Thursday, June 28, 2012

Dubai ranked as most transparent real estate market in MENA region

Dubai remains the most transparent market in the Middle East and North Africa (MENA) region, while Abu Dhabi takes the second position in the Global Real Estate Transparency Index by Jones Lang LaSalle for 2012.

In the global ranking, Dubai and Abu Dhabi takes the 47th and 52nd position respectively on the index.
However, despite improved transparency levels in the MENA market, over the past two years, the gains have been comparatively ‘modest’, and real estate markets in the region are less transparent than in other global regions.

In Dubai, its regulatory framework is the strongest, says JLL. The Real Estate Regulatory Agency (RERA) is the acknowledged market leader in the region, while Dubai International Financial Centre has grown to be the vehicle of choice for listed real estate funds.  

Although, Abu Dhabi is behind Dubai by one or two years in the real estate development cycle, the report shows similar improvement in transparency to Dubai, since 2010.

In fact, the quality of market data is better in Abu Dhabi than in Dubai, in certain sectors, and the planning system is more regulated. Improvement in these areas has reinforced Abu Dhabi’s position as second most transparent market in the MENA region, JLL said.

The Head of Research for JLL-MENA, Craig Plumb, said that more needs to be done to increase transparency levels in the market in both Dubai and across the broader region, particularly in terms of investment performance indicators and data on market fundamentals.

According to Plumb, increased focus on sustainability will result in higher levels of transparency and disclosure. Saudi Arabia, Kuwait, Qatar, Oman and Bahrain registered only negligible changes in transparency levels since 2012.

The United States tops as the world’s most transparent real estate markets this year, followed by the United Kingdom and Australia. New Zealand and Canada occupies the fifth and sixth positions respectively.

Monday, June 25, 2012

Developer announces price range for Arabian Ranches townhouses

The townhouses at the Alma 2 cluster in Arabian Ranches have been priced at the range of Dh.1.4mn to Dh.2.2mn by its developer, Emaar Properties. The 62 units have been offered exclusively to owners and renters in the master community.

The Alma Townhomes 1 is a Spanish-style single family attached villas (townhomes), with units in the range 2,436 square feet to 3,153 square feet.

Emaar was supposed to come up with a second development this year, a townhouse project in Arabian Ranches, following the launch of its Panorama project in the Greens area. The project will have double and triple bedroom townhouses, with the current owners of Arabian Ranches being given priority for purchasing these properties.

According to data, the average price of townhouses in Al Reem cluster is Dh.2.28mn, while the average price per square feet is Dh.807. The average price of Alma Townhouses is Dh.2.59mn, with per square feet price being Dh.935.

During the month of March, Emaar sold 18 Golf Homes or luxury villas in Arabian Ranches Golf Course for Dh.7.3mn to Dh.11mn. Emaar demanded complete payment to be made within six months, wherein the buyers had to offer a bank guarantee of Dh.100,000, which would be returned to buyer, on completion of villa fit-out. The project was due for completion in 2 years.

In April, Better Homes reported that villas at Arabian Ranches saw a price increase of 15 percent over the past one year. A five bedroom villa now sells in the range Dh.4.5mn to Dh.4.7mn.

The Senior Residential Consultant, Green Community Office, Better Homes, Rene D’Souza, agreed about the 15 percent increase in rate in the townhouse segment of Ranches.

Leading Dubai-based real estate consultancy, Asteco, earlier this year, stated that real estate prices in Dubai have stabilized in certain villa communities, including Palm Jumeirah, Arabian Ranches and the Springs, that are already witnessing spikes of up to nine percent.

