Friday, August 31, 2012

Top residential communities in Dubai in H1 2012


New Dubai is one of the most sought-after residential communities in Dubai this year, the real estate agencies have revealed.

According to Better Homes, Dubai Marina tops the list as the most popular residential area in leasing, during the first half of this year.

Meanwhile, Rushiraj Mehta of Legacy Real Estate said that in the villa category, Springs and Meadows, recorded increase in rental transactions during first quarter of the year, making these communities a popular choice.

As for the apartment category, Mehta says that Executive Towers in Business Bay tops all other communities and buildings. Executive Towers recorded minimum 10 percent growth over the previous year, while Emaar's Greens recorded 5 to 8 percent jump in rental transactions over the same period last year.

According to Asteco estimates, there were 6 percent rental rates in established communities during H1 2012. Apartments in Downtown Dubai and Dubai Marina were the most in demand, marking 10 percent growth with a double bedroom apartment fetching Dh.90,000 to Dh.120,000 per annum.

In the villa category, Asteco figures indicate that rental increase with increased demand was mostly noticed in Mirdiff area, while double digit growth was also recorded in Arabian ranches.

Tuesday, August 28, 2012

Dubai working on new law to protect investors, and care for developers


The Dubai Land Department has asked the real estate developers to review the draft code of Corporate Governance for Developers, after seeking opinion from public on Real Estate Investor Protection Law last month.

The department has asked all real estate developers to review and share their opinion on the draft code.
The Land Department had last year announced that it is likely to mandate all developers (master and sub-developers) to follow the Code for Corporate Governance from 2013.  

The code, developed by Hawkamah, the Institute for Corporate Governance, together with the department, outlines the responsibility of the developer to ensure that they disclose alternatives available for prospective investors in cases of delay in completion or handover.

The draft also suggests that all developers will have to appoint a dedicated investor relations officer, who deals with enquiries of individual and institutional property investors.

Further, developers will have to ensure that sales and purchase deal for built-up and off-plan properties reveal complete information about the property, including parking space, common areas and service charges.

The draft code also proposes that buyers be provided with comprehensive document containing complete information about purchased property, resident etiquette, the person to be approached in case of maintenance issues, information on the owners association and association manager, developer’s warrantee, information on community, where the property is located.

In cases of off-plan properties, developers will have to provide complete information about the property to registered brokers or selling agents or prospective buyers, which include project description, infrastructure information and utilities, with complete details of the property.

Another suggestion in the draft code is that the developer selling off-plan property should try obtaining a “credit rating” agency to improve investor confidence levels

Monday, August 27, 2012

Ajman working on fresh projects to woo tourists and investors


The Ajman municipality has undertaken several projects to improve infrastructure in the emirate and draw investors and tourists into the emirate.

There has been increased demand in Ajman for licenses to begin industrial, commercial and entertainment businesses, revealed Shaikh Rashid bin Humaid Al Nuaimi, the Chairman of Ajman Department of Municipality and Planning.

The civic body is speeding up work on various road projects to improve traffic movement. The roads would be made up to the best international standards. The Municipality has completed construction of Shaikh Jaber Al Sabah Road, Al Nuaimia Main Road and College Street, and several internal streets have been paved and made two-way. Several other parking lots have been constructed, and street lighting and drainage worth Dh.29mn have been installed.

The Municipality is now working on the possibility of road improvements in Al Muwyhat and Al Zahra localities, wherein the streets would be paved for two-way traffic.

The project may cost Dh.16mn, including street lighting for safety of residents. The Municipality has also finalized designs for development of Al Rameelah, Al Nakheel and Al Bustan areas. Work is underway to revive heritage tourism by constructing Salih Souq, by reviving old city areas and improving Ajman Museum.

The Municipality is also working on a proper drainage system in areas like Al Nuaimia. The project includes drains to take rainwater to sea. It covers an area of 303 hectares, including a section of Al Ittihad Road in Al Nuaimia area.

The most important achievement during first quarter of the year was the completion of development of Ajman Corniche and the beach, Shaikh Rashid said.

The Municipality has re-organized the city areas by implementing a new system of numbering all roads and streets in the emirate.

Friday, August 24, 2012

Major developers to remain focused on income-generating assets


Emaar Properties and Nakheel are likely to continue focussing on their income generating assets, as the real estate market in Dubai matures, and deliveries continue at slow pace, CBRE said.

During first half of the year, Emaar enjoyed sales from higher apartments, owing to launch of their Panorama at the Views project.

But, overall, major developers are seen focusing on income generating assets, and in developing their communities further, so as to derive fresh revenue streams, said Matthew Green, Head of Research CBRE.
Emaar and Nakheel have announced expansion plans, recently, for all major retail centres, including Dubai Mall, Ibn Battuta, and Dragon Mart, which indicates current market confidence, he said.

