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Life near the fast lane
The brakes are on at Al Raha Beach as Abu Dhabi prepares for the F1 Grand Prix at nearby Yas Island. But are homeowners in the area really in pole position?
- Laura Fulton; freelance writer; Freehold Monthly
- Published: 00:00 October 15, 2009
There are motor-heads and then there's Stew Murphy. The Australian has followed F1 since he was a child. He's travelled the world following the races and his fervour for his favourite Aussie driver, Mark Webber, has since translated into conducting PR for his compatriot in the GCC region. And when he heard that the F1 was coming to Abu Dhabi, Stew took the plunge and bought an apartment at Aldar's Al Raha Beach development, right across the water from the Yas Island track.
One of the last to purchase a flat in his building, Stew was not alone - an investment at Al Raha Beach promises to be a wise one for investors. Paul Maisfield, head of professional services at Asteco Property Management, Abu Dhabi, believes Aldar's development will transform the mainland into prime real estate. "In many cases, expatriates have rented properties off the island out of necessity due to both a lack of choice and the high rents being demanded on the island. The new and growing communities in these off-island areas, including Khalifa City A and B, Al Raha Gardens and Mohammad Bin Zayed City all currently suffer from a lack of quality amenities with very limited retail and leisure choices within less than a 20-minute drive."
Rami Nasser, Aldar's director of sales and commercial leasing, says the Grand Prix "will clearly add to the attraction and support demand for Yas Island and Al Raha Beach. "Major infrastructure elements have been delivered within a short timeframe to support such an event and will benefit future residents of the area. For example, the new ten-lane Shahama-Saadiyat Highway will greatly improve connections from the Yas Island area to the heart of Abu Dhabi and the installation of significant auxiliary infrastructure - power, water, lighting and so on - to cater for future requirements."
Richard Foulds, director - Abu Dhabi, CBRE Middle East, says, "Without a doubt, the impact of both Yas Island and Al Raha Beach on the residential communities of Khalifa A, B and surrounding areas is a positive one. The Al Raha Beach development will provide a further catalyst for greater numbers of occupiers to consider a move from the main island. We would expect to see communities on the mainland grow and strengthen and Raha Beach become a leading destination for leisure, retail, commercial and other use classes."
Abu Dhabi's new jewel
Everyone living on the mainland is eager for Aldar to finish both Yas Island and Al Raha Beach projects. "Once the new junctions and bridges over the E10 highway are opened, Yas Island and Al Raha Beach will become easily accessible and upon completion there is no doubt that the various leisure attractions on offer within these developments will have a significant positive impact on the off-island communities," says Paul. "As the phases of these developments will be completed over the next three to five years and as other major off-island projects, including the Capital District and Masdar City emerge, the whole area is set to be transformed in accordance with the visions of the Plan Abu Dhabi 2030. We envisage that eventually off-island living will no longer be a location of necessity - to avoid expensive rents - but a location of choice."
The Yas Marina Circuit could also make Abu Dhabi a household name internationally. "Completion of the F1 track brings so much more to Abu Dhabi than just a surge in the number of visitors for four days," says Scott Aitken, real estate specialist with Clyde and Co. "It provides an opportunity to showcase this city and its wonderful environs to many cross-sections of the international community. The massive indirect benefits include the economic multiplier effects of cash being injected directly into all sectors of the economy and a very high profile example of the Arab ‘can do' mentality. Those factors will create a lot of public confidence in the future success of Abu Dhabi and help underpin further demand for all the capital has to offer."
Motor-head paradise
It's no wonder then that Stew, who has such close ties to motorsports, would leap at the chance to live close to the track. In an interview with in December, Stew explained why he was so eager to live near Yas Island. "I got involved with Mark Webber through his supporters group and then got to know him personally. My involvement has since extended into the marketing side of things - I'm hoping to get him some local sponsorship. Hopefully by the time the race comes to Abu Dhabi, I'll be able to spend even more time on pit row, and my home will be just a boat ride across to the race track."
All had been going according to plan - the contract he signed in November 2007 indicated that the tentative date on which he'd be handed over his Al Bandar flat would be October 2009, giving him plenty of time to settle in before the race on November 1. In April, Aldar sent Stew a reminder that September 30 was the payment deadline for the "last instalment on delivery", which was still scheduled for October.
Upon receiving that deadline, he phoned to confirm the delivery date. "I found out indirectly from the sales team that there would be a delay, so I was expecting to move in around the end of the year. When I was considering the other local projects available at the time, one of the main factors for me was the date of completion in relation to the date of the race, and the sales team at Aldar assured me when I made my purchase that the Al Raha Beach property would be ready in time for the Grand Prix… I was sort of anticipating a delay, but I thought at the worst the flat would be finished by December or January."
Investor's disappointment
Stew was devastated to learn in July that his unit's completion date had been pushed back to May 2010. "It's not just a matter of inconvenience or disappointment relating to the race - I renegotiated my existing tenancy, which is critical in this town, based on the dates Aldar had given me," he says. "It was going to work perfectly because my current lease finishes in January, but now I'm faced with having to sign another year's lease or pay for short-term accommodation until my flat is finished." He acknowledges the contract designated October 2009 as a tentative closing date, meaning Aldar is in no way liable for the delay. While disappointed he won't be able to live near the track for the race, he takes issue with Aldar's lack of communication. "I've been very proactive in following up on the progress of the development through the salesman from whom I originally purchased the project, but this uninformed gentleman, through no fault of his own, has insisted all along that the property would be finished on schedule." For Stew, the Aldar management's failure to communicate with their staff for 21 months that there would be a seven-month delay in delivery is "inexcusable".
Delays like those at Al Raha will "add further pressure on to the market as demand remains," says Richard. "The wider concern is the overall effect this has on external investors' perceptions about Abu Dhabi. It would be tragic for the emirate to be labelled with a negative outsider view that product cannot be delivered on time or on budget and investors are suffering the consequences. If this is the case, investors will look elsewhere to invest and to minimise their risk."
Race to complete the track
In terms of the big picture, the completion of the track was a priority for Aldar. "The opening of the Yas Marina Circuit and the hosting of the F1 race will be an important day in history for Abu Dhabi and the UAE," says Duane Keighran, deputy head of real estate, Mena region, Simmons & Simmons.
Considering how much the F1 circuit stands to bring to the capital, it's no wonder Aldar appears to have put all its resources into finishing it on time. From his office across the highway, Stew has watched labourers work around the clock for months but has seen no progress on his building. "They must have taken all the resources from their other projects and put them to work on the track to make sure it was done on time," he says.
Project delays can deter foreign investors, says Paul. "Given this is Aldar's flagship development, any lengthy delays in handing over keys to investors in accordance with the sale contract will not only impact on Aldar's reputation but could also generate negative publicity."
Since learning that the handover had been delayed, Stew has taken some small comfort in a change of attitude from Aldar's management towards his situation. "In August, I had an extensive, ultimately amiable phone call from one of the Aldar directors who rang with apologies, explanations, excuses and assurances that Aldar was addressing the issues at hand."
Those apologies, however, won't help Stew much come November 1.
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