Dubai: Dubai has issued its first ‘partial ‘title deeds to investors in a serviced hotel apartment project. If all goes according to plan, the scheme, which could spike interest in such units, will be rolled out to other eligible schemes in the city.
“The first project was strictly a trial run,” said Majid Saqer Al Merri, CEO for Real Estate Registration and Services at Dubai Land Department. “We wanted to gauge the buyer interest in partial title deeds and then widen its scope.” The official, however, declined to name the project where it was trialled or the number of units and investors involved.
It was this year that Dubai Government announced a new category of partial deeds, by which multiple investors could acquire a unit and have this recognised as such. The intention was to smoothen the process later on if one of the partial deed holder wanted to make an exit. At the time, he could sell his share and without being dependent on gaining the approval of the main title deed holder.
Only for one category
Al Merri said the partial deeds will only apply to hotel serviced apartments, at least for now. “It’s a category that lends itself to having multiple investors in a single unit or units,” the CEO added.
Hotel apartments have proved hugely successful with Saudi investors in particular. There are currently a handful of such mega projects across the city, with the Palm being one such favoured destination.
“Partial ownership and recognised through deeds could give a boost to the hotel apartment category,” said an industry source. “This is a category that’s always been dominated by Gulf investors, and this gives them another reason to check out some of the latest projects.”
There is a belief among local developers that hotel apartments will again come back into prominence next year, when some of the ongoing projects are delivered and investors see potential ahead — and through — the Expo 2020 Dubai run.
Only for new projects?
The market is awaiting further guidelines from the Land Department on whether partials will be issued only on new projects, where the sale of a property is yet to be registered. Sources add that would be the easiest way for the government agency to proceed, rather than try to do anything retroactively.
One of four initiatives
It was in July that the Dubai Land Department issued ‘Real Estate investment Opportunities’ to tap new — or renewed — interest in local property. The partial title deed was one of them. The others were a lease-to-own scheme and “collective” real estate investment funds.