Wednesday, February 29, 2012

The beach club at The World Islands ready to welcome its first guests

The Royal Island Beach Club on ‘The World Islands’ in Dubai opens to public later this month.
The dream project of Wakil Ahmed, leading Indian businessman, was a far-fetched thought at one stage. He changed his mind when he got an opportunity to purchase an island on The World project in 2004.

Having lived in Dubai for more than 35 years, he believes in the vision of H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai.

Dubai is a tourist destination, and will remain so forever. Despite the global economic slump, The World project will go ahead and Dubai will deliver the promised, he said.

Ahmed paid Dh.32mn for the island in 2008 and secured title deed. He has invested nearly Dh.38mn till date, to build the first club project on the island. This island, located at the heart of The World, is ready to welcome its first guests. The club offers eight private chalets, an international cuisine restaurant, swimming pool, and two beach areas.

Located at the centre of the The World, the Lebanon Island chosen for the project is at the heart of The World. The cost is dependent on the desire of the clients and can be in the range of Dh.500 to Dh.5000 per head. The island is also offered for private functions or to people seeking to hire it for a day or two.

The Royal Island Beach Club has signed a MoU with Roads and Transport Authority to ferry tourists to the club.

The World development spans across 931 hectares, with an additional 232km spanning across the beachfront to Dubai coastline. Nearly 300 islands have been reclaimed from the sea, in the shape of the world map. Yachts are the primary mode of transportation, giving both residents and visitors a water-oriented travel experience across the Gulf waters.

The islands are in the price range of $20million to $50million. The development comprises five types of island community including Mid Density, Estate Islands, Commercial and Transportation, and Resort Islands. The World includes a range of resorts, villas, restaurants, apartments and retail outlets, among a range of boating, beaches and other leisure opportunities.

Monday, February 27, 2012

Nakheel issues Dh 202.2mn to lenders as part of re-structuring

One of the largest real estate developers in Dubai, Nakheel, has paid Dh.202.2mn to its lenders, as part of re-structuring process. The payments are in-line with the due date for the month-end.

A Nakheel spokesman revealed that the timely payments indicate successful implementation of restructured operations, and further strengthen the commitment by the company for successfully implementing the agreed operating plan, following the completion of largest and most complex re-structuring in the Middle East in August 2011.

Nakheel earned net profit of Dh.526mn during first half of financial year ending December 31, 2011, and Dh.1.5bn revenues. This was possible after successful restructuring of the company’s debt and transferring ownership from Dubai World to Dubai Government.

The revenues were largely driven by handover of development properties in several Nakheel projects. Among the other business segments that helped in achieving positive results are retail and leasing.

This year, Nakheel has launched several new projects, including The Pointe development, a destination mall to be located at tip of Palm Jumeirah, Palm Mall and expansion of Dragon Mart.

Thursday, February 23, 2012

More rental declines likely in Abu Dhabi this year

With supplies expected to surpass demand over the next 12 months, rentals in Abu Dhabi will drop further this year, as the emirate works towards a five percent growth, said CBRE, the real estate consultant.

Despite several positives such as sound macro-economic fundamentals, stable political environment, and a solid fiscal stance, downside risks still persist with huge delivery of considerable volume of new developments, involving commercial and residential sectors, said CBRE, in its market view.

The office sector in Abu Dhabi has also seen steady decline in lease rates last year, with further deflationary pressures anticipated over the next one year, as fresh supplies hit the market.

Landlords too, are getting more realistic and flexible in their approach to leasing, offering rent-free periods as standard market practice. The office market has seen renewed interest from commercial occupiers, seeking to expand their operations, the report said.

Meanwhile, the residential sector in Abu Dhabi continued to see modest decline in rents. Delivery delays last year have helped in alleviating the onset of more aggressive deflationary pressures.

As for UAE real estate sector, it has “selectively bottomed”, with major financials poised for growth. The banks in Abu Dhabi are well positioned to benefit, it is said.

According to leading real estate specialists, investment in UAE real estate sector by GCC nationals is growing, with more banks returning to real estate financing. According to real estate specialist, there has been an increase of local buyers, seeking to invest in a real estate market, at the backdrop of growing real estate financing activity.

At present, 95 percent of lenders have returned to the UAE market, led by Tamweel, the report said.

Tuesday, February 21, 2012

Investors drawn to quality residential projects with more than 60% completion

The region's largest private luxury developer, Damac Properties has announced major increase in its portfolio of completed projects and those nearing completion, across the Middle East.

The Middle East is suffering from considerable shortage of quality residential properties, said Damac Properties.

