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Properties adjacent Metro stations draw higher rentals

September 4, 2011 19:48 by elysian

The Dubai Metro station is gaining prominence and is more of a priority for tenants now, commanding 10 to 20 percent more rentals, said the latest report by Asteco, leading real estate services Company in UAE.

With growing numbers of offices and apartment buildings in Dubai, the rates for property leasing are based on a new market dynamics, the report points out. 

According to Asteco CEO, Elaine Jones, the rental disparity is more pronounced now, than ever before, with Dubai Metro adding new dynamics to the market.

There have already been sufficient evidences from international markets about a constant growth in values for markets located adjacent to stations with metro lines. For instance, HotProperty.co.uk reported that homes in Central London, locate within five minutes of walking distance of a tube station, are nearly 21percent more expensive than those of similar properties further away. However, the prices do not grow until the stations are officially operational. 

In Dubai, leasing prices for a double bedroom apartment locates within walking distance from Mall of Emirates Metro Station is between Dh.60,000 to Dh.65,000 per annum, in comparison to the value of Dh.50,000 to Dh.55,000 for properties situated a few kilometres away from the station. 

Similar trend is seen in the case of more upmarket properties with double bedroom apartments near Emirates Towers Metro Stations and DIFC costing anywhere between Dh.110,000 to Dh.130,000 per annum, while properties further away costs Dh.90,000 to Dh.100,000 a year. 

A property in Deira will now draw an annual rental of Dh.50,000, while similar property away can be leased for Dh.40,000. This indicates market maturity, Jones said.

The Dubai Metro Green Line will be unveiled on 9th September, and it will have an additional 18 stations, stretching 23kilometers, covering some of the busiest tourist segments along the creek, including business districts, residential areas and ministry offices. 

In general, real estate prices are not solely dependent on its geographical location anymore. All properties in Deira or Bur Dubai with immediate access to a metro station can attract similar rates as that of a property in Jumeirah Lake Tower or Business Bay without a metro access, the report pointed out.

by Exclusive Dubai 


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Categories: Company News | Elysian UAE | General | Investment News | Property Management News

Chicago firm's design towers over the rest

August 2, 2011 19:48 by elysian

Plan by architects Smith, Gill chosen for kilometer-high Saudi skyscraper

  

The competition to design a new skyscraper in Saudi Arabia had a simple but lofty rule: The tower had to be the world's first kilometer-tall building.

The design submitted by Chicago architects Adrian Smith and Gordon Gill — a sleek glass tower built atop three legs and tapering into a skyscraping needle — was announced as the winner Tuesday, further cementing Chicago's role as a hub of cutting-edge architecture.

Construction of the $1.2 billion building, called Kingdom Tower, is expected to begin around December in the waterfront city of Jeddahand be completed a little more than five years later, Smith said. The tower's exact height hasn't been revealed, but it will be the first building to be at least a kilometer, or 3,280 feet, tall, according to Adrian Smith + Gordon Gill Architecture.

If completed, the tower will be at least 563 feet taller than the world's current tallest building, the 2,717-footBurj Khalifa in Dubai, United Arab Emirates, and nearly double the height of Chicago's Willis Tower, including its antennas.

Smith was the lead designer of Burj Khalifa and Chicago's Trump International Hotel & Tower while he was with the Chicago office of Skidmore, Owings & Merrill. Burj Khalifa opened in January 2010.

The expectations surrounding record-setting buildings are often hard to meet. Burj Khalifa had relatively high vacancy rates when it opened just after Dubai's real estate bust, and others have not been built despite high-profile plans. That's true of the 2,000-foot Chicago Spire. Ireland's Garrett Kelleher promised to build it at 400 N. Lake Shore Drive, but the plan collapsed, leaving a hole at the site and millions in lawsuits from his creditors.

But judging buildings such as Burj Khalifa and Kingdom Tower on their first few years of operation is unfair because doing so fails to account for their long-term effect on the value of surrounding properties and their performance over time, said Antony Wood, executive director of the Chicago-based Council on Tall Buildings and Urban Habitat.

"It's expensive to build a supertall building," Wood said. "If you look at the history of the world's tallest, it's never been about just making the largest financial return. It's about other things. It's about ego, attention, status and all those things."

Kingdom Tower will house a luxury hotel, apartments, condos, office space and the world's highest observatory. It is part of Kingdom City, a development in Jeddah expected to cost $20 billion, according to the architecture firm.

Smith and Gill's firm beat at least five others, including Skidmore, that submitted plans for the tower. Smith and Gill said the building's backers wanted the structure to be a symbol of Saudi Arabia's future, so they designed it to resemble a plant shooting skyward.

"We looked to a powerful symbol of life springing from the ground and forming itself as a vertical spire toward the heavens," Gill said. "We used symbols such as new plant growth coming out of the sand and spoke to that as a kind of rejuvenation of intellectual capital, business and culture. I think that those are some of the things that we hope this building will come to represent."

