Dubai: A Sajwani getting active in Dubai’s property market and launching a company? You read that right – but it’s not Hussain of Damac who is making the news this time.
Instead, it’s the son Abbas, who is getting into the property act. His AHS Group has launched a new company that focusses on luxury property – but with a difference. The new business, AHS Properties, will buy older super-luxury villas in Dubai – those in the Dh50 million and plus range – then put them through an extensive fitout makeover, and then sell them.
In other words, be a fixer-upper, and there are some fairly outsized margins in the business. But the upfront costs are heavy too, because AHS will acquire the properties and then get started on them. Typically, these luxury homes will be of five- to 1—year vintage, but they could be older too.
AHS Properties currently has four such properties, three on the Palm (around Dh80 million apiece) and one at Emirates Hills (an eye-watering Dh135 million). “The full renovation works will take about a year and that’s when we sell them,” said Abbas Sajwani. “A year is not too long for these kind of properties – we brought in top designers in town to work on them. Three of them will be given an updated modern look, while the other will have a classic theme.
“There should be no difficulty in finding buyers – the market has been seeing some crazy transactions, with one rental deal in town signed for Dh7.5 million. These are never before kind of numbers.”
In the year-to-date, Dubai has recorded multiple Dh100 million plus transactions for homes, most of which have been on the Palm.
On his own
Abbas makes it clear that AHS Properties – and the Group – operate well outside of Damac. “Sure, I have had some help, but AHS is not part of the group,” he added. “In the past year, AHS has made investments in the local property market and those did pay off.
“We will reinvest some of the funds generated from future sales into the business to acquire more properties, plus some bank finance.”
No buying in bulk
Abbas will stick to maintaining four to six properties at any time for the makeover. “It will never be 20 or higher – each property has to be crafted to a certain standard and it will take time to get the concepts right,” he added.
Why can’t he think of entering deals with the property owners rather than buying in full? That way, can’t he better manage his outgoings?
“Doing so would be difficult because of the time involved in reworking it and the selling,” said Abbas. “Most clients would rather take the cash upfront – that suits us fine. They are looking to sell, not re-develop the property. Waiting for a year is not for them.”