NEWS BRIEF 34 - Asteco Property Management · 2016-05-29 · Downtown Dubai in Burj Khalifa district. “The launch of Langham Place Downtown Dubai complements the emirate’s strategic

DUBAI | ABU DHABI | AL AIN | SHARJAH | JORDAN © Asteco Property Management, 2015 asteco.com | astecoreports.com

IN THE MIDDLE EAST FOR 30 YEARS

ASSET MANAGEMENT SALES LEASING

VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION

RESEARCH DEPARTMENT

NEWS BRIEF 34 SUNDAY 30 August 2015


IN THE MIDDLE EAST FOR 30 YEARS Page 2



REAL ESTATE NEWS

UAE

GCC CONSTRUCTION CONTRACT VALUES FALL AS A RESULT OF CHEAPER

OIL UAE DEVELOPERS SHRUG OFF LOW OIL PRICES, STOCKS CRASH

DUBAI

DEPA REPORTS A 44% DECLINE IN H1 PROFIT AS PROJECTS HIT BY DELAYS

MAJESTIC ENGLISH-STYLE HOME ON PALM JUMEIRAH IS YOURS FOR DH45M

DUBAI TO CREATE COMPULSORY REGISTER FOR PROPERTY SURVEYORS DUBAI PROPERTY SLOWDOWN ‘DUE TO TIGHTER RULES, NOT OIL SLUMP’

OMNIYAT TO LAUNCH ANOTHER DH1BN HOTEL IN DUBAI’S BUSINESS BAY WITHIN 12 MONTHS

FIVE-STAR IN DUBAI NOT QUITE THE SAME IN SRI LANKA ADDITION OF HOLIDAY HOMES FOR LEASE PUTS PRESSURE ON HOTEL

SECTOR IN DUBAI OMNIYAT TO OPEN DH1BN LANGHAM PLACE HOTEL IN DUBAI’S BUSINESS

BAY DUBAI CONTRACTOR DRAKE AND SCULL APPOINTS NEW CFO

CONSTRUCTION CONTRACT AWARDED FOR TOWN SQUARE TOWNHOUSES IN DUBAI

FORT ISLAND EXPANSION TO BE COMPLETED BY OCTOBER DUBAI HOLIDAY HOMES TO NEARLY DOUBLE BY YEAR-END NOOR BANK IN HOME FINANCING DEAL WITH DUBAI PROPERTIES

DUBAI’S REALTY MARKET IN THE GRIP OF A BEAR HUG PACE OF DEVELOPMENT SHIFTS TOWARDS DUBAI’S ‘SOUTH’

BENTLEY TO DESIGN DH55M VILLAS ON DUBAI'S SWEDEN ISLAND DUBAI'S COSTLIEST FLAT: DH181 MILLION @ ONE ON PALM JUMEIRAH

APARTMENT ON SHORT-TERM LEASE IN DUBAI? DH100,000 FINE IF NOT LICENCED

APARTMENT ON SHORT-TERM LEASE IN DUBAI? DH100,000 FINE IF NOT LICENCED

REAL ESTATE PROJECTS TO SHARE DUBAI SPOTLIGHT





ABU DHABI

FAITHFUL AND GOULD APPOINTED COST CONSULTANT ON AL MARYAH CENTRAL PROJECT

LANGHAM HOSPITALITY IN TALKS TO OPEN HOTEL IN ABU DHABI AS PART OF REGIONAL EXPANSION

NORTHERN EMIRATES

SHARJAH UNVEILS DH20 BILLION CITY OF 200 TOWERS, 1,100 VILLAS...





REAL ESTATE PROJECTS TO SHARE

DUBAI SPOTLIGHT

SATURDAY 22 AUGUST 2015

A shortlist of 37 real estate projects from 15 countries will compete for the Cityscape Awards for

Emerging Markets.

Winners from each of the 13 categories will be announced in a ceremony at Conrad Hotel, Dubai, on

Tuesday September 8.

The awards feature alongside Cityscape Global, the Middle East’s largest and international real estate

event, taking place from September 8 to 10 at Dubai World Trade Centre.

Holley Chant, Executive Director, KEO International Consultants, and a member of the judging panel,

said that sustainability is critical to the success of humanity’s future and real estate developers have an

important part to play in its realisation.

“The quality of the nominations in the Sustainability category for Cityscape Awards for Emerging Markets

this year were fantastic,” said Chant. “Projects seemed to really understand that the importance of a

sustainable building is not just about being green, but also about serving as a great project from a real

estate fundamentals’ point of view.

“We have developments that have truly made a positive social, economic and cultural impact on their

communities, as well as being environmentally sound.

“With sustainable design now a code requirement in the UAE, designers have had to accept this level as

the new standard and as a result are challenging themselves even more to create better and more

aspirational designs which differentiate their expertise and products in the market.”

The 13 award categories include completed projects and projects still under construction across the

following sectors: Commercial Project; Mixed Use Project; Leisure & Hospitality Project; Community,

Culture & Tourism Project; Residential Project; Retail Project; and Sustainability.

Woods Bagot, along with contractor Brookfield Multiplex, is one of the UAE finalists to be shortlisted for

two separate categories, hoping to be successful in the Built Commercial Project category and the

Sustainability category for its IRENA Headquarters project.

Richard Fenne, Principal, Woods Bagot, said: “Should the IRENA Headquarters building win the

Cityscape Awards it would be a great regional recognition of the collaborative effort the teams from

Masdar, Woods Bagot and Brookfield Multiplex have undergone to design and deliver an exemplar office

building.

“Sustainable developments play a crucial role in the ongoing growth of the real estate market, locally,

regionally and globally. The UAE takes a leading role in sustainability in this region, and is very much at

the forefront with benchmark developments such as Masdar City.”

Source: Gulf News

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APARTMENT ON SHORT-TERM LEASE IN

DUBAI? DH100,000 FINE IF NOT

LICENCED

SUNDAY 30 AUGUST 2015

Are you leasing your apartment on a short-term basis in Dubai?

If so, then apply for a licence now, or you will face a fine that could go up to Dh100,000.

A regulation issued under Decree No. (41) of 2013, regulating the activity of leasing out holiday homes

in Dubai, stipulates offenders can face fines of up to Dh100,000 if they have repeated the same violation

within one year from the date of the previous offence.

“The amount of the fine will be doubled, provided the fine does not exceed Dh100,000.“The Chairman of

the Executive Council will determine, pursuant to a resolution issued by him in this regard, the

prohibited acts and the fines to be imposed on the perpetrators of these acts,” states the decree.

Caught, first-time offenders will face a fine of not less than Dh200 and not more than Dh20,000, the

decree states.

Last week, the Department of Tourism and Commerce Marketing (Dubai Tourism) said 37 operators

have been licenced to rent out holiday homes, with close to 800 units registered in the holiday home

system.

However, hundreds of individuals are still advertising their apartments online as holiday homes, with

monthly rentals almost twice what normally rented-out apartments cost.

“We have made great progress in setting up regulations for holiday homes.“These are designed to

benefit both home owners and guests, by ensuring the holiday home market is aligned with the rest of

Dubai’s tourism industry and maintains the high standards for which the emirate is known,” said Khaled

Bin Touq, Executive Director, Licensing & Classification Sector at Dubai Tourism.

