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Dubai part 2
Dubai ranks second in global office real estate
construction activity
Monday, October 2nd, 2006 Posted by Overseas Property Mall in Property
Industry News, International Real Estate Trends, UAE Property, Dubai
Property
With over 24 million square feet of commercial office space currently
under development, Dubai has been ranked a close second in the world in
terms of office real estate construction activity by Colliers
International - one of the top three global property service
consultants.
According to the company’s mid-year Global Office Real Estate review,
which assesses the worldwide commercial property markets in 50
countries, only Moscow ranks higher with the Russian capital boasting an
estimated 26.90 million square feet of ongoing commercial property
construction.
John Davis, CEO, Colliers International - Middle East, said:
‘It is no surprise to see Dubai so close to the top in terms of
construction activity. This go-ahead emirate has been making massive
progress in recent years with development steaming ahead at an
incredible compound annual growth rate of 42.5 percent. Positioned to
become the business capital of the region, Dubai has implemented a
succession of world-class incentives to attract corporations, NGOs and
SMEs from across the globe.’
According to the Dubai Chamber of Commerce and Industry (DCCI), the
emirate’s nominal GDP grew 27 percent in 2005 - more than five times the
global average. Buoyed by massive increases in non-oil dependant
industries, Dubai is generating strong demand for commercial office
space.
‘Dubai currently boasts 14 million square feet of available primary and
secondary grade office space within its established Central Business
Districts (CBD’s), a relatively small amount considering the rapid
influx of foreign business and the development of indigenous entities
currently being undertaken here. Supply is quite simply not meeting
demand and developers are feverishly trying to correct the market,’
added Davis.
According to the report, Asia’s commercial construction industry is also
thriving. China’s ongoing economic boom was evident with Beijing and
Shanghai placed third and fourth in the global rankings with 23.58
million square feet and 21.61 million square feet respectively of office
space under construction. In addition, Tokyo Central Wards, Guangzhou,
Kuala Lampur and Hong Kong, were ranked nine through 12 respectively.
Ranked fifth was South Africa’s most populous city, Johannesburg, which
is currently undertaking 17.87 million square feet of office space
construction.
Only one European city finished in the top ten rankings, Paris, which is
currently undertaking 14.61 million square feet of commercial
development.
Investments in Saudi property market soar to SR1
trillion :: MENAFN
Saturday, February 4th, 2006 Posted by Overseas Property Mall in Saudi
Arabia Property
JEDDAH — Real estate is the fastest growing sector in Saudi Arabia with
more than SR1 trillion in investments. The growth is said to be the
second highest in the world after Shanghai, according to Solaiman Al-Majed,
Chairman, Tanmiyat Group.
But the burgeoning market needs to be regulated and organised in order
to avoid scams, of which there have been quite a few, as well as achieve
continuous progress and maintain investor confidence.
Apart from businessmen, thousands of ordinary Saudis have invested their
money in real estate, in the expectation of large profits. But according
to financial analyst Abdelmenem Jamil Addas this was not a healthy
trend. “People think that they are seeing the dawn of a new era in the
real estate market, that it will bring unimaginable riches and
prosperity to all. This overconfidence will have dangerous consequences
on our economy,” he added.
He said that the recent rise in real estate prices was being fuelled by
artificially low short-term interest rates and a huge increase in bank
loans. “We should not forget that as soon as interest rates rise, the
rally in real estate prices will come to an abrupt end,” he explained.
“Any market that is rising because of an increase in bank’s loans ought
to be viewed with great caution,” he said.
According to Dr. Abdul Aziz Turkistani, a real estate expert, the real
estate boom has led to the creation of many professional companies.
“These firms,” he says, “are working to improve their organisational
structure and marketing strategy in order to transform the sector into a
successful industry.” He felt that real estate companies in the Kingdom
should form an association to promote the industry with a view to facing
competition from foreign firms.
Wafa Al-Ghamdi, an expert in the field, said there was a professional
approach and a chaotic way of developing and marketing real estate. The
professional approach relied on market studies, market analyses and
meeting customer demands. “The Saudi real estate market still depends on
old methods and does not meet customer demands, especially middle and
lower class families,” she said. Among the problems the Saudi real
estate market faced was the domination of a few investors, lack of
studies, lack of laws protecting the investors and customers, lack of
transparency in dealings and the reliance on rumours to promote
properties. “There is also lack of market awareness among customers,
particularly women, and agents take advantage of the women’s lack of
knowledge,” Al-Ghamdi said.
