NEWS BRIEF 08 SUNDAY 23 February 2014
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ASSET MANAGEMENT SALES LEASING VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION NEWS BRIEF 08 SUNDAY 23 February 2014 RESEARCH DEPARTMENT DUBAI | ABU DHABI | AL AIN | SHARJAH | QATAR | JORDAN IN THE MIDDLE EAST FOR 28 YEARS © Asteco Property Management, 2013 asteco.com | astecoreports.com ASSET MANAGEMENT SALES LEASING VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION REAL ESTATE NEWS UAE PRICE CONFUSION CHOKES UAE PROPERTY MARKET POTENTIAL DUBAI DEVELOPER OF DUBAI LAGOON PROJECT ASSURES COMPLETION AFTER DELAYS DUBAI DEVELOPER DEYAAR TO ALLOW UP TO 25% FOREIGN OWNERSHIP SECOND PHASE OF ANANTARA THE PALM APARTMENTS TO GO ON SALE NAKHEEL RECEIVES SIX BIDS FOR PALM JUMEIRAH MALL CONSTRUCTION PROPERTY BURST ON PALM JUMEIRAH TO PROVIDE HUNDREDS OF NEW APARTMENTS CITYSCAPE SPIN-OFF NEXT MOVE LIVE TO LURE END BUYERS OF DUBAI PROPERTY BUSINESS BAY STAGES A COMEBACK AS DUBAI PROPERTY MARKET PICKS UP EMAAR LAUNCHES MIRA OASIS TOWNHOUSES IN REEM NAKHEEL LEASES RESTAURANT AND RETAIL SPACE AT THE POINTE AT PALM JUMEIRAH IT'S THE EASIEST WAY TO MAKE MONEY IN DUBAI HOSPITALITY AND RETAIL MAKE GAINS FOR EMAAR PROPERTIES IN 2013 DUBAI COLD CALLING CRACKDOWN: RERA URGES COMPLAINTS AGAINST ERRANT PROPERTY BROKERS ABU DHABI MELIA HOTELS AND BANYAN TREE PLAN TO OPEN BOUTIQUE HOTELS IN ABU DHABI ABU DHABI WAITS ON NEW STOCK AVAILABILITY WORK IN PROGRESS TO REOPEN CLOSED BEACHES ON SAADIYAT ISLAND KSA KINGDOM TOWER TESTING TO BEGIN AS 1KM SAUDI PROJECT AIMS HIGHER THAN BURJ KHALIFA AS WORLD’S TALLEST EMAAR TIES UP FOR NEW SAUDI PROJECTS NORTHERN EMIRATES LOCAL DEVELOPERS START TAKING NORTHBOUND ROUTE RAK CROWN PRINCE ISSUES THREE DECREES ON DEPARTMENTS OF MUNICIPALITY, LAND AND PROPERTY DUBAI | ABU DHABI | AL AIN | SHARJAH | QATAR | JORDAN IN THE MIDDLE EAST FOR 28 YEARS © Asteco Property Management, 2013 asteco.com | astecoreports.com Page 2 ASSET MANAGEMENT SALES LEASING VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION DEVELOPER OF DUBAI LAGOON PROJECT ASSURES COMPLETION AFTER DELAYS SUNDAY 23 FEBRUARY 2014 The developer of Dubai Lagoon project in Dubai Investment Park has confirmed funding in place to expedite the completion of the master development. "We have finalised funding for the project and the project will be built on a funding and off-plan sales model," a spokesperson for Schon Properties, the developer, told Emirates 24|7. "After the previous [property] crash, we will not rely solely on off-plan sales going forward to build the development, and have arranged partial funding for completion of the project," he revealed. The company will soon be disclosing details on funding ventures and new tie-ups. Dubai Lagoon is a master development comprising over 3,800 apartments in 52 low-rise buildings divided into seven zones, retail components, plus a community-catered shopping mall. A number of investors have claimed delays in completion of the project, having raised the issue with Real Estate Regulatory Agency (Rera), the regulatory arm of Dubai Land Department. The project, they claimed, was expected to be completed in 2008. When asked if old investors were still continuing with the project, the spokesperson said: "Nearly 97 per cent of our investors have continued with us. "We have faced three per cent default from purchasers who had purchased at high prices. "We have offered investors discounts of up to 40 per cent on outstanding invoices through the downturn and co-operated with existing buyers by shifting them to earlier completion zones." Schon Properties denies investor claims on work stopping on the project. Citing numerous reasons for delays, the spokesperson said: "There were many factors for the delay of the Dubai Lagoon project, despite our best efforts to avoid them. "The project was launched on January 2006, but a hold on the building permit was issued on March 2006 because of the Road and Transport Authority's Purple Line of the Metro being incorporated in master plan. DUBAI | ABU DHABI | AL AIN | SHARJAH | QATAR | JORDAN IN THE MIDDLE EAST FOR 29 YEARS © Asteco Property Management, 2013 asteco.com | astecoreports.com Page 3 ASSET MANAGEMENT SALES LEASING • VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION "After the new affection plan, given by Dubai Municipality and a new building permit was awarded in November 2007, the real estate market crashed in October 2008, decreasing sales by 98 per cent and decreasing collections by 95 per cent." He added that since 2008 until September 2012, the project was being built, albeit at a slower pace with almost Dh75 million being spent on construction for Zones 1, 2, 3 and 4 in that period. "During this period, the collection from existing buyers nearly stopped. "Since then, the collections from existing buyers have improved and with Expo 2020, the project is on track for expedited completion." It was in October 2012; Rera implemented a building-by-building completion policy, with work starting on building C12, the spokesperson said. The developer claims