“Visitors can choose from a wide range of holiday homes throughout the city, knowing that the property

and operator are fully licenced and will meet all of their requirements.

“We, therefore, urge all operators and owners renting out holiday homes to ensure their properties are

licensed through Dubai Tourism in order to benefit from being part of Dubai’s tourism framework and

from the city’s increasing number of visitors.”

The decree ensures visitors booking their accommodation through licensed operators are assured that

the property they are booking is of a certain quality, has the appropriate insurances and is managed by

a qualified party.

Dubai Tourism is responsible for regulating the holiday home market with the objective of bringing the

segment in line with the regulation of the hotel sector as the emirate is aiming to welcome 20 million

visitors per year by the start of the next decade.

Source: Emirates 24/7

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UAE DEVELOPERS SHRUG OFF LOW OIL

PRICES, STOCKS CRASH

WEDNESDAY 26 AUGUST 2015

UAE developers are not in a mood to put the brakes on their development plans even though global

stock markets have collapsed and oil prices are in a slump.

Oil prices dropped by more than seven per cent to close at $42 a barrel on Monday after a rout on global

equity and commodity markets. Despite the global economic worries, local developers have started

construction work on their projects.

Latest to join the launch pad is Omniyat Properties, which along with Langham Hospitality Group, an

international hotel operator in Hong Kong, announced on Monday the Dh1-billion Langham Place

Downtown Dubai in Burj Khalifa district.

“The launch of Langham Place Downtown Dubai complements the emirate’s strategic tourism vision to

annually attract 20 million visitors by 2020. By then, we will have delivered over 1,500 hotel rooms and

suites,” Mahdi Amjad, Executive Chairman, Omniyat, said in a statement.

The project consists of a five-star luxury hotel and serviced apartments, adding 438 units to the

hospitality sector in the emirate on completion in 2018. (Supplied)

The project consists of a five-star luxury hotel and serviced apartments, adding 438 units to the

hospitality sector in the emirate on completion in 2018.

The hotel, comprising 167 rooms, will feature facilities including Michelin Star restaurants, four distinct

food and beverage outlets, a rooftop bar and lounge, and a salon that will serve the brand’s signature

afternoon tea.

“Dubai continues to receive demand for premium developments. We expect a strong response to the

launch of the serviced apartments that will welcome global investors starting October,” said company

Managing Director Mark Phoenix.

On Sunday, Emirates 24|7 reported Sharjah Oasis Real Estate Development Company had launched

Sharjah Waterfront City, a mega project costing between Dh18.5 billion and Dh20 billion.

Glitz in the making

Danube Properties has recently awarded the main construction contract for the Dh300-million Glitz 1

and 2 in Dubai Studio City to Naresco General Contracting, a local contracting company.

“Currently, the enabling work on both sites is four months ahead of the planned schedule and a

combined workforce of over 500 people is expected to execute the construction work during peak

season,” Rizwan Sajan, Founder and Chairman of Danube Group, said.

Atlas Foundation Company has been awarded the earthworks contract for Glitz 3 and is currently

undertaking mobilisation work on the site.

“Shoring and excavation work is scheduled to commence by month-end,” Sajan said.

Town Square taking shape

Nshama, a private developer, has also awarded the construction contract for its Zahra and Hayat

townhouse communities in Town Square to Beaver Gulf Group.





“Town Square is now taking concrete shape with work on the project ongoing ahead of schedule,” said

Fred Durie, Chief Executive Officer, Nshama.

Town Square is located in close proximity to Arabian Ranches Golf Course and Al Maktoum International

Airport. The master development will have over 3,000 townhouses, 18,000 apartments, retail,

hospitality and commercial space.

Off-plan launches

In August 2015, Lookup.ae, a real estate portal, said Dubai saw launch of 120 off-plan projects in the

past two years.

This website reported in June 2015 based on Reidin.com data that the emirate had seen launches of 14

new projects in the first five months of 2015 compared to 37 project launches announced during same

period last year.

Earlier this year, JLL and Knight Frank, global property consultancies, said property prices were set to

decline by up to 10 per cent this year.

Moody’s Investors Service, an international ratings agency, has said government spending on

infrastructure and foreign investments in various sectors will support the real estate market over the

next five years.

Dubai is expecting Dh25 billion in total investment in infrastructure-related projects in the run-up to

Expo 2020 with nearly 277,000 new jobs being created.


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SHARJAH UNVEILS DH20 BILLION CITY

OF 200 TOWERS, 1,100 VILLAS...

TUESDAY 25 AUGUST 2015

A new waterfront city is being built in Sharjah at the cost of between Dh18.5 billion and Dh20 billion that

will accommodate 200,000 people upon completion of 10 natural islands, which will be connected by

bridges and canals, Emirates 24|7 can reveal.

Comprising 10 islands, Sharjah Waterfront City will be spread across 36 kilometres of coastal land on

the northeastern coast of the emirate.

And that’s not all.

The city will have 200 mixed-use towers, 95 apartment buildings, offering affordable luxury apartments,

multi-level hotels and service apartments, over 1,100 water-front and park-side villas, marine clubs, a

shopping mall, two entertainment centers and mosques, schools, banks, stores, coffee shops and

restaurants.

Hayssam El Masri, President, Sharjah Oasis Real Estate Development Company. (Supplied)

“We have commenced work on the infrastructure after securing the required approvals from the

government authorities.

“The project will cost between Dh18.5 billion to Dh20 billion,” Hayssam El Masri, President, Sharjah

Oasis Real Estate Development Company told Emirates 24|7.

“We will officially launch the project at Cityscape 2015. We are expecting to complete the first phase,

which includes mixed-use towers, villas, hotels and a commercial centre, by third quarter 2018 and will

cost us Dh9.35 billion.”

The first phase will be spread across a plot area of 3.05 million square feet with a total construction area

of 15.22 million square feet.

El Masri revealed the second phase is expected to be completed by 2020-2021, stating, “The project will

be developed in multiple phases, keeping in mind the market dynamics.”

On completion, Sharjah Waterfront City will have a total area of around 60 million square feet –

becoming one of the biggest real estate developments in the emirate.

Crystal Lagoon

Among the major highlights will be ‘Crystal Lagoon’, a water theme park, El Masri said.

“We are working to complete all the formalities for the theme park, which will be spread across 1.5

million square feet. It will be a family destination, with entertainment and fun rides.”

Overall, the project is expected to become a major tourist destination and support Sharjah Tourism

Vision 2021, the strategic plan developed by Sharjah Commerce and Tourism Development Authority

that aims to attract 10 million tourists by year 2021.

Giving emphasis on creating an environment-friendly city, the developer has devoted 60 per cent of

project area for landscaping (beaches, gardens, parks).

Project finance





El Masri disclosed the company is in talks with financial institutions and private investors to raise funds

for the project.

“We are in talks with various institutions and investors. Besides, we will raise funds by selling land,

signing strategic alliances and even launching real estate funds,” he added.


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DUBAI'S COSTLIEST FLAT: DH181

MILLION @ ONE ON PALM JUMEIRAH

SUNDAY 23 AUGUST 2015

A Dubai developer is seeking Dh181 million for a penthouse in a Dh2-billion tower on the Palm Jumeirah,

making it the most-costliest apartment up for sale in the emirate.

The unit is listed by Omniyat Properties in the One at Palm Jumeirah.

