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Old September 10th, 2008, 01:30 AM   #21
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Value of properties on Reem Island found appreciating

Property prices on Reem Island, a commercial, residential and business project, across the coast of Abu Dhabi, have more than doubled touching Dh.3000 per square foot from Dh.950 over the past couple of months.

According to Vincent Eastone, Sales Director, Sherwoods Independent Property Consultants, a rapid growth has been noticed during the past three years, not only in terms of new projects, but also in prices of properties. The current Abu Dhabi market, although interesting, is largely led by speculation. Although speculation is healthy, as it helps attract international interest and attracts investors seeking short-term gains, it is not sustainable.

There exist high chances of creating a bubble effect. For instance, what should have been a gradual increase over a three year period is seen happening in nine-months.

A market attracting short-term investors will have a risk factor involved, as to whether the investors would remain committed and continue their future payment plans or whether they would exit.

Easton also pointed out that the situation is very much the same in Dubai. For instance, when during the first six months of this year, several people were crowding during the launch of residential units by Emaar at Downtown Burj Dubai, while only 200 to 300 units were available. There is still a huge demand for major projects, and this indicates that there is still a healthy level of interest in UAE.

When compared to other international cities, Dubai is comparatively a young market, maturing gradually. Establishment of RERA has been a major step ahead, although, there is need for more structuring regulations and transparency in the market. RERA and Dubai Land Department have done good jobs till date, Easton commented.
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Old September 13th, 2008, 08:47 AM   #22
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FGB - Sedrawan project

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Originally Posted by ferrari430 View Post
2400 - 2700 dirhams psf on the lilac tower - not particularly cheap though. the FGB project Sedrawan are selling for around 2200 dirhams psf - so a direct comparison
I found the Sedrawan project very attrative .. however, the is not much marketting of the project beign done by FGB aka GEP !
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Old September 14th, 2008, 10:39 AM   #23
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I'm thinking about investing in Abu Dhabi. Which according to you guys is the most ideal investment. I want to start small with maybe 2-3 M in investment, so suggestions fitting this budget would be great.

I've been offered some units in Hydra Executive (serviced apartments). Prices are around 2000/Sft which is pretty decent since its a waterfront development and the developers is well know. I'd like to make such multiple investments, hence wondering if you guys could throw in a few pieces of advice

Thanks.
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Old September 14th, 2008, 12:40 PM   #24
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Just bought a unit in Tala Towers... a little more than 1800psf all in... large developer in Sorouh... this should be a good investment given AD's "housing shortage" and the fact that this project will be one of the first of the newer buildings to be completed...

Just my best guess... or there's always Tameer Towers or Sky Tower... If only I had a time machine...
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Old September 14th, 2008, 02:58 PM   #25
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Tala tower - good investment for 1800 psf as you pointed out one of the first properties to complete on marina square reem island - i think both price appreciation when complete and rentals will be v good.

I also think 2000 psf for the Hydra apartments in city of lights are a great buy - especially I belive they have started construction - excavating/piling - and the location and price is good
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Old September 15th, 2008, 03:26 AM   #26
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ADIH plans $2bn realty project by year-end

Abu Dhabi Investment House (ADIH) plans to launch a $2 billion (Dh7.36bn) real estate project in the capital by the end of the year, Emirates Business has learnt.

The development, Porta Moda Abu Dhabi, will mark the three-year-old firm's entry into the UAE real estate market.

Porta Moda is the brand name of ADIH's planned $7bn series of mixed-use residential and retail projects concentrating on fashion and style.

"We have finished our due diligence and are going to announce the project in Abu Dhabi by the end of the year," said Rashad Yusuf Janahi, Managing Director and founder of ADIH. "It will be under the theme of Porta Moda and the size of the project is around $2bn. The concept will also be implemented in Qatar, Morocco, Tunisia and India."

Janahi said the Abu Dhabi development would feature a district containing premium and luxury brands in the fashion, jewellery and interior design fields as well as town houses, studios, luxury villas, cafes, restaurants, boutique hotels and spas.