According to the Vice President of Damac, Niall McLoughlin, investors are currently shifting focus on projects that are more than 60percent complete. The investor interest in the Middle East has grown in 2011, although the interest is more on narrow band of completed and income producing properties.

Mc Loughlin said that the surge in demand for quality residential properties is surpassing the current supply. Therefore, developers, including Damac Properties are focussing on quality of the finish and standard of amenities, in projects that are currently under construction.

Saudi Arabia, alone will require one million new housing units over the next three years, as the country is facing shortage says H E Sheikh Hamad bin Jassem bin Jabor Al Thani, the Prime Minister and Foreign Minister in Qatar.

 The company handed over a total of 21 buildings, apart from delivery of Versace-branded residences in Saudi Arabia, and its hospitality offering Damac Suites and Spa. Damac also won a series of regional and international awards, including being named as Developer of the Year in the Big Project BGreen Awards.

Saturday, February 18, 2012

Damac promises guaranteed annual rental returns on its new development

Damac Properties has promised 24% guaranteed annual rental return on all its units purchased at Burjside Terrace serviced apartment development in Dubai. This is its latest initiative in boosting real estate sales, and to increase investor confidence and stability in realty market in Dubai.

The developer is offering 8% guaranteed tax-free rental return in a span of three years.

The Senior Vice President at Damac, Niall McLoughlin, mentioned that such a secure guarantee is unheard of anywhere else in the world at present. He confirmed that there is no catch or no fine prints in this offer, and that it is being done to add value to company’s real estate proposition.

The rental guarantee will appeal to a range of investors seeking stable guaranteed returns on their investment. There is also scope for capital growth, which is an attractive investment proposition, McLoughlin added.
Damac Properties will take responsibility for leasing and managing the unit, eliminating stress for investor, he said.

The Burjside Terrace Serviced apartment, located on the platinum stretch of real estate within Downtown District in Dubai, is in proximity to The Burj Khalifa, world’s tallest building, and is directly opposite the Dubai Mall.

Burjside Terrace has Armani Hotel and Dubai’s iconic Address Hotel as neighbours, which distinguishes itself amongst its peers. Damac Properties Serviced apartment developments in Downtown Dubai will be managed by Damac Suites and Spa.

Damac Properties is currently focused on the serviced apartment development model, as construction continues at Burjside Boulevard on level 47, while the foundation and enabling works are completed at Burjside Terrace.

Serviced apartments are best in bridging the gap between luxury five-star hotels and residential properties. There is an extremely strong interest in this particular market segment, McLoughlin pointed out.

Damac Properties has been a major contributor to real estate revival of Dubai, and it continues to extend its portfolio of luxury products offering major investment opportunities.

Thursday, February 16, 2012

Guidelines to be followed when purchasing a house in Dubai

Purchasing a house in Dubai can fetch excellent returns in the long-term, although at times, people end up with not-so-good deals. Therefore, briefed here are few guidelines to be followed when buying a house in the city, as explained by few real estate brokerage firms to ‘Emirates24/7’.

Do not get carried away just by the looks of the house

Often, buyers go by the look of the house, without asking for a structural survey of the place.  People tend to purchase existing properties, without carrying out any structural and condition surveys of the properties that they plan to buy.  However, experts believe that such a practice may be bad in reality. According to Charles Neil, the Chief Executive Officer at Landmark Properties LLC, prior to purchasing property, one should always inspect certain aspects such as maintenance records of the house, and whether the original owner got the property professionally snagged, and if the annual maintenance contracts are in place.

Look into any extra charges involved

Majority of buyers in Dubai, just take into account only the selling price and fail to look for the other charges, which would eventually add up among the monthly bills to be paid. One need to have good knowledge of service charges and find out in what manner this is included on the property to be viewed. Also, several buyers do not understand which mortgage will work for them in the long-run, and hence it is best to seek professional advice, says Vineet Kumar, Head of Business Development, Asteco Property Management.

Rightful ownership and registered agent issue

It is vital to check the credentials of the seller. There have been several cases wherein people were duped into purchasing the property from somebody, who in many cases were not the rightful owner. Hence, going to the wrong agent can add to the problems. Buyers therefore need to check if the seller is the true owner authorised to sell the property, and if he is a bona fide and properly registered with RERA, Neil suggests.

Be cautious when purchasing off-plan properties

When purchasing an off-plan property, it may be an affordable option, but, several times, the buyers can get into a deal without being clear about what it is all about.  Kumar says, it is best to ask yourself, if the house you plan to buy is for rental investment or for capital appreciation.