The listing on its website reveals the 42,477.58 square feet penthouse has eight bedrooms and seven

bathrooms.

The internal area is 25,836.59 square feet with the balcony area being 16,640.99 square feet.

The unit will come with 12 parking spaces, offering full sea and Dubai Marina skyline views.

Work has commenced on the tower, which is being built jointly by Omniyat and Drake & Scull

International, according to an earlier company statement.

The 25-storey tower, comprising 90 apartments, is scheduled for completion by 2017.

It will have indoor and outdoor swimming pools, a cinema, cigar lounge, super luxury spa and yacht

club.

The luxury tower is designed by international architects including Soma from New York, Super Potato

from Japan and Vladimir from Lebanon.

Previously, Emirates 24|7 reported that the costliest apartment sold in 2014 was for Dh60 million - a

unit in Burj Khalifa, the world’s tallest tower.

Currently, the most expensive listing in the world is worth Dh1.47 billion ($400 million) for a quintuplex

penthouse in Odeon Tower in Monaco, which boasts an infinity pool linked by a slide.


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BENTLEY TO DESIGN DH55M VILLAS

ON DUBAI'S SWEDEN ISLAND

FRIDAY 21 AUGUST 2015

The Armanis, Versaces and Bulgaris of the world have already entered Dubai’s luxury real estate

market, now Bentley is steering in to design luxury villas on The World islands.

Kleindienst Group, developer of The Heart of Europe (THOE) on The World, has teamed up with Bentley

Home for the 10 luxury villas on the Sweden island, which are priced at Dh55 million.

“Excavation has commenced on Sweden island and concrete work is about to begin. The first villa will be

fitted out and furnished during the first quarter of 2016. The remaining nine Sweden villas will be

completed by December 31, 2016, in time for a Swedish-themed New Year’s Eve extravaganza on the

island,” the company said.

THOE is made up of Sweden, Germany, Monaco, Main Europe, Switzerland and St Petersburg Island.

Synonymous with the very best of European designs, culture and heritage,

Each villa will feature high-end home interiors provided with Bentley furniture being inspired by the

craftsmanship and material selection that characterize and follow the design philosophy of Bentley car

interiors.

“The range of handmade furniture is inspired by the techniques, materials and high quality finishes that

are synonymous with Bentley car interiors,” the company claimed.

Designed by famous architect Carlo Colombo, the design of each seven-bedroom residence is inspired by

the intricate structure of inverted Swedish Viking vessels with the roof of each villa resembling the

upturned hull of a Viking ship.

Special features include snow and sauna rooms, floor-to-ceiling windows, expansive balconies, a gym

and spa, a private infinity pool and landscaped gardens.

In December 2014, Josef Kleindienst, CEO, Kleindienst Group, told ‘Emirates24|7’ that the villa could be

priced between Dh30 million and Dh40 million.

“The island will not only be home to the finest Swedish architecture and design, but it will also bring the

best of Swedish culture and lifestyle to Dubai. We want to ensure people are genuinely able to

experience Sweden on The Heart of Europe, through food, music, festivals, traditions and architecture,”

he had said.

THOE comprises six islands: Germany, Austria, Switzerland, Netherlands, Sweden and St. Petersburg

with six additional destinations being Sochi, Belgium, Luxembourg, Geneva, Monte Carlo and Poland.

The project will have rain and snow-lined streets.


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PACE OF DEVELOPMENT SHIFTS

TOWARDS DUBAI’S ‘SOUTH’


If the pace of build-up continues in the newer locations, it will help unclog the heavy pressure on Dubai’s

established residential neighbourhoods and — at some point — even help ease the high rentals.

With newly named ‘Dubai South’ as the epicentre — the location formerly known as Dubai World Central

— new projects and advanced infrastructure works are starting to benefit locations further away such as

IMPZ (International Media Production Zone), the latest expansions at Dubai Investments Park, Jumeirah

Village and Sports City.

The sprawling Dubai Industrial City is another major beneficiary, not just as a magnet for manufacturing

and logistics assets but even residential offerings. (A self-contained city-within-a-city, Dubai South plays

host to Al Maktoum International Airport and all of the attractions that will make up the Expo 2020

mega-event.)

“In locations such as IMPZ and Jumeirah Village, plot values are holding up quite well and even

recording gains with each new top up in features in the area,” said Raj Sahni, founder of RSG

International, which has just completed its first project at IMPZ. “Plot values are comfortably upwards of

Dh100 a square foot. At these prices and available plot sizes, there’s a lot a sub-developer can do.

“And there are other factors too that will aid bring in new buyer interest — such as the opening of the

new Majid Al Futtaim Group owned shopping centre (Me’aisem) at IMPZ.”

Meanwhile, land prices in Dubai Industrial City and areas around it currently range between Dh125-

Dh150 a square foot of built-up area, according to Sailesh Israni of Sun and Sand Developers.

“Most of these areas are planned as integrated townships — not only is land available for industrial

purposes but also for residential,” said Israni. “So people associated with industry can stay close by. “As

long as the infrastructure is ready, people do not mind relocating to such areas.

“It will be at the newer clusters that Dubai’s need for affordable homes will be met. Land values at the

more established communities are at levels that there’s no way a developer will be able price anything

within an affordable price band.

“Private developers are willing to take Dubai’s real estate development to the city’s outer limits. And

potential property buyers — end-users principally — will only be too willing to join them.”

Clearly, in setting the tone for Dubai’s next stage of property evolution, Dubai South’s impact will not be

confined to a change in name.


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DUBAI’S REALTY MARKET IN THE GRIP

OF A BEAR HUG

SATURDAY 29 AUGUST 2015

The UAE’s real estate sector is caught in a tight bear hug. And it’s not limited to what has been

happening to property and construction stocks listed on the local bourses.

With a few exceptions, the first-half financials for the property majors have ranged from indifferent to

abysmal. Union Properties saw a precipitous decline in revenues by 55 per cent in the first six months of

the year from a year ago, while its net profit took a 93 per cent dive.

Deyaar, meanwhile, took a 72 per cent hit on its revenue numbers, but profit got a 24 per cent boost

from one-off write-back of provisions.

Emaar, in contrast, pushed out another set of solid numbers — a revenue gain of 28 per cent, which

brought on net profits that were up 19 per cent. Damac Properties was another to show off all-round

gains, with net up 50 per cent plus to Dh2.65 billion on revenues of Dh4.79 billion.

These numbers reinforce — more than anything else — the need for developers to think beyond their

core operations. In a soft market, and with no clarity on when it might end, it helps if the company can

call upon steady income from non-core activities.

“A few developers manage to “smooth” out their earnings by diversifying their revenue streams into

annuity based areas such as lease portfolios,” said Sameer Lakhani, Managing Director of Global Capital

Partners. “This is exactly what Emaar has done.

“With a large land bank, the company has managed to stagger their launch schedule and have an

execution record that has resulted in high levels of investor confidence. More importantly, the company

derives 45 per cent of its revenues from hospitality and leasing, which is more “annuity” based

cashflows rather than deal-based closures.” (Even then, Emaar’s revenues from property sales were up

40 per cent in the first-half, mirroring a “flight to quality” on the part of cautious investors, according to

Lakhani.)

