Dubai: It pays to have a canal run through your development and over turn into waterfront properties. Dubai’s developers with projects or plots located strategically across the stretch of “Dubai Canal” are certainly looking to ride the value gains from the newly announced water body.
By taking up much of the canal when it finally starts taking shape, Business Bay becomes an obvious beneficiary. The master-development had been building up steam in terms of tapping investor interest; but there was a two-tier structure in terms of the demand patterns. The Executive Towers were doing quite well and obviously benefiting from fronting on to Shaikh Zayed Road. But some of the recently completed projects are stilling to get some traction going with prospective investors.
The Dubai Canal — expected to cost a substantial Dh2 billion — could be just what the doctors ordered. “Waterfront areas are a value addition and important indicator to the beauty of any city in the world — the canal will add six kilometres to Dubai’s waterfront which gives an additional edge to be one of the world’s best cities backed with uniquely constructed bridges, shopping and entertainment centres, luxurious marinas and world-class hotels,” said Mahdi Amjad, executive chairman and CEO at Omniyat Properties.
“In terms of hospitality [investment] play, there is huge demand in the marketplace; Dubai is phenomenal in tourism and it is a major motivator for large investors. Look at what Dubai has done in tourism — growing from 1 million to 10 million tourists now, which gives you belief in the Vision 2020.”
The canal project as such is a revival of the creek extension plans Dubai has had for some years now and even featured in the original masterplan for Business Bay. Even earlier, Dubai has used the water element to create a premium feel for its developments, with Dubai and the Palm being the early beneficiaries as did JBR. The new project will leave a wider imprint.
“The new canal will have a similar role to play not only to the areas it covers — including Business Bay, Shaikh Zayed Road, Al Wasl and Jumeirah — but also to the wider emirate and give a shot in the arm to a variety of sectors including tourism, transportation, retail and shopping,” said Amjad.
Time will tell whether developers will rush to market with projects on this stretch. At Cityscape next week, Meydan will be announcing plans for a new decidedly upscale tower on Shaikh Zayed Road. Others could do the same.
“The Canal project is such an innovative one as it crosses Shaikh Zayed Road and passes across the Safa Park, Al Wasl Road, and Jumeirah to touch the Arabian Gulf,” said Tanzeel Gader, CEO of Flash Properties. As much as it is important to Jumeirah, Al Wasl and Sheikh Zayed Road, this project increases the value of the Business Bay area significantly.”
Dubai stands a chance of pulling in some sizable investment flows into real estate if it plays its cards right, according to market sources. CBRE, the property consultancy, estimates Asian institutional investors have more than $150 billion that could go into realty in the next five years alone.
“Dubai’s strategic location and its rapidly developing real estate market is gaining strong investor appetite from Asia, specifically from China, Malaysia and South Korea,” said Nick Maclean, managing director, CBRE Middle East.
During the past 12 months we have witnessed a significant increase in enquiry levels particularly focused on Dubai income producing assets, driven by an expectation of further growth in rental and capital values.”