In Dubai, road networks too decide property price dynamic

In Dubai, the real harbinger of things to come was neither the World Trade Center landmark in the 1970s, nor even the iconic Emirates Towers and Burj Al Arab prior to the freehold boom. It is the asphalt passages that crisscrossed the city - and continue their growth to this day.

Arterial road networks became interwoven with the extensive web of the city such that each part of the arterial and metropolitan tapestry are bound in a seamless framework. Even though the highway was a product of New York (the word was first officially used in Kings County in 1654), it has been in Dubai that the elements of modern highway design have merged with parkways, bridges and tunnels in a manner that is pathbreaking and far beyond what the original progenitors had in mind.

The wider these corridors became, the greater the potential for density, as it attracted a slew of architects and developers that enabled city centres to flourish and allowing for an escalation of prices in dense areas. The result was that density itself attracted greater density and, therefore, gentrification. While construction came in bursts - and changed along the way as sensibilities of landscaping changed - the overall roadmap has stayed in place. Of course highway building is an enterprise is never one with intrinsic closure.

Defined by its road network

Roads can go on forever, and they generate a momentum of their own. Build one and suddenly, even inevitably, others seem vitally needed. In areas like Dubai Marina, with the arterial network being narrow, traffic congestion has meant there was the need to build public transportation like the Dubai Tram to increase mobility. But generally, the network of asphalt dictated the price trajectory over time.

This has been in contrast to areas like JLT and JVC, where highways merged with circular parkways thereby easing congestion and allowing for greater landscaping areas. The highest values were soon being commanded areas that had easier access to Sheikh Zayed Road, and mixed-use communities that had easier entry/exit access points were the ones higher in demand. This trend has only accelerated in a post-Covid world, even as demand for villas increased (which itself necessitates greater distance from the hustle and bustle, but equally a need to connect to the city centers in a seamless manner).

Isolating residential neighborhoods from heavy density traffic was a variable that waxed and waned and is evident in the city planning that transpired. In a rapidly urbanizing city like Dubai (where the road networks have been upgraded constantly), horizontal compound living has also been inevitably wrapped into the main arterial networks (in Barsha and Jumeirah). And in many cases, subsequently rezoned to allow for greater vertical structures to be constructed.

Highways matter

In the process, project management itself changed, with quiet residential communities having multi-storey shopping centers at the very edge to allow for commerce to comingle with the quieter aspects of the cityscape. Thus allowing for efficient utilization of land - but one where the arterial network became even more critical.

The results are clear enough to see in the post-Covid world. Even as demand for horizontal living has increased and widely commented on (the oversupply narrative having largely disappeared), look under the numbers and some startling figures emerge. The greatest preponderance of price increases have been in areas closest to highways and in proximity to ease of access.

Thus, prices of median suburban villas have risen by less than the median downtown apartment values (11 per cent vs 19 per cent). Undoubtedly, there are other factors at play here, but ignored in the literature of real estate analysis has been the importance of road network access. A factor that is something to be marveled at.

Migration of schools

Of course, committed urbanization needs to be broader than just the road network. The need for schools to be integrated into residential areas and away from the main arterial networks is now underway, thereby freeing up land as well as easing congestion (something that we have witnessed rearing its head recently with a vengeance).

The Urban Plan of 2040 goes further towards this concept of rezoning, moving away from the existing “superblock” paradigm and facilitating a more tranquil proposition where inner arteries would be given greater emphasis. The Linear City Model is now giving way to a more complex network with high-rises being interrupted at key points with lateral nodular configurations. This paves the way for the path dependence of prices, as these arteries come to fruition.

But the grand web of asphalt (euphemistically referred to as ‘roadtown’) will continue to exert its influence in the price discovery of real estate.