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In its pursuit of new business opportunities, Aqua Properties may have struck a genuinely win-win deal in one massive residential complex in Dubailand. The company, which offers a range of real estate services, bought more than a hundred apartment units at the Skycourts Towers as part of its focus on expanding and diversifying its portfolio, while identifying underserved market segments.
“We saw an opportunity to create a product that catered to a segment that was under served,” says Paul Christodoulou, COO of Aqua Properties.
Skycourts Towers is a building complex comprising six towers and more than 2,800 apartments. Developed by the National Bonds Corporation and completed in 2010, the Dh1.6-billion project is located in the Dubailand Residence Complex.
However, in a move that gives it a strong head start in the affordable housing segment, the company pulled a bigger surprise when it announced the pricing and payment schemes of its newly acquired assets.
With prices starting from as low as Dh375,000 for a studio, Dh764,000 for a one-bedroom apartment and Dh1 million for a two-bedroom apartment, Christodoulou says Aqua Properties is positioning the units within reach of households in the lower-income brackets looking to own their first homes.
“We don’t purposely target a specific audience, but I would say end users who earn below Dh20,000 per month would be most suited to this project,” he says.
On top of the pocket-friendly price scheme, Aqua Properties is also offering payment terms that reach up to eight years, a bold move especially in the ready property market. “This type of scheme is almost unheard of in Dubai,” says Christodoulou. “The payment plan itself has bank financing built in and allows the purchase without prior [bank] approval.”
While the pricing and payment terms provide end users easy access to home ownership, the company says the product has also attracted many investors because of the high level of occupancy and potential for high return on investment (ROI).
“The seven or eight-year payment plan, with potential tenants, allows investors to spread their costs without putting down a lump sum. ROI is in excess of 10 per cent if you factor in the time value of money that you pay over the period.”
Aqua Properties bought a total of 138 units from the development with a total investment of more than Dh121 million. The purchased units comprise studios ranging from 353-675 sq ft, one-bedroom apartments (733-843 sq ft) and two-bedroom apartments (1,062-1,287 sq ft).
The company has sold more than 90 units and Christodoulou says market feedback has been overwhelming positive. “[We have received an] excellent response,” he says. “We have sold far sold 60 per cent of all the units that we purchased.”
Service charges in the development is pegged at Dh10.25 per square foot, and while homebuyers also have to shoulder the 4 per cent transfer fee, the amount can be settled at the end of the seven- or eight-year payment term. Homebuyers also get one parking unit.
Source: Jobannie Tabada, Property Weekly