Distance to workplace should not be a priority

Experts emphasize that distance from your potential home to the workplace should not be the deciding factor, as this may not be a permanent factor, and is bound to change. The focus should be on location, and budget and quality of life, rather than commutation to office, said Vineet Kumar.

Do not invest much on refurbishment

Usually when people move into new homes, they spend a considerable amount in moulding it to suit their desires. However, this will not add to value of property, and will not help if the owner intends to sell home after few years. Investing nearly Dh.100,000 in doing up the Kitchen, bathrooms, and changing the flooring, etc., will not anyway make the property dearer. This may lead to higher pricing when offloading the property, although it may not bring in enough buyers.

Monday, February 13, 2012

Homeowners in Dubai can soon manage their own properties

Over the next few months, home owners in Dubai will be given the right to manage their buildings and finances. RERA (Real Estate Regulatory Agency) is signing deals with local banks, making way for Interim Owners Associations (IOAs) to open bank accounts within a few months.

According to Mohammed Khalifa bin Hammad, Senior Director, RERA, deals will be signed with three local banks, but, being an entirely new service, the banks will be given some time to fine tune themselves.

The delay by IOAs in gaining legal status is primarily due to associations failing to submit the common area site plan. This is mandatory, and has to be submitted along with Jointly Owned Property Declaration, copy of Annual General Meeting and code of conduct certificate for IOA members from the local police.

He revealed that, on opening the bank accounts, IOAs will not be allowed to do any transactions by cheque or cash, and that it will be a bank to bank transfer. The banks will have to check and ensure that the invoice raised by owners association is to an authorized service provider for the building.

Further, in order to help the existing IOAs in gaining legal status, the agency will grant exemptions, allowing them to operate bank accounts. The IOAs will have to meet certain conditions, after which, a letter may be issued to open a bank account. But, the manner of implementation of plan is yet to be decided, Hammad said.

Saturday, February 11, 2012

UAE constitutes lion's share of construction projects in GCC

Out of the $1trillion worth major projects in the region, the UAE ranks topmost among GCC nations with its lion's share of $636bn worth construction projects.

Qatar was ranked second with $106bn worth projects, majority of them being investments in oil and gas, electricity generation, water desalination, heavy industry, social infrastructure and transportation links.
According to Edmund O'Sullivan, the Chairman of judging panel of MEED Quality Awards for Projects, an independent award recognition programme, established in 2011, the projects that have been completed, and those that are currently underway in the GCC nations, bear special significance, to an extent that is unmatched anywhere else on the earth.

In January 2012, the UAE projects industry was worth $581bn. The new projects in February are likely to boost the total value of projects to $636bn.

Another report by the Business Research and Intelligence firm, CPH World Media, revealed that UAE has the largest number of active projects in the region, with over 1200 projects, worth more than $931bn underway for this year.

Given, the major size and complexity of projects in the UAE, and the impact they have in economic diversification, the effective and efficient execution of both planned and ongoing projects will be vital to the country's success.

The MEED Quality Awards in GCC is given away in recognition of completed projects, and evaluates the outcome of construction processes. Now, into its second year, the MEED Quality Awards for projects in GCC is judged by an independent judging panel. The 2011 award winning projects included the UAE's Burj Khalifa, Kuwait's National Library, and Qatar's Mesaieed A.

"This is not about the project being tallest or biggest. The projects are reviewed based on economic, social and environmental impact, as well as innovations in design, construction and engineering. These benchmarks will bear an impact on the long-term success of not just the projects industry, but, GCC as a whole," O’Sullivan said.

Monday, February 06, 2012

Dubai Real Estate Market Overview 2011-12

The Consumer Confidence Index (CCI) from the Department of Economic Development (DED) reveals that the year 2011 ends with mixed signals for Dubai real estate market.  The CCI from the DED grew 15 points, touching 125 in the final quarter.

Residential sector

The residential sector in the emirate grew over the last quarter and was highlighted in the Dubai Land Department data.  The total number of residential sales during the last quarter of 2011, touched 2,605 in number, in comparison to just 1,589 transactions recorded in the third quarter. This marks a solid 64percent growth quarter-on-quarter.  

On the whole, the residential sector continued to show signs of stability. Average lease rates fell by 2percent during the quarter, although villa rates remained unaltered, indicative of the strength in that segment.  The 2percent drop in apartment rents has been largely attributed to deflationary pressures in secondary locations such as Dubai Silicon Oasis, International City, and Dubailand Residences.

There has been increasing interest from investors on established community projects offering superior amenities. A similar situation is also seen in occupational markets, and there is high demand and growing occupancy rates in areas in Downtown, Emirates Living, Palm Jumeirah and Dubai Marina.

