Dubai property: Auction of semi-built tower in JLT sees bids go up by Dh100m in 4 hours
Semi-built residential tower garners heavy bidding in just 4 hours
Dubai: Investor activity in Dubai’s property market continues to run high, with an auction on a semi-constructed residential tower in the popular JLT cluster rising by nearly Dh100 million on the base price – and all that in a matter of hours.
That meant from the base price of Dh100 million, it had rocketed to Dh210 million. All in just a few hours as more than 100 investors threw themselves into the action.
The heavy-duty bidding last evening was happening just before the close of the auction on the project, which is the ‘Al Saqran’ building, which currently is at just over 30 per cent complete. It was to be a ground plus 34-storey structure and also including six basement levels.
The project came up for auction about two weeks ago and the base price set at Dh110 million. What’s even more interesting is that there was not even a single bid was placed until yesterday, which was the closing date for the auction on it.
And then every possible bidder sprung into action – at one time, more than 130 had placed themselves with a chance of acquiring the project and its site. It’s not known whether the eventual winner has been identified.
“The original minimum bid price of Dh110 million would have caught every investor or developer’s eye,” said an industry source. “There is significant demand to buy off distressed projects in the market, because for the new investors, it means getting into a project at a relative discount.
“A greenfield site in locations such as JLT or Dubai Marina at current rates would have been much higher.”
Demand has also been fed by the number of new companies setting up at DMCC and their employees seeking out apartments in JLT.
JLT hits the high notes
In the recent past, the Jumeirah Lake Towers’ cluster had seen multiple high-profile launches, from Sobha, Ellington and Danube. Property values in the cluster had risen well over 20 per cent during the period, depending on the project and location. Another boost has been the growing interest for office and commercial space in the wider DMCC free zone itself.
Another outsized boost for the area – located off Sheikh Zayed Road – is the ongoing fast-track development of another upscale mixed-use hub, called ‘Uptown Dubai’. The first project – fittingly called ‘Uptown Tower’ and rising to 340 metres (and 81 storeys) – was fully leased well before its completion date.
“Demand for JLT space is getting the full blast from DMCC and Uptown Dubai,” said the source. “This is why the Al Saqran auction proved such a draw with investors. Even if the winning bid is Dh210 million, it’s still a good price to enter for the investor.”
There is speculation that some major names were involved in the bidding. Recently, the Select Group – known for its roster of premium tower projects – picked up ‘The Pentominium’ skyscraper site in Dubai Marina, also through an auction.
The selling price? $100 million.