that work on the Zone 1 is nearly completed and handover is in the second half of 2014. The entire master development is expected to be completed by 2016. Asked what guarantees have been giving for completion to Rera and buyers, the spokesperson said that the company has offered penalty clauses on delays to existing and new buyers to compensate them for delay and to guarantee them completion of the project. Source: Emirates 24/7 Back to Index DUBAI | ABU DHABI | AL AIN | SHARJAH | QATAR | JORDAN IN THE MIDDLE EAST FOR 29 YEARS © Asteco Property Management, 2013 asteco.com | astecoreports.com Page 4 ASSET MANAGEMENT SALES LEASING • VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION DUBAI DEVELOPER DEYAAR TO ALLOW UP TO 25% FOREIGN OWNERSHIP MONDAY 17 FEBRUARY 2014 Dubai property developer Deyaar said today that it planned to allow foreigners to begin investing in its shares and hold up to 25 per cent of its share capital. At present, nationals from Gulf Cooperation Council countries can own up to 49 per cent of Deyaar’s shares; they currently hold 3.7 per cent, bourse data shows. Foreigners from outside the GCC have been prohibited. The Deyaar board’s recommendation will be subject to approval by the company’s shareholders in an extraordinary general meeting to be held soon. Shares in the company jumped 9.8 per cent on Sunday morning after the plan was announced. The move is part of a trend by companies in the United Arab Emirates and Qatar to review their foreign ownership caps before international index compiler MSCI raises those countries to emerging market status in May, which is expected to attract fresh foreign money. Union Properties, another Dubai property firm, is also seeking to increase its foreign ownership limit. Deyaar’s board also resolved that the company’s share capital is sufficient to meet future expansion and growth, the company said. Source: The National Back to Index DUBAI | ABU DHABI | AL AIN | SHARJAH | QATAR | JORDAN IN THE MIDDLE EAST FOR 29 YEARS © Asteco Property Management, 2013 asteco.com | astecoreports.com Page 5 ASSET MANAGEMENT SALES LEASING • VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION PRICE CONFUSION CHOKES UAE PROPERTY MARKET POTENTIAL MONDAY 17 FEBRUARY 2014 Unreliable and confusing data is distorting the UAE property market and risks inflating the market. That is the fear of some industry analysts who say investors are buying into vastly inflated figures that are fuelling speculation. There is still little publicly available official house price information for investors to tap beyond periodic reports from local and international brokers. Instead property brokers, property data companies, listings websites and banks fill the information vacuum pushing out their own statistics on sales and rents, which often contradict each other significantly. “In the current market where everybody is getting excited about real estate, asking prices rise more quickly than achieved prices, which means that the gap between the two is widening,” says Craig Plumb, the head of research at Jones Lang LaSalle’s Dubai office. “The lack of reliable information does cause distortion to the market. We believe that asking prices are currently probably around 20 per cent higher than achieved sales prices.” According to the property broker Asteco, house prices in Dubai increased by nearly 60 per cent last year. The website propertyfinder.ae reported a 45 per cent increase in average values in Dubai’s key neighbourhoods over the same period. And the property data company Reidin reported that they rose 22 per cent over the year. One reason for the significant discrepancies could be in the information that the three companies are providing. While propertyfinder.ae only analyses the asking prices provided in all 270,000 property listings it carried last year, Asteco attempts to provide actual sales price data, which is provided by its own property brokers combined with other market information. Reidin uses a combination of sale prices along with data provided by its own team of researchers who act as mystery shoppers and question property managers to find out information. “At the moment there is very little that individual buyers can do to find out reliable information about the market, but we believe this is an opportunity for the government and the industry to work together to provide more reliable information,” added Mr. Plumb. “In Dubai you can look on the Rera website and see how much rents are in the area. It would be great if there was something similar for prices.” DUBAI | ABU DHABI | AL AIN | SHARJAH | QATAR | JORDAN IN THE MIDDLE EAST FOR 29 YEARS © Asteco Property Management, 2013 asteco.com | astecoreports.com Page 6 ASSET MANAGEMENT SALES LEASING • VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION He adds that a lack of information about the amount of new homes being built has also created difficulties for developers because they tend to underestimate the number of new homes coming to the market through other developers and build more homes than the market can absorb.