Thursday, June 21, 2012

New investor-friendly law helps claim damages, complete refund from developers

In case developers’ fail to complete or handover a property within scheduled time frame as specified in the sales contract, or if there is a deliberate intention of defrauding an investor, or altering specifications of the unit without the requisite permission, investors can recover all amount from the developer.
The draft law to this effect was released in Dubai yesterday for the first time. The department is expecting feedbacks until 29th June.  However it is now yet known, if the law will actually be implemented. 
The Director General of Dubai Land Department, Sultan Bin Mejren, in April, mentioned that the law will be implemented by the end of the month. 
The real estate investors will be eligible for cancellation of contracts, and can seek complete refunds, in case the developer fails to deliver the unit or services within the stipulated timeframe.
The Article (36) of the draft law explains that the following circumstances will entitle the investor to terminate the contract for sale and recover all amounts paid by it.
1. In case the developer fails to complete the unit, or handover possession to the investor within the timeframe specified in the contract, or for sale, as estimated or agreed date for handover, or whether or not the contract for sale includes provision, permitting the developer to delay completion and handover under any circumstances. 
2. In case the real estate unit, as built, is materially different from the specification of real estate unit, as specified under the contract for sale, including fall of 30 percent or more in the net area. 
3. In case, the developer, deliberately, with the intention of defrauding the investor, fail to comply with real estate unit’s specification of common areas and other amenities, under the contract for sale, there are some missing at the time of handover.
4. If the developer alters the specification of real estate unit, without obtaining the requisite permit from the competent authority to such change in violation of applicable rules, as a result of which, the investor is likely to suffer material loss, then in such cases, the investor can claim repayment of all amounts paid to the developer.
Further, if the Article (36) is not applicable, the draft law stipulates that Article (37) shall be applied under the following circumstances to claim compensation by the investor.
1. Breach of warranty or undertaking contained in the contract for sale by seller and broker.
2. Misrepresentation by developer, investor or broker.
3. Specifications in violation of contract for sale, after obtaining an expert report to that effect.
4. Delay for a period of more than a month, and less than a year.
The draft law also suggests that the investor shall be entitled to recover compensation from the developer, broker or investor who caused the loss. In case, the person responsible for the loss is more than one, it will be (jointly and severally) liable for and bound by the information and data provided to the investor prior to the sale, irrespective of whether such information was provided by means of letter in writing, email or announcement.
Under Article (15), the proposed law puts the developer as responsible in providing the buyer with correct information in relation to common areas within the Jointly Owned Property.

Tuesday, June 19, 2012

Emaar to release new townhouse project at Arabian Ranches this year

Emaar Properties is all set to announce its second development this year, which is a townhouse project, located in the upscale Arabian Ranches community.

Spread over 247 acres of land, the Arabian Ranches Golf Course comprises 120 acres of grass land and desert vegetation, which forms part of Arabian Ranches Golf Club. The 18-hole, par 72-signature course, has been designed by Ian Baker-Finch, in association with Nicklaus Design.

The development offers nearly 4000 units of one-storey, two-storey single-family homes.

Al Reem comprises double and triple bedroom attached villas (townhouses) of varying sizes in the range 1690 square feet to 3155 square feet.

Alma Townhomes is a Spanish-influenced single-family attached villas/townhomes with units in the range 2436 square feet to 3,153 square feet.

The Hattan villas are detached villas comprising two storeys, four and five bedrooms, in the range 5,443 square feet to 7,230 square feet.

Mirador la Coleccion villas are detached villas in the range of 3,458 square feet to 6,911 square feet, comprising four to seven bedrooms.

The Palmera homes are in the range of 1,889 square feet to 2,936 square feet, and comprise double to triple bedroom villas.

La Avenida is a cluster of 17 detached villas with Spanish and Portuguese style, and is centrally located between the Arabian Ranches Golf Course and the Arabian Ranches Lake.


The average prices of townhouses in the Al Reem cluster, at present is Dh.2.28mn, while average price in square feet is Dh.807. The average pricing for Alma Townhouses is Dh.2.59mn, with per square feet rate being Dh.935.

According to real estate agents, although there is good demand for villas/townhouses in Arabian Ranches, Emaar will have to price the product in the range Dh.1000 to Dh.1200 per square foot.

Emaar has been selling the 18 Golf Homes, or luxury villas, in the Arabian Ranches for Dh.7.3mn to Dh.11mn.

Emaar has been seeking complete payment be made within six months time, with buyers having to produce a Dh.100,000 bank guarantee, which would be returned once the buyer completes the villa fit-out. The time for completion of the fit-out is two years.

According to Better Homes, villas in Arabian Ranches have seen appreciation of 15 percent over the past year. The price of a five bedroom villa is now Dh.4.5mn to Dh.4.7mn. Even the townhouse segment has seen price increase of 15 percent in the Ranches, says Rene D’Souza, Senior Residential Consultant, Green Community Office, Better Homes.