The building's tapered, sloping shape is designed in part to counteract wind forces, building on lessons learned from the construction of some of the world's other tallest skyscrapers, Smith said.

"The design of a supertall building is very new territory in the science of structural engineering and architecture," he said. "You only get one or two of these per decade, so each time we do a supertall building, the learning curve on how to do the next one is improved by about 10 percent of man's knowledge."

The winning design was announced by Saudi billionaire Prince Alwaleed bin Talal, a nephew of Saudi King Abdullah.

The contractor will be Saudi Binladin Group, the multinational engineering firm started in 1931 by the father of Osama bin Laden. Company officials have said the terrorist mastermind, who was killed by U.S. forces in May, was forced out as a shareholder in 1993. 

 

 

Reference: http://www.chicagotribune.com 


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Categories: Developer News | Elysian UAE | Financial Services | General | Overseas News

Dubai's Olympic wait will be worth it, officials say

July 31, 2011 19:35 by elysian

Dubai decided against bidding for the 2020 Olympics to give itself time to prepare for an even better Games in 2024, a National Olympic Committee (NOC) official says.

Saeed Abdul Ghaffar, the secretary general of the NOC, yesterday said the pressure on Dubai to get it right was particularly great because no Arab country had hosted the Games.

"Dubai will represent the Arab world at the Olympics," Mr Ghaffar said. "If we are successful for Dubai to host the event, it will be a historical event. It will be the first time for the Middle East."

While logistics were in place for an Olympics in 2020, Dubai would be "even more ready" by 2024, he said.

Organisers would also have a chance to study the 2020 Games, the location for which will be decided in Buenos Aires in September 2013.

"We want to do it professionally and not just host the event," Mr Ghaffar said.

"It is not strange for Dubai to host a big event- it has hosted many big events - but when it comes to the Olympics, there is a need to make big preparations."

He said it would also be helpful to have 13 years in which to build up youth sports.

"All generations need to work for the UAE and for the UAE's name," Mr Ghaffar said.

"There is a need for a lot of encouragement to get people into sports in the next few years if Dubai is to host the Olympics. The announcement in itself should be a message to youth to work from now and to help the UAE."

He said sport needed to be held in higher regard by the Arab world.

"In Europe and America, they always work hard for sport and for their future," Mr Ghaffar said.

Sports club managers from across the country have expressed excitement over the recent announcement, agreeing a later bid would be better. But they said preparations needed to start as soon as possible.

Tarek Souei, the technical manager of Al Ain Sports and Cultural Club, said more investment in developing sportspeople was needed.

"[The UAE] should also compete in the Olympics," Mr Souei said. "Awareness needs to increase in private and public sectors to get people involved."

He said people would be needed to help in financing and running the event. Sports clubs could also play their part.

"Experts from different clubs can be used [and] infrastructure, human resources and equipment," Mr Souei said. "Everyone will be talking about the Emirates. It will help market the country."

 

 

Colin Ewing, the manager of the Sharjah Wanderers Sports Club, agreed.

"There needs to be effort from everybody. There needs to be a lot of co-ordination," Mr Ewing said.

Ahmed Al Kamali, the president of the UAE Athletics Association and a member of the NOC, said preparations would only begin if the bid was successful.

"When it is finalised, then we can decide what the preparations will be," Mr Al Kamali said, adding the federation would do whatever the Government required of it.

"Now the preparation time is much better."

Winning would be a "great honour for the UAE", Mr Ghaffar said.

"Dubai is part of the UAE. If Dubai hosts the event, so does the UAE," he said.

Mr Ghaffar said that Qatar's successful bid to host the Fifa World Cup in 2022 showed "nothing is impossible".

"A lot of countries have hosted the Olympics, so why not us?" he asked.

 

Reference: http://www.thenational.ae 

 

 


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Categories: Elysian UAE | General | Investment News | Overseas News | Press

Dubai real estate back on growth track

July 30, 2011 21:31 by elysian

Dubai: Dubai Real Estate Corporation (DREC) will look at acquiring assets for development and management within the emirate, as the property prices in certain areas are about to pick up, a top official said.

"We believe in the future, see good opportunities in the near to long-term and might look into assets for acquisition and development, if it makes economic sense," Hesham Abdullah Al Qasim, Vice-President and Chief Executive Officer of DREC, told Gulf News in an exclusive interview Monday.

 

Hesham Abdullah Al Qasim, Vice-President and CEO of Dubai Real Estate Corporation. He said the company has plans to develop a number of hotels for the budget segment. 

 

Dubai has a large pool of residential and commercial properties that are currently at very attractive prices by any standards. These properties, in the long-term, could help investors give a solid return on investment once the property market fully rebounds. Some developers, in the days following the global recession undersold properties to ensure cashflow as buyers were hard to come by.

When asked if DREC would directly enter the market with that objective, Al Qasim said, DREC will not acquire companies. "No, we are not interested in acquiring real estate companies whether they are domestic inland or structured for freehold sales — that is not our core business," he added, DREC will focus on rental and leasehold market. "We do not have any plans to enter the freehold market — that's not part of our mandate."