Tuesday, August 21, 2012

Nakheel resumes construction activities in Palm Jumeirah, Dragon Mart


Nakheel, after its restructuring process to manage debt, has resumed construction activities in the Palm Jumeirah and Dragon Mart at Dubai International City.

Recently, it sold a Dh.40mn plot on the Palm Jumeirah Island.

The developer also revealed that it recorded a strong profit of 36 percent during the first half of 2012, surpassing that of the previous year.

The Managing Director of Harbour Real Estate, Mohanad Al Wadiya, speaking about the market, said that confidence is returning to the market, with major developers reporting healthy profits and renewed activities. The industry is certainly more vibrant now.

Sunday, August 19, 2012

Dubai realty market on strong recovery path, albeit at slow pace


After four years of having faced the impact of worst ever global economic crisis in September 2008, which led to halting of most of the development activities, the real estate market in the UAE is now showing signs of recovery.

With support of structured cash injection, careful re-engineering of major development companies, and re-scheduling of projects and debts, the sector is likely to rebound, although at a slow pace, experts said.
According to the latest report by Jones Lang LaSalle (JLL), leading real estate consultant, the overall residential market indicates a positive trend, with villa market continuing to outperform the apartment sector during the second quarter of 2012.

The real estate sector has begun to show signs of improved investor confidence with increase in demand for quality properties in ideal locations, and income producing assets. Such prime residential buildings in established locations are seeing improved performance, although secondary locations are suffering from rental and pricing declines.

Except RAK properties, all publicly listed real estate developers have shown strong growth in the second quarter of the year. Emaar Properties recorded 45 percent increase in net profits, Aldar Properties recorded 228 percent jump in net profits during second quarter of the year, while Sorouh Real Estate recorded 29 percent increase than during the same period a year earlier.

According to Emirates NBD Research, the real estate recovery in Dubai appears to have continued in Q2. The prices for almost all sectors of housing also increased during the period April to June this year.

The data by Cluttons reveal that mid-range villa prices grew 18.5 percent year-on-year last month, surpassing the previous 14.6 percent year-on-year growth. The prices of apartments also grew modestly, while price declines in the low-end apartment sector have slowed down.

The Dubai Land Department showed that total value of land transactions in Dubai grew 21 percent, touching Dh.63bn during first half of 2012. The Director-General of Land Department, Sultan Bin Mejrin said that these figures indicate the strong growth and performance of the market.

The Head of Research and Consultancy at CB Richard Ellis (CBRE) Middle East, Matthew Green, said that UAE property sector is quite fragmented and Dubai is already seeing improved stability and growth, and this trend is likely to continue for the rest of the year.

The Senior Vice-President of Damac Properties, Niall McLoughlin, said that confidence is returning to Dubai market, with investors seeking to capitalize on great offers. An increase in valuations are likely although this year and in 2013.

However, for Abu Dhabi, the development cycle is considerably behind Dubai, and the market is only now reaching the peak of its development cycle, CBRE said in its report.

A recent report said that Dubai continues to be one of the top performing 15 cities in global real estate sector, and number one in the Middle East, all through the second quarter, while the Asian markets and European capitals also indicate resurgence and growth stimulus.

Monday, August 13, 2012

Construction sector gaining pace in Dubai, yet again


Despite the slow recovery of construction sector in Dubai, following the global financial crisis, with new developments almost coming to a standstill, now there are increased signs of the industry gaining pace once again, reports Oxford Business Group.

The International food corporation, Nestle, during end of June, announced plans to construct a factory in Dubai, with initial investment of $136mn. The facility will be built on a 175,000 sq meter plot at the Dubai World Central site, and will be used to manufacture food and coffee products.

Soon after, the Dubai-based developer Nakheel, announced the signing of a $7.5mn deal, towards construction of a new mall in the neighbourhood. The Jumeirah Park Community Centre, which spreads across 10,600 square metres, includes retail and food outlets. The construction contract has been awarded to Parkway International Contracting.

Although these projects do not match the scale of those during mid-2000s, it is a clear indication that construction works have begun to gather momentum, once again in Dubai.

It is said that a revision of Dubai Strategic Plan 2015 is being planned for development of the emirate. The plan, which is in its final stages of drafting, lays emphasis on tourism-based development in Dubai, while also taking into consideration the current global economic conditions.

However, on the other end, the Dubai construction sector is still not completely out of the impact of the 2008 economic downturn. It may take some time before all the disputes that arose from global financial crisis are resolved. But, majority of developers in Dubai, have restructured and worked on their debt burdens, which implies that they are now in a better position to move ahead and work towards building the future again.

Thursday, August 09, 2012

21% growth in land transactions during 1H 2012


Land transactions in Dubai has increased by 21% year-on-year, making a total of Dh.63bn during first half of the year, with investors seeking to capitalize on the priced properties in the emirate, the Dubai Land Department (DLD) said.