The Dubai-based real estate consultancy, Asteco, mentioned that property prices of villa communities have stabilized within Palm Jumeirah, Arabian Ranches and Springs, with price hikes of up to 9 percent.

Thursday, June 14, 2012

Ajman Uptown project on track for scheduled delivery

Leading UAE-based developer, Sweet Homes Holdings (SHH), revealed that construction work at its Dh.2.2bn ‘Ajman Uptown’ project is proceeding as scheduled, and the initial 200 villa units are ready.
The company plans to complete 600 villas in the first phase of the project, by September this year. 

Located at the heart of Ajman, the villa project, comprising total of 1504 units is built on a 4mn sq ft land, and offers double, triple and four bedroom townhouses, apart from exclusive five-bedroom VIP villas.

The project draws inspiration from classic French architecture and showcases an ‘L’ ‘Art De Vivre’ theme. Located at the tip of intersection, close to leading industrial areas such as Ajman Industrial Area, Al Hamriya Free Zone and Sharjah Investment Park, the project will play a vital role in taking Ajman to be an ideal residential haven in the UAE. 

According to the Executive Director of ARRA (Ajman Real Estate Regulatory Agency), Yafea Eid Al Faraj, the project will be a model residential and business community for Ajman, with ARRA extending complete support to investors and developers, including Sweet Homes, for successful completion of the mega project. 

The master community development, on completion, will include a healthcare centre, school, fire fighting station, two Mosques, health and recreation club, markets, shopping malls, swimming pool, hotels and hotel apartments, spacious parks, luxury apartments, boutique offices, G+4 commercial and residential buildings, and a shopping walkway stretching one kilometre. The project is the only private villa project by SHH in the emirate. 

Wednesday, June 13, 2012

Indian developer launches new initiatives in Dubai realty market

Pacific Ventures LLC has announced the launch of new initiatives "Pacific Residencia" and "Pacific Edmonton Elm", located at the Jumeirah Village triangle.

The announcement is considered as another positive turn for Dubai property sector, where new developments, were being either stalled or slowed down, owing to economic crisis.

The Founder of Pacific Ventures LLC, Parvez Khan, mentioned that there is optimism about realty market in Dubai, as the economy in Dubai cannot slow down completely. Dubai will always be a major investment hub for serious real estate investors, who will appreciate the value of new affordable properties.

According to Khan, Pacific Ventures has an impressive 100% completion track record in India. It is a securely funded organization, with necessary resources to complete projects that is undertaken in the Middle East market at present.

The company plans to complete its first set of developments in Dubai by 2014, and that will be the first of several projects envisioned for the Dubai market and the rest of MENA region, with several other new projects planned on education, tourism and healthcare.

Pacific Ventures LLC already has an impressive track record of completing similar projects in India, and has earned a sterling reputation for developing luxury properties, known for high quality and eco-friendly features. The company has also responded well to economic challenges by introducing cost-effective and buyer-friendly features, offering easy payment options for their forthcoming properties in Jumeirah Village triangle.

Pacific Ventures LLC is an internationally acclaimed developer of residential, commercial and mixed-use properties in the Middle East. Together with other renowned design professionals, Pacific Ventures LLC creates properties distinguished by modern, chic and affordable designs.

Monday, June 11, 2012

Major projects gathering pace at RAK property market

Despite the global economic downturn in 2009 and 2010, Ras Al Khaimah (RAK), picked up comparatively well, with several developments being pushed forward.

The real estate and business sector contributed to 7.2% of total GDP in RAK during 2010, the RAK Department of Economic Development said in its latest data. Some major players, including Al Hamra Real Estate Development Company (AHREDC), Rakeen Development and RAK Properties, partly owned by the government have continued on track to oversee completion of major projects in 2012-13.

For instance, the Mina Al Arab villas project, which began in 2005 by RAK Properties, is now in its final stages. Towards mid-2011, the firm handed over a total of 307 villas, and the occupancy level for the project stood at 84% by February 2012, AHREDC said.

RAK Properties, the biggest real estate developer of the emirate, has seen large-scale developments that are nearing completion, including the $3.27bn beachfront resort, Mina Al Arab, featuring several islands, apart from recently completed RAK Tower and Julfar Towers.

