Which Dubai locations are set to boom as Al Maktoum International Airport project takes flight?
Dubai South, Expo City immediate beneficiaries from Dh128b project - there are others too
Dubai: Locations ‘within a 20 kilometer radius’ of Dubai’s new Dh128 billion mega-airport project will be the first to feel the demand and price lift-off from the city’s biggest infrastructure project in the making.
“The immediate beneficiaries will obviously be Dubai South and Expo City, but even locations slightly further away from Al Maktoum International Airport will feel the impact,” said Vijay Doshi, Managing Director of the developer Vincitore Realty. “Any land available in this radius is going to get snapped up – as soon as they become available for sale.
“As far as developers and property buyers are concerned, the new airport is creating a whole new dream destination in Dubai.”
It was late April that he designs for the ambitious Dh128 billion ($35 billion) airport project was announced, and with an anticipated capacity to see through 260 million passengers a year. That would make it the world’s biggest airport facility. It would cover a sizeable 70 square kilometers on its own.
The first phase of the airport will take 10 years to build and with a capacity for 150 million passengers a year.
Which leaves plenty of room for Dubai’s real estate action to home in on all the possibilities around the airport site. Already, offplan projects centered in Dubai South and Expo City are out to catch the investors’ eyes, with the Expo City now having Sky Residences with payment plans of up to 8 years (including 5 years of post-handover instalments). Prices start at Dh1.8 million.
Jebel Ali, Dubai Investments Park, and Dubai World Central will experience a surge in development. With improved connectivity and infrastructure, these areas will also have an uptick in land and property values, offering lucrative opportunities for investors and end-users alike
Targeting a new generation of investors
So, which will be the other set of locations that could benefit from the airport? Simon Townsend is CEO of Avison Young, a real estate advisory firm. “The activation of Palm Jebel Ali and surrounding areas, as well as lands adjacent to Dubai Parks will have enhanced connectivity through this new aviation hub,” said Townsend.
“Other locations (that could benefit) are the coastal developments of Al Jurf and Ghantout. There is no doubt that the corridor between the Expo site to the coast, and through to the border with Abu Dhabi will benefit from the new masterplan.”
‘Less than 60 minutes apart’
And there is also a bigger picture to work on. “The projected increase in passenger numbers with Dubai’s airport expansion should be considered in conjunction with the strong growth seen at the new Abu Dhabi airport terminal,” said Townsend.
“These two global aviation hubs are less than 60 minutes apart - this further strengthens the corridor between them creating a new ‘golden rectangle’ for projects that benefit from air connectivity.”
The UAE's two global aviation hubs will be less than 60 minutes apart and between them creates a new 'golden rectangle' for property development
Action time at Dubai South
Dubai South has through the last decade been building up its residential options, its commercial zones and office options. Now, the master-development can buckle up for the next stage of growth on the wings of the Al Maktoum International launch announcement.
“The current land values are between Dh160-Dh180 per square foot on built-up area,” said Eima Hajimalian, Manager at GCP Properties. “We can see that land prices have increased by 35 per cent in the last 12 months.”
Dubai South already has been on a well defined price upswing in the last 12 months
Look at it another way - that’s well before any announcement of the new airport and what Dubai intends to create with it.
How are property values and rents faring?
Through the last 12 months, the price and rental values have firmed up in double-digits, according to GCP Properties’ data, and especially for the apartments. Given the size of the Dubai South location itself, the rentals on offer a good deal of pricing options. That could mean Dh50,000 for an annual lease on a furnished studio, Dh70,000 for a 2-bedroom options, and hitting the scales at Dh100,000 for a 3-bedroom unit.
I believe the upward price action in areas around al Maktoum International can start as early as within the next two-three months
“The next 2-3 months will be the ones to watch out for – because that’s when the new airport announcement will start filtering down to the real estate activity,” said Doshi. “With available land, there are also opportunities to create mid-segment serviced apartments keeping in mind the jobs that will be created to build the airport project.
“It sure is the next chapter of growth for Dubai South…”