ADIH has signed a memorandum of understanding with Emirates International Properties to create Porta Moda Abu Dhabi and with Gulf Finance House (GFH) to establish developments in Morocco – the Royal Ranches in Marrakech – and in Tunisia.

The firm has also signed deals with Qatar Entertainment City and India Entertainment City to develop Porta Moda Qatar and Porta Moda India, added Janahi.

He said a fund to finance the plans would soon be placed through an ADIH team and underwriters who are marketing it in the UAE, Qatar, Oman, Saudi, Bahrain and Kuwait. The fund is also being marketed to international investors based on high levels of indicated interest.

Since its inception in 2005 ADIH has been associated with major projects across the region including the Beirut Gate in Lebanon, Entertainment City Qatar and Sunset Hills, Porta Reef and The Lagoon – Amwaj Islands in Bahrain.

It is also involved in several investment funds in the region. ADIH recently exited the Lagoon Fund, its first fund exit, with a 30 per cent return on investment. The fund was launched in June 2006 to finance the $90 million Lagoon project in Amwaj Islands.

ADIH made a partial exit from the Al Arabi Equity Fund, which registered an internal rate of return of 25 per cent, above the initial 20 per cent target.

It also made a partial exit from Al Arabi Equity Fund, which will give an IRR of 25 per cent, above the initial 20 per cent target IRR.

And a $500m fund introduced and launched by ADIH is being used to implement the first of the firm's Entertainment Cities in Lusail, Qatar.
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Old September 15th, 2008, 10:21 AM   #27
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I bought some apts on Al Raha Beach...at around Aed 1,000 per sq ft...do you guys think I should hold on to them or sell them now?
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Old September 24th, 2008, 04:17 AM   #28
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Abu Dhabi on GIO radar for expansion

Galadari Investment Office (GIO), the luxury real estate development division of the Rashid Abdul Wahab Galadari Group (RAW Galadari Group), is considering expanding into Abu Dhabi.

"We are looking at Abu Dhabi seriously," said its Chairman Rashid Abdul Wahab Galadari. "We are in talks with investors there for a joint venture. We have not yet purchased land there."

GIO was established in 2005 and has projects worth Dh3 billion under way in Dubai. Galadari said delays in the construction of the company's flagship project, the G-Emporium, were "beyond the control of the developer". The complex was launched in 2005 but piling has just finished on the residential G-Tower and piling for the office building is due to begin shortly. "We only took a down payment from investors and nothing else," said Galadari. "In fact only recently the investors have made the second payment. It is a niche luxury project and we did not have people backing out."

The G-Tower is 51 to 52 per cent sold out while the G-Office Tower is all sold with units changing hands in the resale market. Current prices for the G-Tower are Dh2,000 per sq ft and for the G-Office Tower Dh1,600 to Dh1,700 per sq ft, said Galadari. Other family businesses include the Ilyas and Mustafa Galadari Group (IMGG), which is developing the City of Arabia in Dubailand. Galadari said the family's personal investment in the project totalled $5bn (Dh18.36bn).



GIO is geared highly towards the luxury segment of the market. What is the current return on investment for an investor in this market?

Currently, depending on the product and its location, a luxury-end investor can expect an average return of 23 to 25 per cent. We as a luxury developer are not out there to earn a certain return. We don't necessarily build to acquire a return, we are more concerned with putting up a quality development for an end-user buyer.

What is demand like in Dubai's luxury market segment?

Anywhere in the world luxury products are always the strongest segment to invest in. In Dubai, buyer interest in the luxury segment has come from a mix of Asian, Eastern European and Gulf Co-operation Council investors. The buyer is always somebody who wants to make a statement with his property. In Dubai there are enough choices available for a luxury buyer.

Are you more interested in residential rather than commercial projects?

We do have a commercial product with the G-Office Tower but we are developing more residential buildings. Commercial projects signify a more serious sort of development than residential and we are still trying to find a good brand association and a partner in the market.

What is the difference in premium between a branded and a non-branded product?

