Dubai: Dubai’s mid-market residential needs have received a substantial boost with a new joint venture between Dubai South and Emaar, which will create as many as 15,000 homes in the fast-emerging location of the city, close to the world’s largest airport. The master plan for Emaar South — set on nearly 7 square kilometres — is being finalised by an international architectural firm and will have as its centrepiece an 18-hole golf course set on 80 hectares.
Details of the overall project cost and the time frame for its completion have not been revealed.
The first phase could take up four years to see through.
But the location is what creates possibilities for Dubai’s unmet demand for more affordable homes than what the marketplace has seen to date. Mohammad Alabbar, Chairman of Emaar, said the challenge would be to push through prices at a “reasonable level and at margins our shareholders will be happy with. And we are not going to set a time frame on such a sizeable development and when the city itself is extending its boundaries.”
There have been a few launches already at Dubai South by private developers, but nowhere on the scale that Emaar South will attempt.
Emaar’s tie-up with the master developer will also work as a huge plus in phasing the project through the years. (Incidentally, this is the second major joint venture that Emaar has got with another master-developer in recent times. It has an alliance with Dubai Properties to create Dubai Creek Harbour.)
The prices of the homes at Emaar South have not been revealed. But, according to market sources, if a good number are priced in the range of Dh700-Dh800 a square foot, it can be a major incentive for prospective buyers to home in on a Dubai South based investment/end-use.
And Emaar’s track-record will take care of the rest, the sources add.
There are to be multiple residential options, split between apartment blocks, town houses and villas.
In time, the sources add, Emaar South will create the benchmark for pricing in other launches the location will attract. And in keeping with the mid-market nature of the project, the plan provides for three- and four-star hotels and community retail.
A lot of synergy will also be sought with the Al Maktoum International Airport and the other clusters the development will create, such as the Aviation and Logistics districts. According to Khalifa Al Zafein, Executive Chairman of Dubai Aviation City Corp. and Dubai South, “We would like all employment generated by Dubai South to live within it.”
On how Emaar plans to finance the project, Alabbar said: “We don’t have any precise numbers on what the costs would be ... it would be met by a little bit of equity, debt and off-plan. But we don’t want to get into a situation where it (debt) goes back to being 1:1. As a company we are extremely conservative on debt levels ... if fact, (we are) allergic to debts. You look back and there’s 2009., but the (low) interest rate is sweet.”
The chairman added that the company’s numbers are looking good irrespective of the state of the broader market. “The cash position is looking good, we are 50 per cent above budget and 30 per cent above last year (on revenues).”