The Director General at the Land Department, Sultan Butti bin Mejrin, mentioned that real estate market in Dubai has shown high levels of flexibility in meeting investor requirements and trends during first half of the year, particularly with new investors seeking to take advantage of price correction that happened over the past two years.

The results indicate strong performance and growth in the real estate sector of the emirate, with prices having grown over the past couple of months, owing to high demand for villas, flats and land.

During first half of the year, a total of 14,652 sales transactions worth Dh.30.8bn were registered in Dubai, constituting 49% of total transactions. The mortgage transactions were a total of 3363, worth Dh.29.6bn, constituting 47% of total transactions. Majority of increased transactions were due to Burj Khalifa, generating Dh.2.04bn revenue from sale of apartments.

Dubai real estate sector is now showing signs of recovery in prime locations, following the fallout of global financial crisis in 2008.

Tuesday, August 07, 2012

Dubai realty market records highest unit sales in July 2012


The real estate sector in Dubai has recorded the highest ever unit sales and total unit value this July, in comparison to any other months so far, as per the latest data by Dubai Land Department.

A total of 1,767 transactions were recorded during the month, with a total of 193,629 sq m or more property units sold.

In-line with latest trends, the top performing areas have been Downtown, Dubai Marina and Jumeirah Lake Towers, with combined value of transactions from these accounting to 67percent of total value of unit transactions during the month.

According to Managing Director of Harbour Real Estate in Dubai, Mohanad Alwadiya, the market is certainly recovering, and there is increased confidence. The latest reports are showing healthy profits and renewed activity with several lead developers active in the market and industry seems more vibrant now.
Emaar had announced an 82 percent surge in its first half profit for the year 2012, apart from expressing renewed interest in developing a townhouse project in Dubailand.

Nakheel also reported a strong profit growth, marking 36 percent increase in its first half profit in 2012, in comparison to that of 2011. The company also plans new developments based on resurgence in demand for Dubai property.

On the whole, there is increased optimism and confidence in the market and the growth trend seems very exciting, Alwadiya said.

Thursday, August 02, 2012

Major property developers in Dubai post profits this year


Major real estate developers in Dubai, who were facing financial losses during the times of global financial crisis, have now delivered strong profits, indicating that the property crisis in the emirate is easing out.
Although the market still seems oversupplied, with half-empty buildings noticed along the skyline, the recent house price data and earnings show a picture leading to growth.

Four years, after the property market hit its peak, following the construction freeze, the developers are now seen completing their projects, and buyers have returned to the market. Dubai has been further benefited by the Arab Spring that boosted demand for regional havens and the vibrant tourism sector that improved confidence in the emirate.

The government-owned real estate developer, Nakheel, shook global markets back in 2009, when it nearly defaulted on its debt, reporting 36 percent increase in net profit during the first six months. Handover of completed properties improved the outlook of the company, too.

Meanwhile, the Emaar Properties, developer of world’s tallest tower, received a boost with income from malls and hotels. The company's second-quarter profit doubled, thereby beating estimates of analysts.
Following the financial crisis, real estate prices in Dubai have more than halved. Cheap credit dried up and owners defaulted on payments. Although confidence has returned, several projects continued to remain stalled, including those in Dubai Waterfront, Palm Jebel Ali, and numerous other tower blocks. However, the latest report from Knight Frank and Jones Lang LaSalle (JLL), the property consultants, indicate that there are incremental increases in real estate prices in Dubai.

The prices grew 5.6 percent in the past six months, while prices of apartments in the emirate grew by 2 percent in the second quarter of the year, revealed the latest Knight Frank Prime Global Cities Index.
The latest report by JLL states that villa prices have grown by 21 percent year-on-year, while apartment prices are up 1 percent. According to real estate agents, prime locations are most benefitted from the Arab Spring effect.

Better fundamentals are now prompting developers to begin new projects. JLL revealed that 24,000 new residential units are likely to be ready by second half of this year, adding to current stock of 344,000 units at the end of first half.

Majority of the forthcoming residential units are being handed over by Nakheel, which has received a $9bn funding from the government, as part of its $25bn restructuring of its former parent, Dubai World.

Meanwhile, Emaar is moving ahead with fresh launches, including new towers in Burj Khalifa. The developer has also announced purchase of land adjoining its Arabian Ranches community to meet further expansion plans. Half of Emaar’s revenues are now from rentail, retail and hospitality, as the company has diversified from home deliveries alone.

Nakheel has also announced plans to diversify into retail with launch of new shopping centres on Palm Jumeirah and expansion of its Chinese wholesale mall on the outskirts of Dubai.

Another leading Dubai developer, Union Properties, has reported a net profit of Dh.106mn, thereby reversing its Dh.439mn loss for the first half of last year. Speaking on Dubai property market, the Chairman of Union Properties, Khalid bin Kalban, said that a positive trend has been noted in revival of the market, with better value in rentals. Union Properties is also on its way for more retail development.