Where a brand name is associated with a project there is definitely an automatic premium. For example we have quality control partners such as Philippe Stark who ensure a certain interior and exterior look is maintained within our projects. That will mean more costs going into the project and hence a buyer reaping a higher premium from it as a result. However ultimately for a developer the premium will depend on how he is going to use his brand in the best possible way.

What challenges do you face building luxury products in Dubai and how much control does a developer or master developer has from a design perspective?

The challenge is about creating a similar style of quality interior in all the units of a luxury development. A master developer or a developer of a luxury product cannot at the end of the day influence a buyer's taste in interiors. What we can do is set loose guidelines to the buyer and try and reassure them of the interior styles we have to offer.

What is your current portfolio and why are we hearing less about GIO? You have not announced anything recently.

GIO has so far launched projects worth Dh3bn. The G-Emporium is GIO's flagship project and is worth more than Dh2bn. It is being built in partnership with Yoo, a Philippe Starck company, and comprises two 45-storey towers. The G-Tower is a residential venture and the G-Office Tower is a commercial development in the City of Arabia. We don't believe in launching too many ventures since we are developing luxury projects and they need to have a certain level of quality. We are launching our third project, a residential one, at Cityscape. You don't see us advertising much here because there are people backing our project. GIO is heavily promoting its developments in international markets. We may not have launched a project this year, but we have been busy signing strategic partnerships. In April we officially launched the G-Emporium in collaboration with Yoo. Philippe Starck is responsible for the interiors. In June the Italian fashion house Gianfranco Ferré entered into a worldwide joint venture with us. Under the deal, GIO will be the official developer for all Gianfranco Ferré real estate projects and will be fully responsible for real estate, construction, management and operations, whilst Gianfranco Ferré will oversee all aspects of content, design and style.

What will be your first project with Gianfranco Ferré?

It will be a mixed-use development, Gianfranco Ferré Stresa in Dubai. The project is worth more than $1.2bn.

Are you also looking to develop in other emirates?

We are looking seriously at Abu Dhabi. We are in talks with investors there to do a joint venture with us, but we have not yet purchased land there. It is not that we don't want to invest in land. We would like to develop cautiously in the UAE bearing in mind the current international scenario.

How are you financing your projects?

For the G-Tower we have taken finance from the Abu Dhabi Commercial Bank. Every project will be funded in a case-by-case manner. We are always comfortable having construction finance as a backup. There is a dearth of construction finance as every bank treats a developer differently. Finance availability is always dependent on the background of the developer.

What are your thoughts on curbing speculation? Where is the market heading at the moment in Dubai?

Speculators are essential as they generate momentum in the market, but they have to be encouraged in a controlled manner. Dubai in terms of prices is a positively abnormal market. Regulations from the Real Estate Regulatory Agency will make the market sensible. It is bound to grow as this place continues to remain attractive.



Rashid Abdul Wahab Galadari: Chairman, RAW Galadari Group

Rashid Galadari was born into an entrepreneurial family and established the RAW Galadari Group after graduating from university. As chairman he has driven and expanded the business across the Middle East for many years. Galadari's vision is to expand the business across the region and spread the family name abroad. He has played a strategic role in the City of Arabia development in Dubailand.
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Old September 24th, 2008, 04:53 AM   #29
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Proposal to reduce annual rent hike cap to 3% in Abu Dhabi under study

A proposal to reduce the annual rent hike cap from five per cent to three per cent in the capital is being studied by the Abu Dhabi Executive Council (Adec), Emirates Business has learnt.

A high official of the emirate revealed the Abu Dhabi Council for Economic Development (ADCED) has submitted a detailed study to the Adec on the harmful effects of high rents in the capital, especially in terms of growing inflation and decrease in foreign investments.

The ADCED had also suggested the practice of increasing rents annually be stopped, along with its suggestion of a three-per cent cap. The study, however, favoured the reduction of the rent increase from five per cent to three per cent, rather than doing away with it. The final decision is due to be issued in the beginning of next year.

