beach front villas to the Precinct Five of its Mina Al Arab project.

The Managing Director and CEO of RAK Properties, Mohamed Sultan Al Qadi, mentioned that this community, which spreads across 900 metres long private beach, brings about a feel of tranquility to its residents, and will prove to be a self-sufficient community in RAK.

These beach front villas which have already been sold to end users, offer a panoramic view of the mountains, beaches and wonderful landscape. Mina Al Arab is also home to a range of themed resorts, designed to meet varied expectations, Al Qadi said.

Thursday, August 25, 2011

Damac announces cash refund option for investors of Palm Springs

Damac Properties has offered the option of cash refund to investors of Palm Springs project in Palm Jebel Ali.

The investors in the project have revealed that Damac has offered them the options of either 70percent cash refund within two weeks or 100percent refund with 25 percent within two weeks, and the rest paid at duration of three years, with 25 percent payment each year.

The Senior Vice President – Corporate Communication, Damac Properties, Niall McLoughlin, revealed that Damac is committed towards working on the Palm Springs in bringing about a closure to this long-pending issue.

Palm Springs was planned to be a 25-storey beachfront development on Palm Jebel Ali. Damac had tried to cancel the project in 2008, but agreed to reinstate due to protestation by investors.

According to RERA’s report last year, the works on this project are yet to begin, and the project plot has not been handed over to the developer. The RERA statement said that the developer is in the process of amalgamating the two plots, and get the new affection plan.

In the month of May this year, RERA cancelled nearly 218 projects. UAE witnessed completion of 129 projects since 2009, and 237 out of 450 projects are likely to be ready any time soon.

Wednesday, August 24, 2011

Nakheel announces mall expansion plans and new shopping centres for Dubai

Nakheel, the leading property developer, has announced major expansion plans including expansion of an existing mall and building two new shopping centres in Dubai.

A deal has been signed with Dar Al-handasah for designing and supervision to include an additional 1.7mn square feet of retail space, together with 5000 parking spaces at its Dragon Mart Mall.

Arif and Bintoak Consulting Architects and Engineers have been assigned the responsibility to design and supervise the building of two community shopping centres at its Jumeirah Park and Discovery Garden projects.

The Shopping Centre at the Jumeirah Park will have the capacity to allocate nearly 50,000 sq. Ft. of space for stores, thereby serving both Jumeirah Park and Jumeirah Island communities. The Discovery Garden will include stores and recreation centre, covering 140,000 sq. Ft. of space, for its Al Furjan development.

Nakheel is restructuring the $13bn debt, following global economic crisis, which led to a decline in property demand in Dubai. The housing prices fell by more than 60percent from their peak during mid-2008, which led to cancellation and delaying of projects.

Nakheel will begin construction of these projects by early 2012.

Saturday, August 20, 2011

Regulation of real estate development necessary in UAE

Lt. Gen. Dhahi Khalfan Tamim, Commander-in-Chief of Dubai Police has suggested caution on real estate development in the emirate, while seeking regulation on new projects.

Speaking during a press meet in Dubai, he said “Real estate should be allowed to slow down. We should calm down construction and introduction of more foreign workers”.

The real estate market in Dubai witnessed a boom period, until the global financial crisis hit the market in 2008, when housing prices and rents fell by more than 50percent in the emirate. Several high profile projects were shelved by developers.

However, aiming to lure more investors, the government came forward offering three-year visas to owners who own more than Dh.1mn worth properties. These visas will have to be renewed every six months. Further, international and local lenders are cutting down mortgage rates to draw in more expatriates.

Friday, August 19, 2011

Northern Emirates record drop in real estate prices

The rentals and real estate prices in the Northern Emirates are continuing to fall owing to an oversupplied Dubai property market and due to uncertainty over future recovery, said CBRE (CB Richard Ellis), a real estate service provider and property consultancy.

The Head of Research and Consultancy in CBRE, Matthew Green, mentioned that the performance of individual emirates continue to fluctuate, with Sharjah and Ajman already beginning to bear the brunt of over-supply in Dubai.

Ras Al Kahimah and Fujairah are among the least affected emirates, as they depend largely on locally generated demand, rather than spill-over demand by Dubai, Green added.

According to CBRE report, the apartment lease rate for northern emirates have declined 17percent during second half of 2009, and a further drop (10 to 15 percent) in housing rents are likely over the next one year. The maximum declines are in Ajman and Umm Al Quwain owing to their proximity to Dubai and Sharjah, which have huge supply volumes and are facing drop in rentals.

The property market in northern emirates was flooded with subdued economic environment during the second half of last year, with little demand for office or residential properties. It is the single bedroom apartments in the northern emirates that have seen the maximum drop over the past year (20percent), followed by 16percent on two bedroom units and 14percent on three bedroom apartments.

The maximum decline in rentals were recorded in Ajman, which has witnessed a drop in lease rates by 25percent, followed by 21 percent in Umm Al Quwain and 20 percent in Sharjah. The average lease rates in the northern emirates were in the range Dh.17,000 to Dh.24,000 during second half of last year for single bedroom apartment, Dh.24,000 to Dh.31,000 an annum for double bedroom and Dh.29,000 to Dh.43,000 for triple bedroom apartments. Umm Al Quwain recorded the lowest rates.