A Jeddah Chamber of Commerce and Industry (JCCI) working team recently
made a number of proposals to make the business transparent and
foolproof protect the rights of investors and ensure steady growth.
The boom has been attributed to the continuous repatriation of Saudi
funds from overseas and increasing liquidity supported by soaring oil
revenues.
Government projects and initiatives provide major opportunities for the
private sector. They also continue to ensure that the construction
industry remains the largest non-oil economic sector in the Kingdom. It
was estimated to have contributed more than $15 billion to the national
economy in 2005.
Recognising the need to diversify and reform its economy, the government
has provided incentives and relaxed laws. This has boosted the private
sector’s enthusiasm for heavy investments in residential and commercial
buildings. It is estimated that 555,000 individuals will need new
housing annually. This gives ample scope for developers. It equates to
100,000 new residential units a year. Additionally, the Kingdom is also
developing its tourism industry (largely local and religious tourism)
and it is expected to contribute $22 billion to the economy by 2023.
The Kingdom’s new Real Estate Law allows non-Saudi residents to own real
estate for their private residence with the permission of the Interior
Ministry. It also allows ownership of real estate by foreign investors
to conduct their business activities and to own properties needed for
their accommodation and that of their employees. The law also entitles
investors to rent out property.
According to Abdul Monem Murad, chairman of the real estate development
committee at JCCI total investments in 53 real estate share businesses
across the country have reached more than SR14 billion.
Abdul Rahman Al-Jeraisy, chairman of the Riyadh Chamber of Commerce and
Industry (RCCI), is spearheading a joint venture with other businessmen
to set up a large real estate company in Riyadh with a capital of SR30
billion. He said the new company would have a strong presence all over
Saudi Arabia. His estimate is that five million housing units would be
required by 2010.
Sama Dubai commences construction work on ‘The Lagoons’
mega-project in Dubai
Friday, May 5th, 2006 Posted by Overseas Property Mall in Dubai, New
Development Alert, Dubai Property
Sama Dubai, the international real estate investment and development arm
of recently announced the start of construction work on ‘The Lagoons’
project, situated on theDubai Holding, Dubai Creek.
The Lagoons’ project is the first of its kind and is expected to
catalyze Dubai’s position as an international destination, with seven
independent island projects designed according to a comprehensive study
of environmental effects.
Farhan Faraidooni, CEO of Sama Dubai, said:
‘We are keen to implement all project phases by 2010 as previously
announced.’
The project has attracted a number of local and Gulf investors since its
launch and more than 20% of the allotted lands for sale were sold out
within the first two weeks, Faraidooni noted.
Faraidooni pointed out that consultation with different international
and local organizations and stakeholders such as Dubai Municipality,
World Wide Fund for Nature (WWF) - UAE office, as well as the Wildlife
Protection Office (WPO) - Dubai, has been ongoing and that the project’s
environmental excellence is a cornerstone of the development.
It is worth mentioning that ‘The Lagoons’ is set to be a signature
development within the booming property sector that has developed in
Dubai over the past four years. The project will help enhance the city’s
diversity and multicultural character and add to the development of its
residential and tourist population.
‘The Lagoons’ ‘ many attractions will provide tourists staying in one of
the many five star hotels with a plethora of entertainment venues
including over 50 shopping malls, retail arcades, health spas and parks.
Residents as well as visitors will also be able to enjoy a number of
cultural attractions such as the theater, museum, arts center and opera
house. ‘The Lagoons’ offers luxury villas and apartments overlooking the
creek with scenic yacht marinas and waterways, not to mention commercial
towers and state of the art facilities catering to the local and
regional business community.
Dubai makes waterfront plans
Thursday, May 18th, 2006 Posted by Overseas Property Mall in Property
Industry News, UAE Property, Research, Dubai Property
DUBAI, United Arab Emirates There is no stronger belief in the saying,
“If you build it, they will come” than in Dubai.
Because it has the smallest oil holdings of the seven United Arab
Emirates, Dubai has chosen to diversify by building itself into a
tourist and trading mecca. In the past decade, development has exploded,
from the ultra-luxury Burj Al Arab hotel to business zones like Dubai
Media City and attractions bordering on the surreal, like Ski Dubai, an
indoor ski slope 400 meters, or 1,300 feet, long.