"The emirate is serious in its efforts to curb inflation. The aim is to reduce inflation to at least eight per cent following the decline in the prices of oil and raw materials," the official said.

Meanwhile, the Department of Planning and Economy (DPE) has agreed with ADCED's recommendations about the reduction of annual rent hike and has already conveyed this to the Adec.

The DPE conducted its own study, which established that rent was the most important factor in the increase of inflation to more than 11 per cent in Abu Dhabi since the beginning of 2008. It also warned high rents pose a danger to attracting and retaining foreign investment.

The DPE's study said despite inflation, foreign investments in Abu Dhabi have risen by 25 per cent over the last three years to touch Dh17.8billion. A decrease in rents, however, would help increase that figure in the future by several times, it said.

The DPE expects the total foreign direct investments in the emirate in the current year to touch Dh30bn. It said serious attempts by the government to end accommodation crises and control the residential and commercial rent markets were the main factors behind the increase in foreign investments.

Emirates Business found the rents in new buildings in areas such as Al Najda, Airport Road, Hamdan and Al Salam Roads in Abu Dhabi range between Dh200,000 for a unit of two bedrooms and a hall and Dh300,000 for a three-bedroom-hall apartment.

According to property dealers the demand for such buildings was low among Arab and Asian residents in the capital and they were rented almost exclusively by Western expatriates, especially corporate executives, oil sector employees and teachers of top universities.
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Old September 24th, 2008, 09:03 AM   #30
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Quote:
Originally Posted by dlnash View Post
I bought some apts on Al Raha Beach...at around Aed 1,000 per sq ft...do you guys think I should hold on to them or sell them now?
It depends on how long term you are thinking...if you could hold on to them for the next 5 years you ll definitely happy then...
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Old October 5th, 2008, 03:49 AM   #31
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Special report : Buying a property in Abu Dhabi

http://www.ameinfo.com/buying_property_in_abu_dhabi/
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Old October 10th, 2008, 03:18 PM   #32
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Abu Dhabi Stretching ... Al Reem stretched !!!

Al Reem seems to be getting quite expensive and the signs of slow down were already there. Burroj launched their towers at AED 2,200 and Gate Arch was launched at AED 2,450. Only Reem Diamond was launched at AED 3,200, but they were struggling to sell and by the 2nd day were offering heavy discounts. By the 3rd day they were actually at the gate distributing their brochures and getting people to their stall. The prices are getting expensive and to have one bedroom apartment at 2 million plus is on the higher side. To recover your mortgage you need atleast a rent of AED 160,000, which might not be sustainable. Also the 2 million tag is assuming a price of AED 2,400 / sq.ft. Once we get to AED 3,000/sq.ft then we might need to get a rent of AED 220,000 for 1 bed.

Also if I sell after buying from resale or from developer the next buyer will have to put atleast 1.5 million as down payment. Thus, buying from developer is getting very risky, but there is still good potential if you get from resale. Sky Tower is still available from AED 1,800 in the resale market and will sell when it is ready by next year. Apart from that, everything else is getting too expensive, if you look at getting rent out of the same.

The rents are sustainable now, but people who are paying high rents are desperate, but now lot of people are turning down jobs to Abu Dhabi. Yes, lot of expats are still coming, but most majority earn below AED 10,000 / month and will struggle to rent these apartments. Though you are right, if 5 of these were put in 1 bedroom apartment on Reem, then they can afford it.

The other thing that worries me is that ADNOC and Etihad are building their own residential towers. If you take out staff of Etihad and Adnoc related companies, then affordability dips even more. Unless somebody has different population numbers, I am worried about the market here.
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Old October 11th, 2008, 10:35 AM   #33
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Quote:
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Al Reem seems to be getting quite expensive and the signs of slow down were already there. Burroj launched their towers at AED 2,200 and Gate Arch was launched at AED 2,450. Only Reem Diamond was launched at AED 3,200, but they were struggling to sell and by the 2nd day were offering heavy discounts. By the 3rd day they were actually at the gate distributing their brochures and getting people to their stall. The prices are getting expensive and to have one bedroom apartment at 2 million plus is on the higher side. To recover your mortgage you need atleast a rent of AED 160,000, which might not be sustainable. Also the 2 million tag is assuming a price of AED 2,400 / sq.ft. Once we get to AED 3,000/sq.ft then we might need to get a rent of AED 220,000 for 1 bed.

