The World Heritage Site award from the United Nations Educational, Scientific and Cultural Organisation (Unesco) is widely looked upon as a boon to any city, alongside a boom in tourism, and a subsequent boost in property purchases and prices. But the announcement that Dubai Creek is on the tentative list — and may be accorded the title in June 2014 — does not particularly enthuse those working in real estate. Realtors say the fact that Unesco officials were in Dubai recently to finalise their decision has had little or no impact on creek-side freehold developments. However, they do point out several other factors that will affect the buying and selling of property at communities located alongside Dubai Creek.
New interest
Mujtaba Virani, Senior Consultant, Better Homes, says not many residents are aware of the ongoing efforts to gain World Heritage Site status for Dubai Creek. “Future plans that are a long way off are not at the forefront of the current trend we see in eager buying and selling. Buyers are more affected by immediate developments, such as the new extension of the Creek into the Arabian Gulf.”
Virani believes the projectis a significant indicator for gauging current trends in the Business Bay area. “Developers are keen to get into the act and are eyeing plots that will overlook the new Creek extension. Investors will naturally be interested in homes that have great views. Just now, the quality of infrastructure at Business Bay leaves a lot to be desired, and some people have not received what was promised. But new developments — with superior infrastructure — will revive interest and place it high on the popularity charts.”
Fortuitously, Virani’s observations were made to GN Focus before the official ceremony a few days ago, marking the launch of the Dubai Canal project. Work is set to begin later this month, after His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, launched construction at Safa Park. Highlights of the project include pedestrian and shopping bridges, hotels, marine and docking stations, beaches and several new properties.
Ahad Khan, Property Consultant at St Clair Real Estate has a different take for now: “Business Bay has a great location, and prices are cheaper here than at neighbouring Downtown Dubai, although most residents get the same views. For instance, the average price per square foot at Downtown Dubai is about Dh2,200, whereas at Business Bay it is only Dh1,400. This makes it a great bet, irrespective of future plans for the Creek.”
He says the property market in Dubai is currently stable but asserts, “This fact is not related to Expo 2020 or the Unesco announcements. It is new freehold launches — especially by big developers — that are buoying the market and maintaining this slower but steadier growth [when compared to the last cycle].”
Praveen Mehta, Business Development Manager at Coldwell Banker, candidly admits, “Like myself, I think most residents of the UAE don’t even know that Dubai Creek is seeking a place on the Unesco list. If buyers are not aware of something, it is unlikely to affect their decisions.
“In stark contrast, the expected announcement of Expo 2020 is already propelling property purchases. If Dubai wins the bid, we expect an escalation in buying property and in the prices of properties, irrespective of location. People are influenced by what they see, read and hear, and awareness is much higher for Expo 2020.”
Mehta adds that the doubling of transfer fees, from 2 per cent to 4 per cent will also have an impact. “Although it is a great initiative from Dubai Land Department to prevent prices from shooting up unreasonably and creating another bubble, it is going to impact the market for a while — until investors and agents absorb the trend fully.”
True picture
Real estate agents who have their pulse on the property market often prefer to be quoted anonymously when speaking their mind. One veteran who used to specialise in Culture Village, a project launched in 2006 and scheduled for completion in 2009, says it is in shambles. “The creek-side location and the proposed World Heritage Site status are fine in theory, but the reality is that the place is a construction site, and appears largely abandoned. There are now only two buildings there, Palazzo Versace and D1 Tower, and the only calls we get are from owners who bought off-plan, wanting to know if there has been any increase in price.” He adds: “I think this project may soon be rebranded and developed under another name.” No such announcement has been made and the developers have given no indication that this is the case.
Incidentally, a 3,961-squarefoot three-bedroom apartment Palazzo Versace is currently listed at Dh16.26 million, with an eightbedroom full-floor penthouse priced around Dh24 million.
Another consultant says Business Bay is the only freehold project designed around Dubai Creek that has seen light of day. “At Culture Village, people want to know what happened to Yuvi Residence, The Estate Tower, Iris Amber, and MODO. At the former trouble-ridden Dubai Lagoons, speculation is rife that it is being redeveloped as the new Dubai Creek Harbour project, and if Emaar Properties is on board, it is safe to expect a sellout success. There are real issues with projects that were planned around Dubai Creek, which need to be addressed for its success, irrespective of whether it becomes a Unesco-awarded area or not.”
However, with construction having begun on the Dubai Canal, optimism abounds again.
