Firm begins reshaping Dubai's landscape

Dubai: Dubai Real Estate Corporation (DREC), an entity established last July to manage a massive Dubai government land bank, on Saturday announced the establishment of Wasl - its asset management arm - to oversee a rapidly expanding asset portfolio.

This is the first of many service entities that the corporation plans to roll out, including an investment arm to pump in heavily into property and expand its current portfolio of 17,000 housing units currently under management.

Ahmad Bin Byat, chairman, DREC, said: "As an organisation that manages a sizeable land bank for Dubai, DREC and its new subsidiary, Wasl, will contribute to the city's strategic goals for the sector and beyond.

"What makes this launch even more noteworthy is that Wasl will take the key experiences from Dubai's real estate sector growth to new levels of innovation and excellence."

The corporation, which inherited the assets belonging to Dubai Development Board and Dubai Real Estate Department, has roughly 70 per cent of Dubai's land bank under its belt, its chief executive told Gulf News in a recent interview.

"The government has major plans to reshape the real estate landscape of Dubai," Hesham Al Qasim, DREC chief executive, said.

"The establishment of DREC was one step towards this direction and the launch of Wasl is a natural progression in that direction." He however, refrained from disclosing the corporation's game plan further.

Dubai's late ruler Shaikh Rashid Bin Saeed Al Maktoum had in the 1970s invested heavily in establishing settlements in Deira, Karama, Satwa, Qusais, popularly known as 'Shaikh Colonies' that had helped in providing shelter to professionals and government staff.

Many of these housing allotments were handled by the Ruler's Court. DREC is expected to inherit and manage them as well - in what could be a major restructuring in government assets in the coming years.

It is, however, unclear if the government plans to corporatise its land bank and assets, which could raise the rents of a two-bedroom flat from as low as Dh16,000 to a much higher level while still keeping it below the market price.

The entity could soon outshine some of the major developers in Dubai and become the leading player, as it will gradually reshape some of the emirate's localities and neighbourhoods including Rashidiya, Al Qusais, and even Al Quoz Industrial Area and Jebel Ali Village.

Major hotel properties, such as Hyatt Regency, Grand Hyatt and Dusit Dubai have been brought under its portfolio from other government-owned entities in a major restructuring plan that will reshape Dubai's real estate landscape.

Al Qasim said it will gradually roll out hospitality, commercial and retail project development arms.

His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, issued a decree establishing DREC last July.

The corporation shall be a public commercial institution, affiliated to the Dubai Executive Council.

The new body shall own and manage all properties registered under the name of Dubai Government, including building, investing and utilising of commercial and industrial lands and properties situated in the emirate.

Dubai's strong economic growth and fast-growing population has put tremendous pressure on its infrastructure and pushed housing prices and rents in recent years.

Rising rent and rent-related inflation has prompted the government to impose a rent cap to help the emirate's middle income group, amid calls for solid investment in low-cost or affordable housing that will help Dubai to tame the housing inflation.

DREC is expected to undertake massive housing schemes to support Dubai's strong economic growth by providing affordable homes to the emirates growing population - a large chunk of which live in neighbouring emirates, especially Sharjah.

Land bank

Dubai's land bank are currently being shared among six major corporations including Dubai World entities - Nakheel and Limitless, Dubai Holding entities - Dubai Properties Group and Sama Dubai, as well as Emaar Properties, Dubai Investments and Union Properties apart from the direct government departments, while the majority of land used to be managed by departments that have now been brought under the jurisdiction of DREC.

Among these, Dubai World, Dubai Holding entities and Emaar Properties offer freehold lands and properties while Dubai Investments and Union Properties own lands that are offered to investors on leasehold (90 to 99 years).

DREC is mandated to develop and manage rental units. It is unclear if DREC will enter the freehold game in future.

"Right now, we are busy in the restructuring and putting the systems together. Then our plan is to increase the portfolio of rental units to meet the demand," Al Qasim said.

"Whether we enter freehold development is up to the government to decide."

Wasl will be focusing on project management, property management, hospitality and investment.

"The project management capability will cover residential, commercial, retail, light-industrial, public utilities, educational institutions, leisure and entertainment sectors," a statement said.

Who's who: DREC Board

Wasl: what's in a name?

The newly-formed entity's vision is 'to value and be valued' by its stakeholders and holds the core values of people, integrity, diligence, innovation and transparency. 'Wasl' will function as a customer-centric, knowledge-oriented corporation, founded on a commitment to its employees, shareholders and the community.

"The name, 'Wasl' represents our connection with the past, our current stature and our vision for the future," Hesham Al Qasim, DREC chief executive, said.

"Wasl, which stands for connection in Arabic and given its history in Dubai, also energises our mission of creating a legacy by acting responsibly and encouraging initiative, developing transferable knowledge and expertise and building trust and respect.