Also if I sell after buying from resale or from developer the next buyer will have to put atleast 1.5 million as down payment. Thus, buying from developer is getting very risky, but there is still good potential if you get from resale. Sky Tower is still available from AED 1,800 in the resale market and will sell when it is ready by next year. Apart from that, everything else is getting too expensive, if you look at getting rent out of the same.

The rents are sustainable now, but people who are paying high rents are desperate, but now lot of people are turning down jobs to Abu Dhabi. Yes, lot of expats are still coming, but most majority earn below AED 10,000 / month and will struggle to rent these apartments. Though you are right, if 5 of these were put in 1 bedroom apartment on Reem, then they can afford it.

The other thing that worries me is that ADNOC and Etihad are building their own residential towers. If you take out staff of Etihad and Adnoc related companies, then affordability dips even more. Unless somebody has different population numbers, I am worried about the market here.
After having done not too badly in Dubai, I looked at AD for investment a few months ago for investment purposes on cash basis. I prefer buying properties which are already under construction and Sky Tower came up. Even though I had to pay a substantial premium and an initial cash outlay, I found it to offer the best value to hold until completion. My purchase price was around 1800 psf and I was offered 1900 psf the next week. (Are you certain about present availability at 1800 because I was under the impression that prices had moved to 2000+?)

About new launches. I agree that it feels a pricey and it interesting that developers are giving discounts for these projects. Gives an indication of sentiment.

People earning in the Dhs10,000 range will continue to struggle for affordable housing in AD and developments on Reem Island when they come online will not provide any kind of respite to income earners in this range.
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Old October 11th, 2008, 12:13 PM   #34
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Last I checked, Asteco and Better Homes had properties at that price. Check with them. You should still get below AED 2,000.

Another interesting fact is that most of the banks have stopped giving loans to individuals from real estate companies. I don't want to put names, but from the top 3 local banks, three have confirmed that.

Burooj has launched properties at 2,200, where Islamic bank (its parent) is offering financing up to 90%. But, if you pick property above AED 2,500, they are offering only 75% financing. Take the hint.

The biggest surprise was launch of Gate Arch at AED 2,500. That just states that an established brand also did not take their price above AED 2,600.

My other worry is that if we all struggle to sell properties around 1,900, how can we sell around current developer's price, if we pick coz of attractive payment plans. This could get serious where people who have picked above AED 2,400 will struggle to sell in the resale market and if they can't arrange for financing might land up defaulting. Its a market for sensible people as there is money to be made, but research has to be rock solid.
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Old October 12th, 2008, 12:13 AM   #35
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I have just picked up Marina Spirit Reem island at 1550/sqft. As mackerian said I had to put a little bit more cash down because of the premium involved but I feel the market has turned now slightly and we should look at longer term holding and buying as cheap per sqft as possible per sqft rather than these payment plans and over inflated prices off developers. If anyone interested I can give you the name of the broker who has got the deal as I believe he got a few more. I think market is at least 1850/sqft

cheers
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Old October 12th, 2008, 11:12 AM   #36
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Has anyone got the new masterplan for Al Reem Island? With plot numbers?
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Old October 12th, 2008, 01:41 PM   #37
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I have a number of good units in Al Raha and Al Reem for resale, below 2000 Dhs per SqFT
PM me
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Old October 12th, 2008, 02:50 PM   #38
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I have a 1 bed Tameer Tower B canal and park view for sale at 1950 psf if anyone is interested. Please pm me also.
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Old October 12th, 2008, 04:28 PM   #39
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Advertising isn't allowed my friends
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Old October 12th, 2008, 04:45 PM   #40
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Sorry!
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