Deyaar this week will unveil the first phase of an ambitious project first announced at last year’s

Cityscape in Dubai. While it recently launched the third phase of its flagship Green Community

development, Union Properties has kept its options open on taking on additional ones, even further

afield.

On the plus side, the debt levels at Emaar, Deyaar and Union Properties are deemed as “more or less

stable”. For the latter two, current liabilities — those due in less than one year — are at 62 per cent and

55 per cent respectively.

But if property buyers continue to maintain a hands-off relationship with Dubai realty, things could turn

quite dire and more so for contractors.

Even without this, Arabtec’s shares have had a hammering in recent months, as shareholders’ concerns

mounted over changes at the senior management level and a lack of additional details on the company’s

status on its Egypt projects.

Which would have repercussions for ‘contractor financing’. One reason could be that projects get

delayed from clients in response to a slow real estate market. Or, as raising debt becomes difficult due





to market conditions, developers will delay payments to the contractors, exerting pressure on the

latter’s balance-sheets.

“Arabtec’s current debt as a percentage of total debt is 79 per cent,” said an analyst. “This clearly has

sparked concerns contractors will have “funding issues” as they look to complete their projects; which in

turn will delay project executions and thus their profitability.”

At DSI (Drake Scull International), profitability fell 52 per cent in the first-half, though revenues were

higher by 2 per cent.

Arabtec’s numbers moved into negative territory, even though that was more due to internal

restructuring. The company has been going through boardroom turnover “and this has clearly impacted

broader investor sentiment as well”, the analyst added.

“These concerns have been amplified by the fact that revenue in the first-half fell 4 per cent, suggesting

that even though the pipeline remains large, the company may have to elongate the duration of project

execution.”

So, much rides on whether the market is able to shrug off its current inertia, and if so can the

turnaround be done quickly enough.

Rohit Chawdhry, Head of Asset Management at Gulf Baader Capital Markets in Oman, paints a rather

bearish outlook.

“There seems to be a lot of slack in terms of housing supply versus demand in the region’s real estate

sector, and particularly in the UAE,” said Chawdhry, who is also sceptical about whether the Dubai

property market can actually get the anticipated lift from the removal of sanctions on Iran.

“Dubai’s real estate sector has traditionally been a favourite with Iranian investors. Post sanctions, there

is likely to be requirement to have project funding back home in Iran.

“Hence, this demand is expected to slow down. The recent H1 figures may be masking this “stealth

weakness” in UAE real estate. Though H1 numbers were either in-line or above expectations, the

forward outlook may not be that encouraging.

“From a macro perspective, if the historical relationship between GDP growth and property yields is

expected to persist, then the weak Purchasing Manager’s index for UAE (proxy for UAE GDP growth)

could likely signal more weakness in real estate.”

Clearly, for developers, property buyers and stock market investors, the short-term is not for the faint-

hearted.


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NOOR BANK IN HOME FINANCING DEAL

WITH DUBAI PROPERTIES


Noor Bank has signed up with Dubai Properties to provide financing for a selection of both completed

and off-plan properties, including those at the Mudon, Remraam and The Villa projects.

Financing will be available for up to a 25-year tenure at ratios of up to 80 per cent for UAE nationals and

75 per cent for expatriates on completed projects and 50 per cent for off-plan ones. The financing

amounts can go up to Dh25 Million.

Noor Bank has also assigned a dedicated team for the developer. “Judging by the huge uptake for the

first phase of the Mudon community cluster, we perceive an exceptionally strong demand for properties

in carefully masterplanned, and well-located residential communities from homebuyers, ranging from

young professionals to large families,” said Abdulla Abushabieb, Executive Director, Sales and Customer

Care, Dubai Properties .

Under the financing options, customers can avail Noor Bank’s home equity release solution, which

provides finance of up to Dh10 million. In addition, clients who are looking to reduce monthly

instalments during the initial years of the finance can use the recently launched ‘Flexi Home Finance’ for

ready properties.

Source: Gulf News

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DUBAI HOLIDAY HOMES TO NEARLY

DOUBLE BY YEAR-END

MONDAY 24 AUGUST 2015

Dubai is expected to see a boom in holiday homes in the coming months, with the number of registered

homes expected to jump from around 800 as of last month to 1,500 by the end of this year, according

to an official from the Department of Tourism and Commerce Marketing (Dubai Tourism).

The emirate is broadening its range of accommodations through holiday homes, which will help it

achieve its target of 20 million visitors per year by 2020, Dubai Tourism said in a statement on Monday.

“As our tourism offer grows and tourism numbers continue to increase, so does the need for a variety of

accommodation options,” Khaled Bin Touq, executive director, licensing and classification sector at

Dubai Tourism, told Gulf News in an emailed statement.

The number of licensed operators of holiday homes in Dubai has reached 37 as of July 2015, according

to the statement. Bin Touq expects the number of operators to grow to 100 within the next three years,

and to 200 within the next five years.

Holiday homes are relatively recent additions to Dubai’s tourist accommodations, according to Rashid

Abu Bakr, associate director at TRI Consulting.

“DTCM [Dubai Tourism] started accepting registration applications from qualified operators sometime in

mid-2014. With new regulations, this market is expected to grow substantially in Dubai in the future as

evident from the travel trends emerging from other parts of the world,” he said.

He added that holiday homes in Dubai attract tourists from European, Gulf and Asian families, as well as

medium to long-stay business travellers.

These homes see demand from Europeans, who are spending less abroad given the weaker euro against

the US dollar to which the UAE dirham is pegged, and their familiarity with the concept, he said.

“When budgets are constrained, people look at these kinds of accommodation. They are typically more

affordable than hotels,” he said.

Lower residential rents in Dubai are likely to encourage more property owners to operate their

properties as holiday homes, which is “subject to the licensing requirements, to accommodate short and

long stay guests in a bid to boost yields,” according to Abu Bakr.

Residential rents dropped by an average of 3 per cent in June, according to a report by Abu Dhabi

Islamic Bank (ADIB) and MPM Properties.

The holiday homes market is regulated by Dubai Tourism. The department is responsible for approving

licence applications, conducting property inspections to ensure required standards are met and creating

a database of all licensed properties in the emirate.

Source: Gulf News

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FORT ISLAND EXPANSION TO BE

COMPLETED BY OCTOBER


Madinat Jumeirah expects the expansion of its Fort Island property to be completed in October this year,

Jumeirah Group , which owns and operates the property, said in a statement on Monday.

Covering over 1,750 square metres, Fort Island is anticipated to be the largest hotel event space in the

UAE, Jumeirah stated. It added that the space will be used to host parties, exhibitions, weddings, sports

events and festivals, among others, with a capacity of up to 1,400 people.

The expanded island is also expected to increase the Madinat Jumeirah Conference Centre’s overall

capacity to 9,000 people.

“We look forward to catering for a larger and wider range of prestigious events for the meetings,

incentives, conference and events (MICE) industry,” stated Margaret Paul, the resort’s general manager.

Fort Island, which was built in 2003, will be connected to Madinat Jumeirah by four bridges. The resort

also plans to launch Jumeirah Al Naseem, a 430-room hotel that is set to open in 2016. As part of its

expansion, Madinat Jumeirah will also have a villa complex, restaurants and a commercial centre with

retail outlets, which will be completed in March 2016.