Now, on the emirate’s last remaining undeveloped land fronting the Gulf,
the government is building a city called Dubai Waterfront. At the
moment, it is a vacant beachfront dotted with cranes. When it is
finished, it will be a self-contained community larger than Manhattan,
with housing for 700,000 people.
“People think it is a dream, but people are wrong,” said Khaled Issa Al
Huraimel, general manager of the project for the developer Nakheel.
“What we start here, we finish.”
Dubai’s population of 1.2 million is projected to grow to 4 million by
2020, and tourist arrivals are expected to grow to 22 million a year
from 8 million. “At the moment, we don’t have the capacity to handle
that,” Huraimel said.
Planning for the new city began in 2002, and a master plan was developed
last year with the New York architectural firm Gruzen Samton.
Development of the infrastructure has begun, and the entire city is
expected to rise from the sand - and the water, on a series of
artificial islands - over the next 10 years.
When it is finished, the city will form a giant crescent arching around
The Palm, a palm- tree-shaped island resort and residential project so
big it is visible from space. The city will comprise five major
sections, with the centerpiece being the Madinat Al Arab, a city center
with businesses, shopping and one of the world’s tallest buildings, Al
Burj.
Huraimel said Al Burj might end up being the tallest building in the
world - it will be competing with the Burj Dubai, a mixed-use building
already under construction.
The planned heights of both buildings have not been disclosed.
“We won’t know until they are finished which one will be taller, but we
do know that the two tallest buildings in the world will be in Dubai,”
Huraimel said. (The world’s tallest building now is Taipei 101 on
Taiwan, at 509 meters.)
Dubai Waterfront will have 12 kilometers, or 7.5 miles, of natural
beachfront, 10 kilometers of canals and a harbor two kilometers wide.
There will be 10 mixed-use zones, ranging from residential areas to
commercial and retail space, resorts and areas for schools and
recreation. As many as 200 hotels are planned.
“It’s a blending of a city into communities,”‘ said Jordan Gruzen, a
partner at Gruzen Samton.
The residential zones will include housing aimed at middle-income
brackets as well as luxury homes, Huraimel said. “We do have to protect
the lower-income levels,” he said.
Luxury sales in the emirate have declined in recent months, with some
real estate specialists saying prices had reached unsustainable levels.
In the first phase of the project, Dubai Waterfront Co., a division of
Nakheel, is spending about $4 billion on the infrastructure of the new
city, including roads, a sewer system, desalination plants to ensure the
water supply, electricity and a light rail system. Huraimel said the
value of the land alone, before any improvements, was $30 billion.
Once that work is done, private developers will be sold individual plots
in the city, of which 70 percent will be residential and 30 percent
commercial. The first sites, prime areas along the downtown beachfront
zoned for residential and resort purposes, sold for $13 million in 48
hours in December. More will be sold this year.
The new city will be an equidistant 35 kilometers from the existing
Dubai city center and Abu Dhabi, and just a few kilometers from the new
Jebel Ali airport, which, with six runways, will be the largest in the
world.
Huraimel was confident that Dubai would attract the business and
residents to make the city work. “In 15 years, the perception of the
Middle East will change,” he said. “We are a modern, diverse society in
Dubai. The city is safe, there are no taxes, the weather is perfect for
at least nine months out of the year.”
Also, in March the emirate said it would allow foreigners limited
freehold ownership and formal 99-year leases, just one of the property
law changes being made across the UAE to attract investment.
But Huraimel conceded that Dubai had a big job to do in overcoming the
West’s negative image of Arab countries. “Some have said that Islam and
the West is a clash of civilizations,” he said. “Dubai is like a city of
dreams. This is not a clash of civilizations. This is the opposite.”
Gruzen and his team are already convinced.
“Dubai has absolutely amazed us,” said Joe Navarro, another senior
associate at the New York firm. “Each time we go there’s a higher degree
of confidence. This isn’t just a flash in the pan.”
Huraimel said that the new city would mesh with existing projects; the
city’s own light rail, for example, will link to the Dubai metro trains
now being built.
While the Gruzen architects have been involved with other large-scale
projects, including building a smaller city from the ground up in Iran,
the Dubai project is unique.
“They’re building their own factories to make products,” Navarro said.
“Anything you need is provided for. This is more than hype. It’s got
real money behind it.”
