Dubai fair rolls out property projects
Dubai - Dubai developers are rolling out scale models for the city’s latest grandiose property projects despite continued drops in real estate prices.
Shimmering skyscrapers, golf-course villas and houses in sprawling communities are on show at Cityscape Global 2016, an exhibition with a growing a reputation as the venue for launching the emirate’s mega-projects.
The centrepiece of the fair was Jumeirah Central, an entire district with a mixture of residential and office blocks, hotels and a mall, along Dubai’s Sheikh Zayed Road. The project is being developed by state-owned Dubai Holding, the creator of the luxurious, sail-shaped Burj Al Arab hotel.
Emaar South was a new development announced just before Cityscape by Emaar Properties, which built Burj Khalifa, the world’s tallest tower, among other Dubai landmarks.
It is to be built in Dubai South, a vast desert that hosts Dubai’s second airport Al-Maktoum, which is planned to become the world’s largest and replace Dubai International Airport as the base for Emirates Airline.
“It is really amazing to get the chance to keep expanding this city,” Emaar Chairman Mohamed Alabbar said. “Keep in mind that we are (only) 40-plus years old… We are really young as a country and as a city and there is a lot to do.”
On the first day of Cityscape Global 2016, Nakheel — the developer behind the man-made archipelago of Palm Jumeirah — announced an apartment complex that it said would “dominate” the skyline.
Dubai became a magnet for property investments when it opened the sector to foreigners in 2002, standing out in a region that mostly confines freehold ownership to citizens.
The value of property surged at breakneck speed until the global financial crisis hit the debt-laden emirate in 2009, sending prices into free-fall.
A recovery led by tourism, trade and transportation pushed prices up again in 2012-14 and stirred fears of another bubble before they eased again at a slow pace.
Prices have dropped about 15% since peaking in mid-2014, according to a report by property consultancy Jones Lang LaSalle. Another consultancy, Cluttons, said prices “continued to soften” across the residential market in the second quarter of 2016, losing an average 2.4%.
Cluttons said the average price per square foot stands at $375, which it said was almost 25% below the “market peak” in the third quarter of 2008.
“We see the residential real estate market bottoming out by the end of this year,” said John Stevens, managing director of Asteco real estate services. “We’ve seen some slight decline but certainly we expect the market to be stable.”
Transactions amounted to $15.5 billion in the first half of the year, according to official statistics, with Emirati nationals topping the list with deals worth $3.49 billion. The rest were snapped up by foreigners, led by Indian investors with transactions worth $1.9 billion, while Saudis and Britons clinched deals totalling $1.08 billion each.
“External factors over the years have always affected the appetite from certain countries,” said Stevens.
These included the effects of the falling Russian ruble in 2015 and the British pound this year following the Brexit vote.
However, interest is coming from elsewhere.
“You’ve seen interest coming from other marketplaces. Certainly in the past 12 months, we’ve seen much greater interest from China, for example,” said Stevens.