Source: Gulf News

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CONSTRUCTION CONTRACT AWARDED

FOR TOWN SQUARE TOWNHOUSES IN

DUBAI


The flagship development at Nshama’s Town Square project in Dubai has taken a further step forward

with the construction contract for its Zahra and Hayat Townhouses awarded to Gulf Beaver Group.

“Town Square is now taking concrete shape with work on the project ongoing ahead of schedule,” said

Fred Durie, Nshama chief executive.

“The contract with Beaver Gulf for the construction of the Zahra and Hayat Townhouses is another

milestone highlighting our commitment to timely delivery.”

Town Square is a 750-acre development with a central square equivalent to 16 football pitches. It is

located near Arabian Ranches and is planned to feature more than 3,000 townhouses and 18,000

apartments.

The townhouses were launched earlier this year, with three-bedroom units starting at Dh999,998.

Mr Durie added that both communities had gained “tremendous response from end-user customers”.

Last month, Nshama awarded contracts for the Zahra and Safi apartment blocks to Dubai-based United

Engineering Co (Unec), marking the first stage of construction of the Town Square project.

Source: The National

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DUBAI CONTRACTOR DRAKE AND

SCULL APPOINTS NEW CFO


The Dubai-based contractor Drake and Scull International (DSI) has appointed Sam Deeb as its chief

financial officer with immediate effect, the firm said in a bourse filing on Monday.

The statement did not reference who Mr Deeb replaces.

Mr Deeb was formally CFO of the Abu Dhabi-based family conglomerate Al Jaber Group, whose core

business is construction.

He was suspended in April, 15 months after taking on the role, ahead of what the company said at the

time was “disciplinary action”, without elaborating on its nature.

The statement also said that Graeme White has been appointed as DSI’s chief commercial officer.


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OMNIYAT TO OPEN DH1BN LANGHAM

PLACE HOTEL IN DUBAI’S BUSINESS

BAY


The developer Omniyat has agreed a deal with Langham Hospitality Group, a Hong Kong-based hotel

operator, to open a new Langham Place hotel in the Business Bay area of Dubai.

The 6,325-square-metre site will house a 167-room hotel and 271 serviced apartments – 438 units in

all.

It will also have four food and beverage outlets, including an all-day restaurant and a rooftop bar. The

building will be completed in 2018. The total project cost is Dh1 billion, according to Omniyat.

Speaking at a signing ceremony at the Langham Hotel in Hong Kong, Mahdi Amjad, Omniyat’s executive

chairman and chief executive, said Dubai had “evolved dramatically” with tourism numbers doubling

over the past decade to more than 10 million, and a further doubling expected by 2020.

He said Langham Place “adds another prestigious brand” to its portfolio, adding that it was currently

developing properties with four hotels and more than 1,500 rooms.

Lo Ka Shui, the executive chairman of Langham Hospitality Group, said he was confident about his

company’s ability to fill the property, despite the growing pipeline of Dubai hotels.

He said the 100 million Chinese who made overseas trips last year were “just the tip of the iceberg” in

terms of potential visitors, with more than 2.3 billion tourism visits made within China last year.

Mr Lo said Langham’s experience in Hong Kong showed that it could cater well to the market, as its

hotel drew about 50 per cent of its weekend visitors from mainland China, compared to about 30 per

cent at rival hotels in the territory.

Omniyat has a portfolio of properties worth about US$4.4bn, and Mr Amjad said that had increased in

size by about 25 per cent annually over the past two to three years.

He expects to add properties worth $1bn to its portfolio by the end of this year.

“We will continue to grow as long as the region is growing and the demand is there,” he said.


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ADDITION OF HOLIDAY HOMES FOR

LEASE PUTS PRESSURE ON HOTEL

SECTOR IN DUBAI


Holiday homes are adding new capacity to Dubai’s hospitality industry amid declining occupancy rates

and profit margins at hotels.

About 800 units have been registered with the emirate’s holiday home system, as 37 new hospitality

operators entered the market, according to Dubai Tourism.

Dubai residents need the permission of their landlord and the Department of Tourism and Commerce

Marketing to put a holiday home up for lease.

Airbnb, a rental website offering short-term accommodation, lists more than 1,000 rooms to rent in

Dubai, with a current average nightly price of Dh381 per room.

Regulated holiday home operators are only part of the new supply of rooms in the emirate.

Tens of thousands of hotel rooms are expected to be added to Dubai’s tourism-led economy ahead of

Expo 2020.

Dubai has about 65,000 hotel rooms, and aims to increase this figure to about 100,000 by 2020.

Hotel operators are expected to add 3,600 new rooms by the end of the year, most of which will be mid-

range or cheaper, according to real estate consultancy JLL.

Increased competition from holiday homes is likely to hurt hotels that have suffered hits to their bottom

line as tourism to the emirate slows.

Occupancy, revenues and profits are at a low ebb as declining global oil prices and the strong US dollar

make holidaying in Dubai more expensive.

Economic woes in Russia and Ukraine– big tourism markets for Dubai – have also hit visitor numbers.

And there is a risk that financial headwinds in China could dent the double-digit growth rate of Chinese

visitors to the emirate.

Monthly data from consultancy STR Global provided a boost to Dubai hotels last month, with revenue,

capacity utilisation and profitability all increasing.

But the changing dates of Ramadan make it difficult to compare tourism figures for July last year and

the same month this year.

Ramadan took place during the entire month of July last year, but it took place during just two weeks of

July this year. That means that the seasonal increase in tourism took place during the second half of last

month.

Piers Schreiber, a vice president of corporate communications at the Jumeirah Group, shrugged off the

effect of Dubai’s slowing economy on the hotel operator.





“We have a very diversified customer base. As one market weakens, another strengthens. Even in

previous downturns we have managed to maintain strong business returns,” he said.


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FIVE-STAR IN DUBAI NOT QUITE THE

SAME IN SRI LANKA


I learnt two lessons from my recent summer travels: don’t trust the international star-rating system of

hotels; do trust the judgements of Cairo’s camel drivers. Let me explain.

I got back from a very enjoyable 10-day trip to Sri Lanka last week. Many friends had recommended the

“teardrop” in the Indian Ocean, and I was not disappointed.

It ticked all the holiday boxes for me and six-year-old Amira: endless white beaches washed by crashing

breakers, spooky jungle surroundings complete with dripping palms and simian screeches, and animals

– elephants, monkeys, turtles, snakes, even the vaguest, shadowy glimpse of a leopard.

There was plenty to keep me interested apart from the wildlife. We stayed on the south coast, which

had been badly hit by the 2004 tsunami, and it was fascinating to see how ordinary Sri Lankans had

suffered in, and recovered from, that tragedy.

The fact that more than 10 years on they are still coming to terms with the disaster is testimony to the

violence of the event, and their determination to recover.

I booked the trip via the DIFC branch of Sharaf Travel. It’s quaint these days to actually use a travel

agent, as several friends pointed out, but the Sharaf agent was from Sri Lanka, so I valued his local

knowledge.

Maybe he could have arranged for something better than the bone-breaker jeep that took us round Yalla

national park on our leopard hunt. But the roads were so bad I suspect even a top of the range safari-

adapted Land Cruiser would have made little difference.

I’d take issue with him in only one area. I’d insisted on five-star accommodation throughout the trip,

and he complied, but without telling me that there is a wide disparity between Dubai definitions of five-

star and those of Sri Lanka.