Townhouses and villas have managed to outperform apartments during the year. A limited supply of units and stronger demand fundamentals saw rental decline just 6percent over the period, which was less than half of the fall registered in 2010.

Office Market

Office rents in Dubai have remained unaffected for four consecutive quarters last year. The lease rates during the fourth quarter were in the range Dh.1080 to Dh.1940 per square meters, per annum, inclusive of service charges. The tenants have been looking for quality accommodation, which resulted in Prime CBD offices outperforming wider markets in 2011.

Nearly 58,000 square meters of new office space entered CBD last year, which has added pressure to vacancy rates, although it was not sufficient to have an impact on rentals. However, despite the lease rates being static, landlords no seem to be more open to offering incentives, aiming to minimize vacancy rates. Therefore, extended rent-free periods can be negotiated on long-lease tenures.

As for the secondary office market, the lease rates in secondary locations dropped by 11percent, in comparison to 30percent decline the previous year (in 2010).

In majority of secondary office locations, the ongoing construction activity and ownership status bears a negative impact on lease and occupancy rates. Although lease rates have not changed over the past six months, the vacancy rates have continued owing to new office space entering the market. This trend is likely to continue further, as new office towers are likely to enter the market in 2012, further increasing vacancy rates.

General Outlook for 2012

With huge pipeline scheduled for completion over the next 12 months, commercial offices remain pressurized throughout 2012. Nearly 750,000 sqm of fresh stock enter the supply during this period, provided, construction delays are kept to minimum. New supplies will largely be from secondary and tertiary locations including Dubai Investment Park, Jumeirah Lakes Towers and Business Bay. The lease rates, however, will remain stable in 2012.

The residential sector, though, will continue to outperform office sector, with stronger demand fundamentals being sustained by solid population growth. Developments that are fully complete will attract majority of interest, particularly within the more popular ‘lifestyle’ projects.

The report was prepared by CBRE Dubai Research Team, which forms a part of CBRE Global Research and Consulting, a network of researchers and consultants, who join together to offer real estate market research, econometric forecasting and consulting solutions to real estate investors and occupiers across the globe.

Saturday, February 04, 2012

Nakheel unveils new apartments for lease at The Gardens

The Gardens Community will launch at least 1500 new apartments for lease this year.

Leasing for four buildings in The Garden Apartment project, by Nakheel, began in second week of January. The remaining four buildings will be leased based on market demand.

According to Nakheel's renting plan in December, a small studio will be leased for Dh.24,890 (if paying by single cheque) to Dh.27,250 (in six cheques), while a large studio will be leased for Dh.30,770 (in one cheque) to Dh.33,650 (in six cheques). Meanwhile, single bedrooms are leased for Dh.43,720 to Dh.47,500, while large single bedrooms are leased for Dh.44,620 to Dh.48,500. These rentals are inclusive of service charges and cooling.

Earlier this month, Nakheel lowered rentals in The Gardens by 15 to 20 percent since December 2010, when the chiller charges grew by nearly 150 percent in November. Single bedroom apartments were leased for Dh.34,200 per annum, if tenant pays in single cheque, and Dh.40,000 per annum, if paying in six cheques.

The Chief Executive Officer of PropSquare Real Estate, Parvees Gafur, said that rentals demanded by Nakheel on these new blocks are highly variant, depending on the happenings there. While some of the blocks are getting older, the new buildings are likely to draw in tenants.

The signs of rents and price stabilisation were slightly visible in certain residential parts of Dubai, although, a broader recovery is expected towards the year-end.

Thursday, February 02, 2012

Dubai, now home to world's tallest residential tower

Tameer, the leading UAE developer has announced completion of its landmark 414mts Princess Tower, which makes it, the world’s tallest residential tower.

Spanning across a land area of 37,410 sq. Ft., the Princess Tower houses 763 luxury apartments, including single, double, triple and four bedroom apartments, apart from penthouse apartments facing Palm Jumeirah, a statement from Tameer revealed.

The project, now in its final stages of development, has completed the dome and mast structure, which will be handed over during second quarter of this year, Tameer announced.

Commenting on completion of the project, the Tameer President, Federico Tauber, said that it is satisfying to have completed another landmark project in Dubai. The Princess Tower is now the tallest residential building, and the distinctive location and iconic status as a residential super-high rise, makes the development one of the most prestigious address to live in.

The huge Dubai Marina development comprises 107 storeys, encompassing basement floors, one ground floor and 100 above-ground levels. The tower also offers sports and recreational amenities, car parking, swimming pools, commercial retail outlets, billiard and table tennis rooms, children play areas and fully equipped gymnasiums.