The company, which has a diverse portfolio of assets including residential, commercial, tourism and industrial properties, is planning to develop a number of hotels for the budget segment.

"We are also expanding the Le Meridien Hotel with 200 rooms currently under development," Al Qasim said.

Hospitality

"As a company, we are studying the hospitality market which is the first to recover from the financial meltdown and we see demand coming back, especially, in the mid-market and budget segments. There is a shortage of branded three-star hotels in the market."

DREC has a residential portfolio of 25,000 housing units currently being managed by its asset management arm, Wasl Properties, with an occupancy rate ranging 92-93 per cent. The company has delivered about 5,000 units during the last 3-4 years and has a few hundred units currently under development.

Al Qasim said, DREC has done well even in economic downturn. "While a lot of other developers and companies' operations shrunk, we grew our portfolio and our rental income also has gone up. This is a phenomenon and reaction seen and reported on globally to these kinds of circumstances in all urban business centres like ours.

"We are a solid company and ready to play a strong role in the economy of Dubai."

Dubai Government has amended the law that helped set up DREC in 2007, bringing it under the direct control of the Ruler's Court, giving it a wider mandate to expand its portfolio and achieve greater financial independence.

The company, which inherited a large pool of government housing assets when formed in 2007, is looking at rationalising rents across its portfolio. "We are following the rent index of the Real Estate Regulatory Agency (RERA).

The company has a solid cash flow coming from rents and lease contracts across its assets — part of which is re-invested in new projects.

Al Qasim said, in terms of portfolio size, DREC is the largest real estate company in the emirate. In addition to the residential portfolio, it owns a large pool of luxury hotels including the Hyatt Regency, Park Hyatt, Grand Hyatt, Le Meridien Dubai, Le Royal Meridien, Le Meridien Mina Seyahi, Westin Dubai hotel and Dubai Golf which runs Dubai Creek Golf Club and Emirates Golf Club. It also has 5,000 industrial plots under management.

He said, following the economic recession, Dubai is back on a growth mode.

"The economy is back on growth track and we see market picking up. We have witnessed a steady growth and we look forward to a better growth track going forward."


  Reference: Gulf News


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Healthy increase in occupier demand in Dubai office market, report shows

July 30, 2011 21:29 by elysian

The Dubai office market has shown healthy increase in occupier demand during the first three months of 2011, fuelled by a number of factors, namely the increased affordability of office rents, the choice and variety of stock on the market and the slow return of confidence in both the local and global economies, according to a new report.

Dubai is still viewed as an important and strategic location for businesses to have a presence, the report from real estate specialist Cluttons shows.
 
With the city becoming affordable, this is a good time for foreign companies to establish themselves within Dubai, in addition to long established firms looking to take advantage of newer, higher spec office space, and for corporates already long established there to take advantage of good deals for newer, higher specification office space than their existing premises, it suggests.

Office rents have seen no movement in districts of DIFC, Sheikh Zayed Road, Tecom A&B and Emaar Square in the past three months, with rental values ranging between AED100 to AED 50 per square feet per annum.

Older business districts such as Tecom C, Business Bay, Dubai Silicon Oasis, Deira and Bur Dubai have seen rents falling between 7 to 30% in the last quarter.

Prices have held steady in more prestigious office locations, such as the DIFC and Sheikh Zayed Road in response to demand. ‘This is an encouraging sign that the market is in recovery mode. However, overall, the market still shows a trend of downward pressure on rents that was seen throughout 2010, caused by the oversupply of new office stock,’ the report says.

Cluttons estimates that throughout 2011 an additional 10 million square feet of new office stock will come onto the market, the majority of which will be in new business districts of Tecom C, Business Bay, JLT and Dubai Silicon Oasis. Rents in these areas are predicted to show the largest falls.
 
‘Despite the high commercial vacancy levels, surprisingly, one feature holding back the commercial market is the mixed ownership of many office buildings and the relative lack of larger space available to lease from a single landlord.  This has led to some firms such as Standard Chartered building its own office space, tailor made to its own specific requirements, the report points out.
 
Vacancy levels in the market currently stand at an estimated 40% across Dubai. ‘This level appears to be increasing within some of the older, more established districts of the city such as Deira and Bur Dubai, as occupiers migrate to better quality office stock in the CBD areas of Sheikh Zayed Road, Downtown and the DIFC. Stronger demand in these areas has prevented prices falling, indeed these have held fast since the fourth quarter of 2010, it adds.
  
Cluttons notes the increasing flexibility of lease terms offered by landlords in light of high vacancy levels, who are more willing to offer larger rent free periods coupled with longer leases, and pay agency fees. ‘This is common practice in most foreign markets, and as more landlords attract these strategies, it will help drive Dubai's market to a higher level of maturity,’ it adds.


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Categories: Elysian UAE | Investment News