The Cinnamon Bey hotel, in Beruwala on the south-west coast, might be billed as a “five-star resort”,

but it’s a long way from Dubai’s standards of five-star luxury and comfort. We compensated by paddling

around the coral reef just off the resort beach, which kind of made up for it.

Before Sri Lanka I went on a trip to Egypt to report on president Abdel Fattah El Sisi’s unveiling of the

“new” Suez Canal. It was (inexplicably) my first visit to the country, and a stirring occasion, made all

the more memorable by the emotional reaction of the local press corps to the event.

All pretence to objective journalistic detachment went out the media tent window as hacks and

hackettes applauded, whooped, and jumped on tables to lead chants of “Sisi, Sisi” as the president

declared the canal extension open.

And why not? The canal is some good news for the country, supported and welcomed by the vast

majority of the people, as far as I could tell, despite the curmudgeonly doubts of economists and the

foreign media.

To get a real feel for the popular mood, I asked the camel driver who accompanied me on my tour of the

pyramids the next day how he felt about the new canal.





“It is good for Egypt and good for us. The president has made a big thing of it, we know, but he is all we

have standing between us and bad things. Without him, Egypt would be like Libya and Syria, and the

Middle East would be lost,” said Mohammed, a married family man in his mid-thirties.

I reckon you could pay a strategic consulting firm millions of dollars and get more or less the same

verdict.


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OMNIYAT TO LAUNCH ANOTHER DH1BN

HOTEL IN DUBAI’S BUSINESS BAY

WITHIN 12 MONTHS


Omniyat is set to launch another Dh1 billion hotel project in Business Bay in Dubai within the next 12

months, says Mahdi Amjad, its executive chairman.

The company is in talks to bring in another hotel operator to the city following the deal it announced

with Langham Hospitality Group yesterday. The ME by Melia hotel, announced in 2013 and designed by

the internationally acclaimed architect Zaha Hadid, is also due to open at The Opus building in 2017.

“We try to bring in new brands and attract a new audience to the city. And try to really add our touch to

the skyline of Dubai. We owe that to the city,” Mr Amjad said.

The Dh1bn Langham Place launch brings the total value of Omniyat’s portfolio up to US$4.4bn.

This includes a number of projects under development, including Anwa at Dubai Maritime City, The

Sterling apartment block at Business Bay, and the One at Palm Jumeirah, a joint venture with Drake &

Scull.

Mr Amjad said Omniyat was in the final stages of enabling works at One at Palm Jumeirah, where the

company recently listed Dubai’s most expensive apartment – an eight-bed property with 12 parking

spaces for Dh180 million.

Tendering for the project’s main contractor has been completed and a contract will be awarded within

the next 30 days, allowing for the project to be completed by the end of 2017.

We have gone from an empty piece of land with great potential to create one of the most prestigious

residential buildings in the city,” he said. Prices at One at Palm Jumeirah start at Dh15m for a 350

square metre apartment. The Dh180m apartment is about 4,000 sq m in size.

“We have only 90 apartments on a site of close to 1m sq ft,” said Mr Amjad.

Elsewhere, work is already under way at Anwa, a development of 220 apartments and five town houses

in Dubai Maritime City. Kele Contracting is the main contractor. It is also due for completion in 2017.

A contract for a main contractor for The Sterling, which will have 139 homes and a retail unit in two

G+25 towers, is due to be awarded by the end of the year.

“We still have a few plots in Business Bay, but not a lot,” said Mr Amjad.

“We are very, very pleased with our investment in Business Bay. When we bought it, it was a military

camp that had just been evicted back in 2004. We were very fortunate to be given that opportunity, and

we made good use of that.”

According to property consultancy JLL, the global market for hotel investments is booming –

transactions in the first half of the year rose 55 per cent to a record of $42bn from the year-earlier

period. The market had been driven by a wealth of foreign investment, said JLL.





The biggest single deal was the $2bn purchase of a 64 per cent stake in the London-based Maybourne

Hotel Group that includes The Berkeley and The Connaught hotels. It was bought by Qatar’s

Constellation Hotels Group.

“Investors are looking for scale in what is becoming a very competitive market,” said Mark Wynne

Smith, the chief executive of JLL’s hotels and hospitality division.


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LANGHAM HOSPITALITY IN TALKS TO

OPEN HOTEL IN ABU DHABI AS PART

OF REGIONAL EXPANSION


Langham Hospitality Group is in talks to open a property in Abu Dhabi as part of a region-wide push that

is also targeting Oman, Qatar, Saudi Arabia, Bahrain and Lebanon.

“We’re working on something in Abu Dhabi. We think that’s an attractive market,” said Robert Warman,

its chief executive, adding that no timeline had been set for its opening.

“It’s hard to say … We’re in preliminary discussions.”

The Hong Kong group this week signed a deal with Omniyat, a UAE developer, to open its second Middle

East property in Dubai’s Business Bay.

The 438-unit Langham Place hotel and serviced apartment buildings have been designed by Soma

Architects and are due to open in 2018.

Its first property will be a Langham Hotels and Resorts property on Palm Jumeirah in Dubai, which is

being developed by Das Holding, an investment holding company backed by Sheikh Mansour bin Zayed,

the Minister of Presidential Affairs and Deputy Prime Minister.

The property is due for completion in the first quarter of 2017.

“It’s well under construction,” Mr Warman said. “The main structure is finished; the remaining part is

landscaping and interiors.”

He said that Langham would typically develop not more than two luxury hotels in one city, but felt it

could afford to do this in Dubai because they serve different markets. The Palm property is a beach

resort hotel, while Langham Place is a contemporary, city-style hotel.

“Our customers are telling us we need to be in more locations. For years, we’ve been predominantly in

the Far East, but we’ve expanded in North America,” said Mr Warman.

Langham Hospitality’s Middle East push has also led it to sign two deals in Qatar for a Langham Hotels

and Resorts outpost in Doha and a Langham Place in Lusail.

A deal has also been signed to build a 150-room resort hotel in the hills above Beirut.

“Bahrain is continuing on, and Oman has great potential for not only a city hotel but also a resort. It

seems like Egypt is settling down and we think that Cairo will be a great market in the future,” said Mr

Warman.

He also expressed his keenness to set up hotels in Riyadh and Jeddah as Saudi Arabia diversifies its

economy and more foreign investment pours into the kingdom.

Citing Langham Hospitality’s popularity among a growing band of Chinese travellers and its brand

recognition among GCC travellers who use its hotels in London and New York, Mr Warman voiced

confidence in his company’s ability to fill the hotel rooms in Saudi Arabia even as competitors step up

their presence in the market.






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DUBAI PROPERTY SLOWDOWN ‘DUE TO

TIGHTER RULES, NOT OIL SLUMP’


Dubai’s tighter property rules aimed at preventing a housing bubble are the main cause of a slowdown

in the emirate’s real estate sector rather than a sustained drop in oil prices, industry experts said.

Dubai has a low reliance on oil despite hydrocarbons providing three-quarters of the UAE’s consolidated

revenue in 2014, according to credit agency Moody’s. Abu Dhabi is home to the bulk of the UAE’s energy

reserves.

“Dubai residential property sales have declined over the past three quarters, but the drop in oil prices is

coincidental and the slowdown is more due to big price increases in 2013 - the market is adjusting to

return to affordable levels,” said Nicholas Maclean, managing director of consultants CBRE Middle East.

