Dubai: Dubai’s developers have hit the top gear in the number of off-plan launches they have had in the second quarter, with some weeks recording more than one. In fact, some estimates reckon that this April and May have been the busiest two-month period for launches since the property market picked up in mid-2011.
If one were to include the launches in March as well, it would definitely be the strongest in launch terms, if one were to exclude those made during the Cityscape Global events. The numbers have stacked up because of the ‘affordable-tagged’ launches from Nshama — with its Town Square development — and the latest one from MAG Properties in Dubai World Central.
The pipeline of high-end property launches has been just as active, with private developers such as Cayan, Palma (featuring Emirates Towers designer Hazel Wong as the architect) and RP Global making a strong play for the luxury space.
The launch rush could be prompted by the imminent start of Ramadan (due by the second fortnight of June) and then followed by the Eid break as well as that for summer.
But are there enough buyers to pick up all the new rooms and villas coming out of developers’ drawing boards? The affordable ones are generating maximum interest — no surprises there as developers offer incentives such as longer drawn out payment plans — but some of the luxury offerings too are finding takers with ready money on hand.
“Off-plan launches by government-related entities as well as private developers have systematically been at prices lower than the ones prevailing in the secondary markets, by as much as 20 per cent,” said Sameer Lakhani, Managing Director at Global Capital Partners. “This has elicited a strong response in the primary market, even as prices have softened in the secondary markets, albeit at a gradual level.”
Even as local developers cast their net wide, they could be facing a run for their money from projects in London and even Continental Europe. It is no coincidence that there were several UK developers took the trip to Dubai to present credentials of their projects.
They have every reason to do so, according to new findings by Knight Frank. In fact, three-fifths (58 per cent) of regional investors have a marked preference for the UK, according to the firm’s ‘Middle East Capital Tracker’. Another 19 per cent could pick up property assets in the Gulf territories, while 12 per cent might plump for Continental Europe. US options find favour with only 5 per cent, though interest is getting stronger.
“The stronger greenback now means that property abroad is broadly cheaper for most GCC-based investors,” said Khawar Khan, Research Manager at its Dubai office. “All else being equal, property markets of the UK and Europe stand to benefit strongly in the short-term.
“In fact, evidence of this has already materialised; Qatar Investment Authority acquired 8 Canada Square in London for $1.7 billion at the end of last year — a record-setting real estate deal in the UK.”
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