Although the company posted net profits worth $29.5mn in 2011, marking a decrease from $51mn the previous year, the new revenue streams, in addition to handover of 3000 apartments, offices and villas by the year-end, indicate that RAK Properties should return to growth in the short-to-medium term.

Meanwhile, work on Al Marjan Island, a cluster of five man-made islands, near the Al-Hamra area outside the RAK City, the $1.8bn project, is progressing well, and is due for completed by 2015. The islands offer a range of developments, including residential and commercial, and apartments for rent.

Other major tourism infrastructure projects including Bab Al Bahr, and Al Marjan Island will open doors in 2012-13.

With growing number of tourists, owing to government's promotion of the sector, such developments will always be in demand. Nearly 1.2mn tourists are likely to visit the emirate by end of 2012, marking an increase of 800,000 numbers in 2011.

Due to increased number of buildings earmarked for completion and handover, connectivity problems may continue within UAE. But, it is evident that RAK Property market is back on track now, while other new projects are nearing completion.

Monday, June 04, 2012

Property investors can cancel contracts if developers violate terms

The latest draft of Real Estate Investor Protection Law stipulates that real estate investors will be given the right to withdraw their contracts and claim back their money, if developers violate the terms and conditions.

According to Sultan Butti bin Mujren, the Director of Dubai Land Department (DLD), this is a clear legislative tool, wherein the contract can be broken, and compensation can be granted to investors when the developer tries to breach the contract.

Besides getting back their money, investors can claim additional compensation, and the developer can be fined, he revealed.

The law has been under consideration for some time now, and is likely to be implemented by the department shortly. It aims to protect investors from delays in handover of projects, or unilateral changes in size or other such specifications of properties.

The draft law states that investors have the right to cancel the contract in cases of delay in completion of property, or delay in handover for more than a year. In fact, investors are eligible for compensation even if the handover is delayed by more than a month but, less than a year.

In the event of any defects, the law offers investors recourse, apart from undocumented claims and charges from developers, and other such provisions.

The new law pays more attention to observatory, regulatory, technical, executive role to protect the rights of investors. More attention will be paid to details of service agreements, maintenance contracts and property registration.

The law is the first of its kind on the regional and international level, and not only protects the investor rights, but, also brings in transparent business relationship between developers and investors, said Majida Al Rashid, Director of Center for Investment Management at the department.

However, there are concerns that the new law may not be applicable to existing disputes between developers and investors, and will be applicable only to new contracts.

The new law comes as a useful resource, particularly to non-resident investors, who have no access to monitor their investments directly, says Dr. Ahmed Belhasa, Chairman of large developer in the UAE.

RERA has already ordered cancellation of projects that are no longer viable. The new law further provides for the agency to pair up approved developers and banks to fund the completion of the projects. The new law also mandates that real estate agents and brokerage companies be licensed by and registered with RERA. The brokerage is not allowed to get commission unless the property is transferred to the investor.

Saturday, June 02, 2012

Discovery Gardens owners warned against short-term leasing of apartments

Individual real estate owners’ in Discovery Gardens have been warned against leasing their apartments on short-term basis, while violators are likely to face legal action, it has been announced.

According to notices posted in the building lobbies within the master community, the Dubai Department of Economic Development (DED) revealed that the residential units cannot be rented out on short-term lease, as such activities are solely restricted to hotel apartments companies. The notice warns of stringent legal action against violators.

However, it is said that despite such warning, the property owners have been placing online adverts, offering furnished apartments for Dh.2000 to Dh.6000 per week. According to owners, renting out on such short-term basis, offers great investment returns on investment.

The Nakheel interim Chief Executive Officer, Sanjay Manchanda, when speaking to the media in February, said that short-term leasing has been rampant in Palm Shoreline Apartments, and such renters were creating problems when they were refused access to pools, gymnasium and beach.

The CEO –Business Registration and Licensing at DED, Mohammed Shael, explained that short-term residential rental is an economic activity. Any individual keen on being involved in such an activity will have to seek license being able to access such service. This will require incorporation of a company through Department of Tourism and Commerce Marketing.

Discovery Gardens comprises six themed communities, including Zen, Mediterranean, Mogul, Contemporary, Mesoamerican and Cactus courtyard gardens, drawn on inspiration by garden living. It spreads across 26million square foot plot, offering 291 buildings.