“This is a positive trend and will help prevent a bigger correction in the future.”

While housing prices are expected to drift lower this year, some experts said well-balanced supply and

demand for properties should keep prices stable.

Rival consultancy Cluttons estimates house prices in Dubai rose 51 per cent during 2013 before growth

slowed to 3.4 per cent in 2014. This rebound followed a near-50 per cent drop in prices from 2008 as

the global financial crisis and Dubai’s debt troubles sparked a real estate crash.

Last year, Dubai doubled property registration fees and the UAE federal government raised the minimum

mortgage deposits, dampening demand.

“The government was right to act to curb speculation. It’s just that these measures have now coincided

with a weakening global economy,” said Faisal Durrani, head of research at property consultants

Cluttons.

The impact of the new rules on house sales has been acute, said Mr Durrani, predicting further declines

in prices in the second half of 2015.

Cluttons forecasts about 20,000 new residential units will be completed and handed over from now until

2017. About 41,000 units have been announced this year.

“Unit delivery and population expansion seem well matched, which indicates the residential market

should be pretty stable,” added Mr Durrani.

Yet prolonged low oil prices could lead to a UAE construction slowdown, with the government the main

real estate facilitator through infrastructure spending and state-linked developers that dominate the

market.

“Oil is likely at unsustainably low prices - we should see a rebound, which will substantially increase

government revenues in the medium term, but the question is when will that rebound happen?” CBRE’s

Mr Maclean said.


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FAITHFUL AND GOULD APPOINTED

COST CONSULTANT ON AL MARYAH

CENTRAL PROJECT


Faithful and Gould, a London construction and engineering consultancy, has been appointed as a cost

consultant on the first phase of Gulf Related’s US$1.5 billion Al Maryah Central project in Abu Dhabi.

The announcement about Faithful and Gould follows the appointment of the Australian contractor

Brookfield Multiplex last month. Work is set to start on the site this month and finish in March 2018.

Al Maryah Central is a 3.1 million square feet mixed-use project. Of that, 2.3 million sq ft of retail space

will feature 400 stores, 145 restaurants and cafes, a 20-screen cinema, a medical centre, a creche, a

public library and other facilities.

It will house the first Macy’s department store outside the United States and the first Bloomingdale’s

store in Abu Dhabi.

Subsequent phases of the development will include residential units and a hotel in two high-rise

buildings. “Our proven track record in the region’s retail sector for ensuring our clients’ requirements are

met – in respect of cost, time, quality and safety – was a key factor in our appointment,” said Donal

O’Leary, a director at the consultancy.

Faithful and Gould is part of the UK building consultancy Atkins.

Gulf Related is a joint venture between Abu Dhabi’s alternative asset fund manager Gulf Capital and the

New York property developer Related Real Estate.


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DUBAI TO CREATE COMPULSORY

REGISTER FOR PROPERTY SURVEYORS


Dubai’s Executive Council has passed a resolution to create a law governing standards for surveyors and

property valuers.

The new law will mean that that people who assess property values will need to possess certain

qualifications and be registered with Dubai’s Real Estate Regulatory Agency (Rera).

Qualified practitioners will need at least two years’ worth of valuation experience, although trainees can

also be registered, subject to passing certain qualifications.

Rera will be given the power to decide whether surveyors are allowed on to the register and what

existing licences should be renewed. It will also look into complaints against property valuers.

The move is aimed at preventing unlicensed and underqualified professionals from valuing properties.

Assessors will only be able to act for one party when completing a valuation – be it a bank or a property

client.

Any breaches of Rera’s rules will lead to fines, which will be doubled if offences are repeated. Rera will

also be able to suspend, or even revoke, permits for those who continue to breach its rules.

Sultan Butti bin Mejren, the director-general of the Dubai Land Department, welcomed the resolution,

which was passed by the executive council’s chairman, Sheikh Hamdan bin Mohammed, Crown Prince of

Dubai.

Mr bin Mejren said the move would “contribute to enhancing the transparency and credibility of the real-

estate market in Dubai” by putting in place rules about who is authorised to value properties.

This will, in turn, serve the banking sector well by giving greater confidence in home valuations.


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MAJESTIC ENGLISH-STYLE HOME ON

PALM JUMEIRAH IS YOURS FOR DH45M

THURSDAY 27 AUGUST 2015

While many villas on Palm Jumeirah have a similar look, the ‘signature’ villas that Nakheel cleverly

spread across the 16 fronds of Palm Jumeirah claim an exclusivity and style sometimes missing

elsewhere.

Each villa has a built-up area of 7,000 square feet on a 13,000 sq ft plot size. These villas come in

several architecture themes and floor plan layouts ranging from five to seven bedrooms.

From the exterior, this villa, on the end of Frond C, has an aspect and retro styling befitting a majestic

English home sitting atop a tor overlooking the local copse. With its white turrets it is possibly

incongruous, but placed on an artificial, palm shaped island with the backdrop of Dubai’s towering

Marina it somehow sits perfectly.

• Take a look around the property here

The villa has upgrades throughout so while it may resemble its neighbours externally, it has a very

individual feel inside.

Of course, as befits a Palm villa, it offers its own beach and a private infinity pool, gym, staff quarters

and double garage. And at Dh45 million, the price also fits the location.

This villa sits in the middle of the Signature range with six double bedrooms including a master suite

that has been extended to include a large en suite and walk-in wardrobe/dressing room.

The property, being marketed by real estate agent Knight Frank, also offers a kitchen which could easily

substitute for the bridge on a space ship such is the brushed steel finish, pearly white facade and

carefully curved appliances that adorn the walls.

The kitchen is so eye-catching it has been incorporated as the heart of the house flowing into one of

three reception rooms.

If you buy this villa the time saved schlepping around the likes of Ikea may be the deal breaker as it is

offered fully furnished.

Q&A

Gregory Lewis, senior negotiator at Knight Frank, tells Andrew Scott more about this Dh45m Palm

Jumeirah villa:

Is the Palm still the No 1 destination for high-end living in Dubai?

Yes it is. Looking at the government data there have been several transactions over the past two years

exceeding the Dh4,500 [per square foot] mark with some reaching as high as the Dh7,000 mark.

Secondly, the Palm offers non GCC nationals the only option to purchase property with beach frontage

which naturally attracts wealth. Thirdly, given that investors/end users are now developing the plots

that were sold by Nakheel on the fronds on the Palm, we are seeing some extremely large properties

being erected. It would be fair to say some of these match Emirates Hills properties for sheer square

footage.

But is it a good place to live in terms of amenities?





At present there are approximately two to three grocery shops which simply isn’t enough to cater for the

Palm population. However with new developments being built (in-between building 10 Shoreline & Tiara)

which will offer supermarkets as well as eateries, along with the Palm mall which is currently under

construction, this should meet demand. Traffic is actually quite free flowing. Where there are lights only

for pedestrian crossings, it’s rare to see large tail backs unless there is a large concert or event.

Is all the construction of villas on the Palm complete now?

No, there are still remaining fronds in which plots were purchased from Nakheel. Some are under

construction, but some have not yet commenced. Also there are several ‘tip’ plots that have not yet

been developed. So watch this space.