New ‘iPod’ style development – ‘The Pad’ Dubai - located
in Dubai Business Bay
Wednesday, May 9th, 2007 Posted by Overseas Property Mall in UAE
Property, Dubai, New Development Alert, Dubai Property
Earlier this month Omniyat Properties previewed their planned 230
apartment development, ‘The Pad’. Models of the building, to be designed
to look like an iPod MP3 player, were on display at Dubai’s
International Property Show 0n 3-5 April.
As an intelligent building the Pad will demonstrate prime specialisms of
Omniyat Properties ultimate parent, Almasa Holdings, namely IT and real
estate. Also known as ‘iPad’ the building will include lofts, studios
and one and two-bedroom apartments. According to Bloomberg (25th April),
apartments will cost up to AED 9m ($2.5m). The smallest units start at
581 sq. feet.
Starting prices according to Dubai based realtors GoWealthy.com are as
follows:
Studio US$343,688
1 Bedroom US$362,372
2 Bedroom US$901,158
Currently two-bedroom apartments in the more conventional West Wharf
development (also in the Business Bay area) are being sold for around
US$550,000. This is a development by Corporate Finance House scheduled
for completion about a year ahead of the Pad.
Futuristic intelligent features of the Pad will include the following:
• Rotating living and dinning rooms so as to enjoy views on either side
of the waterfront building
• Virtual panoramas from other parts of the world projecting on windows
(iReality)
• Video-conferencing in the dinning room
• Reactive lighting able to respond to your mood or even to telephone
calls (iAmbiance)
• Bathroom health monitoring equipment
The purpose of room rotation is aesthetic rather than the space-saving
device developed by Luigi Colani in Germany in recent years. The 360
degree views referred to in the Omniyat Property press release are not
clearly reflected in all of the floor plans but the feature will
certainly allow for the flexible use of the accommodation. Some
apartments appear from floor plans to also include rotating double beds.
At the time of its launch Omniyat made clear that it hopes to
incorporate robotic features into its developments such as robot vacuum
cleaning but that seems to be some way in the future.
Facilities for residents will include a retail area, parking, the iClub,
swimming deck, media Jacuzzi, underwater concert, media deck chairs,
aerobics section, lap pool, half basketball court, running track,
barbeque & gathering Area.
Almasa Holdings spun off its real estate division to form Omniyat
Property Development Corporation in December 2005. Last year Almasa set
up Omniyat Holdings as the holding company for Omniyat Property
Development and other property concerns with a paid-up capital of $100m.
Tejoori, the AIM listed Sharia compliant investment company took a 25%
stake in another Omniyat Holdings subsidiary, Omniyat Property Eleven
Ltd., in January 2007. Omniyat has sold a stake in one of it’s office
development to the Islamic Investment Bank of Bahrain and has also
signed an agreement with the Abu Dhabi Commercial Bank for mortgage
facilities for investors in another of its commercial developments.
The first phase of Omniyat Properties’ first residential project, the
Square, was sold out three days after launch.
As iPod owners pointed out when the project was first talked of, there
is no indication if allowance has been made for Apple changing the look
of their product by the time the Pad reaches completion in late 2009.
Others pointed out that iPad suggested the iPod by its proportions
rather than replicating the precise appearance of any specific model.
The Streets of Dubai
I’m on Day 42 of an extended trip to Dubai. Most people think of Dubai
as this incessantly sunny oasis in the desert where capitalism reigns
free, gleaming skyscrapers sprout out of ground, and the local Emiraties
and expats are living the good life. All this is true, but most people
don’t realize the other side of Dubai.
My previous trips to Dubai have been admittedly comfortable. Nice
hotels. Nice office space. Nice meals and drinks with other visiting
coworkers. This trip has been vastly different.
I’ve been staying in Sharjah for the past month, and making occasional
jaunts to nearby Dubai. It’s a 30 minute drive without traffic (key
word), and a US$15 cab ride away from Sharjah. This weekend (which is
Thursday and Friday), I moved to the Al Riqqa district in the part of
Dubai known as Deira. This is Old Dubai, where the first settlements
established themselves on the banks of what is know today as Dubai
Creek. I moved to be closer to the action. And to have the option to go
to the downstairs bar if I want a drink -- as previously written,
alcohol is illegal in conservative Sharjah.
Life can be hard in Dubai. Many of the laborers are from India,
Pakistan, Bangladesh, Sri Lanka, Egypt, and Iran. Many work outdoors in
the intense daytime heat, and are considered to be low-skilled labor –
which is reflected in their salary. My current project requires me to
supervise a group of local laborers, 18 of them. I am the only expat
onsite each and every day to supervise this work. It’s been quite an
experience – all at the same time…challenging, humbling, and lonely.
