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With no shortage of luxury property on the UAE market, standing out from the crowd and offering a unique proposition to investors can be difficult. But with Anantara Residences on the Palm Jumeirah, developer Seven Tides took an unusual approach, selling the bulk of the development as fully completed units, and the penthouses at a starting price of $5.5 million (Dh20.2 million) as “blank canvases” for design-conscious buyers.
“The properties are quite literally a shell,” says Seven Tides CEO, Abdulla Bin Sulayem. “Each penthouse can be tailored to the preferences of the buyer.”
It’s a tactic that appears to have paid off, with sales now hitting Dh750 million. Eighty-five per cent of the development’s South Tower is in the hands of buyers and just five of the 12 penthouses not either sold or under negotiation.
The company also took the bold step of offering deferred payment options for customers who needed a little time to raise the full capital needed to buy into the development, while Bin Sulayem says the option for owners to market their properties through the development’s hotel rental scheme has proven extremely popular with those looking to capitalise on their investment immediately.
• What type of customer has been most interested in these properties?
There has been a wide variety of investment enquiries from all over the world, including Russia, India, Saudi Arabia, South East Asia, the UK and Western Europe.
The luxury penthouses rank up there with comparable investment opportunities in other trendy global destinations such as Paris, Barcelona and Vancouver, but still offer remarkable value for money compared to properties in London or New York.
• Upon release, the properties were sold completed, rather than off-plan. Why was that decision taken and what advantages did it offer?
Due to the global credit crunch, financing properties was extremely difficult. We were strong financially and confident we would be able to sell the properties within the economic environment.
We had the advantage of having a completed development over those that had stalled and buyers had the advantage of being able to move straight in.
• You launched the penthouses at Cityscape last year. Will the remainder of the development be showcased at Cityscape 2015?
Yes, Cityscape Dubai is a premier show for the in dustry and a great place for developers to meet and do business.
• What proportion of buyers have chosen to benefit from the deferred payment scheme on apartments?
There has been a 16 per cent uptake from new sales capitalising upon the deferred scheme on apartments. The payment scheme was created to allow us to target the smaller independent investor who had the initial capital to secure a property, but perhaps needed more time to fund an outright purchase.
• How popular has the hotel’s rental scheme proved with customers?
Aimed specifically at independent bespoke investors, who want a guaranteed minimum return on investment (ROI) for a modest capital outlay, the rental scheme has been extremely popular, with 42 per cent of customers utilising this opportunity.
Besides the ROI, investors are also secure in the knowledge that their property is being maintained to five-star standards, supporting capital appreciation.
Under the programme, the Anantara Dubai The Palm Resort and Spa cleans and services the apartment and manages guest reservations to maximise potential revenue opportunities.
Guests and residents also have exclusive access to the hotel facilities on offer, including a gym, 107,600 sq.ft. of temperature-controlled lagoon pools, a signature spa plus six dining and entertainment venues.
• With so many new developments coming to the Dubai market, is the Palm Jumeirah still among the most popular areas for investment among high-net-worth individuals?
The Palm has proven to be one of the top real estate markets for either buying or renting in Dubai.
The latest price for Palm Jumeirah apartments, according to property management company Asteco figures, was Dh2,000 per square foot, while for villas, the price was Dh 2,850 per square foot.
Furthermore, the same report also highlighted that the Palm Jumeirah is the only development that has experienced an increase from its fourth-quarter 2008 prices, up 4 per cent.
• Would you expect this to continue in the coming years?
I see this trend continuing as the Palm matures and the remainder of the crescent projects come on line.
We are now seeing the true value of the Palm coming to the forefront of the Dubai real estate market as it establishes itself as a unique apartment and villa community, appealing to both local and international buyers.
• Have you seen any evidence of unrest in the wider region impacting the UAE market?
Yes, macro issues of both a political and economic nature have affected investor sentiment.
• What impact has that had on the market over the past year and what changes do you envisage in the near future?
Following two years of strong growth for Dubai’s residential sales, 2014 was a year of stabilisation with moderate growth during the first half of the year followed by a decline in the second.
The slowdown in activity for the second half of the year can be attributed to the delivery of new supply and the impact of low global oil prices on key source markets such as CIS and GCC countries.
Looking to the future, sales prices in sought-after communities, such as the Palm Jumeirah, are likely to see stability and in some instances growth given the 2014 trends for this particular area of emirate.
Source: Jennifer Gibson, Special to Property Weekly