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DEPA REPORTS A 44% DECLINE IN H1

PROFIT AS PROJECTS HIT BY DELAYS


The Dubai fit-out contractor Depa revealed a 44 per cent drop in net profit for the first half of the year to

Dh15 million.

Revenue also fell back by 4 per cent to Dh841m in the same period.

The company blamed the lower profit figure on cost revisions on a few major projects, as well as extra

costs incurred as a result of delays. Gross margins slipped to 10 per cent of revenue, down from 13 per

cent in the first half of last year.

The decline in sales was due to a smaller backlog at the start of last year, which the firm attributed to its

more selective approach in bidding for contracts.

The company added, however, that its project pipeline has since been replenished “with a number of

high-quality contract wins”.

Although its backlog at Dh2.32 billion is 3 per cent lower than at the same time 12 months ago, it is

almost 12 per cent higher than at the start of this year.

The group chief executive Nadim Akhras said the company had been encouraged by its performance

both in mature European and Far Eastern markets and in emerging markets in Africa and South Asia.

“Following several challenging years for the industry in our core UAE market, we are also cautiously

optimistic about the recent pick-up in fit-out activity, which we anticipate will continue in the second half

of the year,” he said

“Despite global economic issues that had a negative impact on several of our key markets, the work we

have done to further streamline and diversify the business in recent years leaves Depa well positioned

over the coming period.”

The company finished work on 37 contracts during the first half of the year, including hospitality projects

for Hyatt, Novotel, Sheraton and Ritz Carlton hotels. It also completed retail fit-outs for Dior, Louis

Vuitton, D&G, Michael Kors and Pottery Barn.

According to a new report on the GCC’s retail construction market by Ventures Onsite, which tracks the

construction industry, there are US$28bn (Dh102.8bn) worth of retail projects either planned or under

way in the GCC.

The biggest new project is Dubai Holding’s $6.8bn Mall of the World on Sheikh Zayed Road.

The project will include a theme park, shopping malls, shopping precinct, wellness zone and hotels.

The next in size is the $1.65bn Doha Festival City in Qatar. Three of the top five new centres are in

Doha, including the $1.37bn Place Vendome and the $830m Mall of Qatar schemes.

A number of existing mall operators are undertaking significant extensions.

The Kuwaiti developer Mabanee is spending $914m to add a fourth phase to its successful The Avenues

project in Kuwait City, while Majid Al Futtaim Properties is planning a $500m extension of Mirdif City

Centre Mall.





Emaar Malls Group is also spending $381m adding more space to its flagship property, The Dubai Mall.

“Retailers are expected to benefit from the Expo 2020, which will be instrumental in bringing an influx of

more visitors to the country,” the Ventures report said.

“The Expo is expected to spur in economic activity and translate into a growth of over 33 per cent in the

UAE’s retail sector by 2025.”

Depa’s shares are listed on the Nasdaq Dubai exchange. The shares last traded on Sunday, when they

gained 2.2 per cent.


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GCC CONSTRUCTION CONTRACT

VALUES FALL AS A RESULT OF

CHEAPER OIL


The value of contract awards for GCC construction projects in 2015 is likely to be US$194 billion – down

$2bn on last year’s total awards of $196bn, according to a new study.

The GCC Construction Industry – Trends and Challenges for 2015 report produced by research firm

Ventures Onsite for The Big 5 trade show argued that the fall could be attributed largely to the decline in

oil prices, which has lowered the cost of transport and building materials, thereby feeding into lower

contract value awards.

Overall, it said the GCC’s construction market maintained “sturdy” activity levels.

Saudi Arabia remains the region’s biggest market, with the lion’s share at 44 per cent share, followed by

the UAE (31 per cent), Qatar (11 per cent) and Kuwait (6 per cent).

For much of this year, Ventures Onsite had been expecting contract awards to increase by 4.5 per cent

and hit $205bn by year-end, but it revised estimates downwards, blaming speculation about Qatar’s

hosting of the 2022 Fifa World Cup for pushing back the timing of some deals.

Andy White, the vice president of The Big 5 show organiser DMG Events ME, said: “A lot has been said

about how oil prices might affect construction markets. But each of the GCC nations has continued to

invest heavily in infrastructure such as housing, and health care.

“Kuwait has more than trebled its contract awards this year, the Saudi government has made it clear

that it will continue to invest, and the UAE has revealed more spectacular projects.”

“ The GCC Secretariat-General has also announced that the Gulf Rail network is meeting construction

deadlines and is on track to meet its 2018 deadline.”

UK-based contractor Carillion revealed this week that revenue within its Middle East construction

services division, which includes joint ventures in Al Futtaim Carillion in the UAE and Qatar, as well as

Carillion Alawi in Oman, jumped 54 per cent in the first six months of the year to £326.5m, from the

year-earlier figure of £212.6m. Underlying profit for the business was up by 43 per cent to £18.9m,

from £13.2m a year ago.

Carillion said that the Middle East division’s sales were up on the back of a number of contracts won last

year, and that profit climbed following a reorganisation of staff accommodation facilities, which

“generated a greater benefit than expected”.


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With 30 years of Middle East experience, Asteco’s Valuation & Advisory Services

team brings together a group of the Gulf’s leading real estate experts.

Asteco’s network of offices in Abu Dhabi, Al Ain,

Dubai, Northern Emirates, Qatar, Jordan and the

Kingdom of Saudi Arabia not only provides a deep understanding of the local markets but also enables us to undertake large instructions where we can

quickly apply resources to meet clients requirements.

Our breadth of experience across all the main

property sectors is underpinned by our sales, leasing and investment teams transacting in the market and a wealth of research that supports our decision making.

John Allen BSc MRICS

Director, Valuation & Advisory

+971 4 403 7777

[email protected]

Julia Knibbs MSc

Manager – Research and Consultancy - UAE

+971 4 403 7789

[email protected]

VALUATION & ADVISORY

Our professional advisory services are conducted

by suitably qualified personnel all of whom have

had extensive real estate experience within the

Middle East and internationally.

Our valuations are carried out in accordance with

the Royal Institution of Chartered Surveyors

(RICS) and International Valuation Standards

(IVS) and are undertaken by appropriately

qualified valuers with extensive local experience.

The Professional Services Asteco conducts

throughout the region include:

• Consultancy and Advisory Services

• Market Research

• Valuation Services

SALES

Asteco has established a large regional property

sales division with representatives based in UAE,

Saudi Arabia, Qatar and Jordan.

Our sales teams have extensive experience in the

negotiation and sale of a variety of assets.

LEASING

Asteco has been instrumental in the leasing of

many high-profile developments across the GCC.

ASSET MANAGEMENT

Asteco provides comprehensive asset

management services to all property owners,

whether a single unit (IPM) or a regional mixed

use portfolio. Our focus is on maximising value

for our Clients.

OWNER ASSOCIATION

Asteco has the experience, systems, procedures

and manuals in place to provide streamlined

comprehensive Association Management and

Consultancy Services to residential, commercial

and mixed use communities throughout the GCC

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SALES MANAGEMENT

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comprehensive and encompass everything

required for the successful completion and

handover of units to individual unit owners.

Documents

NEWS BRIEF 34 - Asteco Property Management · 2016-05-29 · Downtown Dubai in Burj Khalifa district. “The launch of Langham Place Downtown Dubai complements the emirate’s strategic