Society is boiled down to its basic nature - you see the hardships of
humanity, the relevance of hierarchy, and the fundamental need to make
money to survive.
The laborers have families in their home countries. They work six days a
week, send money home to support their families, and look forward to the
once-a-year visit home to be with their wife and children. Their
employers hold their passports, partly in case a laborer decides to
runaway, he will not go too far. European vacations, iPods, Stiletto
heels, US$10 drinks at the Lounge-of-the-Moment, Sex and the City, and
Botox are not on their radar screen.
Dubai.
The Freedom to Choose
A couple of weeks ago, I posted a screenshot of what happens when you
try to access a banned site in the UAE. I have some additional thoughts
and experiences since then.
The first is with Skype. Most know of Skype through eBay's recent
acquisition of Skype for an incredible US$2.6 billion. I didn't give the
technology much thought, only noting that it was a lot of money for a
service that didn't make much money -- but then they must know something
that I don't.
A few weeks ago, a Dubai-based business associate handed me a business
card with his Skype username on it. Again, not much thought except that
he must be a techie. Then shortly thereafter, a friend sent me an
invitation to Skype and after a painless download, we were chatting in
high quality voice-over-internet. We'll sort of. I don't have a
microphone, so they had to talk, while I typed my responses through
Skype's instant messaging interface. It was a bit creepy.
Etisalat is the Emirates Telecommunications Company. It's owned by the
Royal Family, as with many things in the UAE. It's also a monopoly. If
you want to use a landline, it's through Etisalat. If you want to use a
cell phone, it's through Etisalat. If you want to use the internet, it's
through Etisalat.
Recall from Business 101, monopolies have power in charging their own
rates for service - it's no longer market based. Long-distance phone
calls are incredibly expensive in the UAE. I found out for myself with
my 15 days of roaming in Dubai on my Hong Kong-based cell phone carrier
-- the bill came out to US$500. I learned a lesson the hard way.
There are some ways around Etisalat's high fees. My office uses VoIP -
Voice Over Internet Protocol for our phones. I think it's free. I have
the below phone, a Cisco IP 7960G. It's the first time I took affection
in a (non-mobile) phone. There are some quirks, such as the buzz that
eminates from the speaker when my mobile phone is about to ring -- some
sort of interference. Or the occassional echo on the other line -- but
can be usually solved with a quick call back on a better connection.
Another way around Etisalat's high fees is with Skype. I've dabbled with
Skype during after hours in the office, but an attempt today in my hotel
room led to the realization that Skype is a banned site in the UAE. Why?
Because it competes with Etisalat. How do I access it in the office?
Because of a proxy server located in Europe.
I suppose the takeaway from this post, is that freedom of choice is not
something to take for granted.
Desert Safari in Dubai and Oman,
UAE
Site Blocked!
Tonight, someone sent me a friend request on myspace.com. I clicked on
the link for myspace.com, and to my bewilderment, the site is banned by
the UAE.
"We apologize the site you are attempting to visit has been blocked due
to its content being inconsistent with the religious, cultural,
political and moral values of the United Arab Emirates."
Dubai Fast Facts
Some interesting factos on Dubai...
1. One of the seven emirates that makes up the United Arab Emirates.
2. Is the second largest emirate after Abu Dhabi.
3. Oil accounts for only 5% of the GDP. Most of the revenue comes from
trade and tourism.
4. Is 85% expatriate. Much of this is comprised of construction and
service industry workers from sub-Asia (India, Pakistan, Phillipines).
5. Has 22% of the world's cranes. Only China is bigger with 30% of the
share, with 18% in Shanghai. Look on a map and compare the landn area of
China to Dubai.
6. Construction workers work around the clock in three (3) 8-hour
shifts.
7. Has the world's only 7-star hotel. Rooms start at $1,500 per night,
and go up to $15,000 per night.
8. Has the world's tallest building under construction.
9. Is building 3 islands on reclaimed land. Two are in shapes of palm
trees, and one of the 7 continents of the World.
10. Has a 5 year waiting list for office space in Intenet City and Media
City (where I am typing right now).
11. Is 70% men. Not good.
12. Weekends are on Thursday and Friday. I work on Saturday and Sunday.
Oasis in the Desert
Some photos of Dubai. There's a whole lot of
construction here.
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