Thursday, August 18, 2011

Low rentals attract Sharjah, Ajman residents to Dubai

Residents from Ajman and Sharjah are moving to Dubai, as rents in the emirate gets highly attractive, according to analysts.

With rentals continuing to decline in Dubai, the Sharjah and Ajman residents are now planning to take advantage of the Dubai prices, which has hit the bottom.

However, according to Matthew Green, Head of Research and Consultancy, CBRE, it is not just the cheap rentals that are the main attraction in Dubai, there is quality accommodation too, on the offer, he explained.
For instance, the northern emirates lack up-market properties. The quality of units in Dubai is far superior to that of its northern emirate counterparts, he said.

However, he said that the economic uncertainty in the global market has been compelling tenants to opt to rent, rather than purchase, which is now impacting the freehold market in UAE.

According to Michael Michael, Director of Landmark Advisory, with fresh supplies hitting the market, occupants are moving towards established communities with good amenities.

The incentives on the offer range from offering rent-free periods of nearly two months, apart from lower rentals and parking fee, and better payment terms, Green pointed out.

However, despite the lower prices and huge supply volumes, there will be more residential units and commercial space, such as the projects in Sports City and Business Bay that are yet to develop.

Meanwhile, in the UAE capital, several residential projects are almost ready, and when they become available, there will be some migration happening from Dubai to Abu Dhabi.

The latest report by Landmark revealed that apartment rentals have fallen three percent in Abu Dhabi, while increased supply is the cause of rent decline in Dubai. Villas in Dubai have actually seen a growth of 2.8percent every quarter, owing to lack of supply.

Wednesday, August 17, 2011

Increased demand for Dubai villas

Increased demand for villas in Dubai has triggered a decline in apartment sales, according to the latest report by Landmark Advisory, the leading real estate consultancy.

The Landmark Advisory, in its latest Market Snapshot, stated that a solid growth of demand in residential sales has been noticed across Dubai in certain established localities, including Emirates Living, Downtown Dubai, Lakes and Meadows.

The apartment sales across Dubai fell by two percent, while villas have continued to perform well due to lack of fresh supply in 2011. This has resulted in an increase of 2.8percent quarter on quarter. This trend is evident in the second quarter performance report by Emaar, marking 85percent drop in apartment sales, and a surge in demand for villas and commercial plots.

Areas such as International City and Discovery Gardens have seen maximum declines, while localities such as Downtown Dubai have seen lesser declines. The major reason for better performance of prime markets is the minimal supply that they receive, said Michael Michael, Director, Landmark Properties.

According to Landmark research, the office market in Dubai continues to remain oversupplied, with another two million square feet to be delivered by 2014. Even now, the market condition continues to favour tenants, while landlords are willing to offer capital values and incentives.

According to experts, the latest initiative by the federal government to increase the residency visa period for real estate owners from six months to three years, and the impending new legislation that permits foreign investors to bear 100percent ownership in certain projects, serves as catalyst in reviving the property market.

Another positive aspect that is working well for UAE real estate sector is the Nakheel re-structuring plan.

Meanwhile, the Director of Management Consulting at Jones Lang LaSalle, Jesse Downs, said that the introduction of the three year residency visa, is a positive step in the right direction. Experts at Jones Lang LaSalle are of the opinion that oversupply will continue to impact office, residential, and retail space markets in Dubai.

CB Richard Ellis mentioned that another 25,000 new units in Dubai will further add to total residential stock, out of which, apartments would form 79percent of total residential stock in the market towards end of the year. Last year, 36,000 housing units were completed in Dubai.

According to CBRE forecast, the Dubai property market will see a mix of positive and negative sentiments this year.

Friday, August 12, 2011

Dubai real estate market picking up slowly, but steadily

The Dubai real estate market hit the bottom early this year. From here, things can only get better, and the market is already picking up. The rates and sales are increasing slowly, but steadily, said Ziad Al Chaar, Managing Director of Damac Properties.

Speaking during an interview to the Gulf News, he mentioned that the fundamentals of Dubai real estate market continue to remain strong even after the financial crisis. Given, the advanced infrastructure, coupled with good connectivity through world-class airport and a global airline, apart from the launch of Metro, such conveniences cannot be seen anywhere else in the region.

Moreover, the quality of life in Dubai is good, and will continue to remain so. Further, the property laws are in place now and is among the best in the Middle East. They are transparent, and serve the purpose by protecting investor interest. Even the property registration process is fully automated. All these are some major aspects that draw investors to Dubai, he pointed out.

Damac Properties is one of the leading developers in Dubai, which has been able to withstand the impact of financial crisis easily. Damac has delivered a total of 28 buildings comprising 6,045 units, and toward the year end, it plans to further complete eight buildings with total of 1329 units. It has another 50 buildings that are at various stages of planning across the MENA region.

Revealing the secret behind the strong success of the company, Al Chaar said that Damac hardly relies on banks or external finance. This has helped the company immensely when the financial crisis hit the market. During the crisis period, several of Damac’s projects were already in advanced stage of development. The company decided to continue with these projects, while only those that were yet to hit the ground were postponed. Therefore, the projects were delivered on time.

Further, the company offered alternatives to the clients and asked them to shift to projects that were under construction. This helped customers immensely, and the company was able to fast track several projects.
Further elaborating his views on the Dubai property market, Al Chaar said that the market is continuing to be an attractive one for foreign investors with the implementation of the new Strata Law, favouring homeowners.

Speaking about the property visa law, he said that it will help in boosting the realty market. However, more clarity on the details of the law is awaited, as majority of potential buyers are enquiring about this law, and it seems important for many, he concluded.

Wednesday, August 10, 2011

Al Majaz Waterfront re-development likely to increase rentals

Sharjah's Al Majaz waterfront development is likely to witness an increase in rental by atleast 15 percent, following a major redevelopment of the waterfront, according to a senior government official.

The rentals at Al Majaz and the neighbourhood will rise by 15percent following the development works happening at Al Majaz and the high-end restaurants and cafes in the locality, said Marwan Bin Jasem Al Sarkal, Chief Executive of Sharjah Investment and Development Authority (Shurooq), the developer of Al Majaz Waterfront.

The development, spreading 4,700 square meters will be ready for use by the public in November. Thereafter, there will be huge difference in rentals within span of a year. Residents can expect better offerings and services, and major difference on leasing and rental.

According to Matthew Green, Head of Research – CBRE (CB Richard Ellis), UAE, the eight restaurants, musical fountains, parks and art spaces, are sure to leave their impact on the rentals due to the superior amenities. The project will further have a positive impact on the market, impacting the rentals amidst considerable supply and will raise the emirate's profile.

Shurooq, together with Sharjah Chamber of Commerce and Industry (SCCI), under partnership will uplift the lagoon area. The standards of retail outlets are being improved, and there will be a whole change in the lagoon offering. This, in turn, will leave a positive impact on Jamal Abdul Nasser Street. The mid to low-standard outlets here will undergo major revamping when Al Majaz opens, confirmed Al Sarkal.

The Al Majaz Waterfront (also known as Khalid Lagoon) is being re-developed into a major tourist destination to attract residents who are currently travelling out of the emirate for entertainment purposes.

The SCCI Director General, Hussain Al Mahmoudi, commented that Al Majaz will be a major addition to improve Sharjah’s reputation and entertainment industry. Waterfront developments are still a unique concept in the emirate, and the development is hoped to increase traffic to the area, and develop the whole area and Al Wahda Street.

Being a major project, Al Majaz will be the landmark of Sharjah as a tourist destination, he added.

Monday, August 08, 2011

Sweet Homes delivers Falcon Towers to investors

Sweet Homes Holdings has announced the delivery of Dh.507mn worth Falcon Towers to its investors. Tenants have now begun moving into their new homes.

The eight tower project, located at the heart of Ajman, comprises seven residential towers and an office tower. The residential towers include a ground floor, four floors dedicated for parking and 20 residential floors. Each of the residential floors offers four three-bedroom units, two double bedroom units and single bedroom units.

The office tower is a single block tower comprising ground floor, four parking floors, and 23 floors meant for commercial use.

Falcon Towers forms a part of Ajman Freehold Property portfolio and is the fifth project to be completed in the emirate by Sweet Homes. The project construction began in September 2006, and was offered to potential buyers under the theme ‘Live, Work and Play’. The project is aptly located amidst the new corporate district in Ajman and is in proximity to major banks, malls, offices and restaurants.

The announcement reflects the healthy state of affairs in Ajman property market, partly due to the support rendered by ARRA (Ajman Real Estate Regulatory Agency), the government regulatory responsible for licensing of Ajman real estate market.

Monday, August 01, 2011

Dubai to bid for 2024 Olympic Games

The UAE National Olympic Committee has confirmed its plans to bid for the 2024 Olympic Games. The Committee arrived at this decision after withdrawing its earlier decision to bid for the 2020 Olympic Games.

A feasibility study regarding Dubai’s capacity to host 2020 Olympic Games revealed that nearly 70percent of the ‘hard’ infrastructure in Dubai was already in place. Therefore, a bid for the 2024 Olympic Games would be a better option, said a statement from UAE National Olympic Committee.

The strategy for sports by Dubai was laid out by H.H. Shaikh Mohammed Bin Rashid Al Maktoum, the Vice President and Prime Minister of UAE and Ruler of Dubai during the 1990s. Sheikh Mohammed established a Working Group chaired by Dubai Crown Prince Shaikh Hamdan, which set up a group which commissioned a group of sport industry to assess sports facilities in Dubai. This led to conducting a feasibility study by Pricewaterhouse Coopers and Populous to establish whether Dubai would be well placed to enter into bid for 2020 Olympics or thereafter.

Dubai’s experience in hosting top class sporting events makes it well-placed to win a bid, pointed out Shaikh Hamdan when speaking about Dubai bidding for 2024 Olympic hosting.