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Azizi Developments formally launched two serviced apartment properties in Al Furjan, within the Dubailand master development, to become the latest UAE developer to enter the hospitality sector.
The developer plans to launch a further seven such projects in the same area over the coming months, with the first two scheduled for completion in the third quarter of 2017.
The location makes sense “not just because of the Expo 2020 and the [Al Maktoum International] Airport,” said Farhad Azizi, CEO and Vice-Chairman, “but because of the Dubai Parks and Resorts opening [October 1]. When we did our market research, our consultancy [PKF] advised that a hospitality product was missing in that area. If Al Furjan was strictly for residential before, that profile is changing.”
Along with its recently announced project on the Palm — where it plans to add a second one shortly — Azizi’s portfolio in Dubai has swelled to Dh3 billion-plus.
The developer is eyeing new plot purchases in Business Bay, which could also be acquisitions of stalled projects, and on Reem Island, its first move into Abu Dhabi. Jumeirah Village Circle is another area of interest.
Dubai’s master-developers like Emaar, Nakheel, Meraas and Damac already have substantial hospitality components on their books or are building them.
It is now a theme being picked up by others, though the emphasis is on doing so in less saturated locations.
“The Al Furjan properties will offer buyers the option to live or keep them in a rental pool, and all the while being able to have hotel-type services they can call on,” said Azizi.
The developer has called in Candace, a hospitality management firm in which it owns 25 per cent, to handle the new set of properties.
The CEO said that raising the equity further in the UK-registered entity was not on the agenda “at the moment”.
“On the first of the Al Furjan properties, we have 80 per cent of unit sales, and 25 per cent on the second,” Azizi added. “The plan is to come out with the other seven releases in gaps of three months or so.”
The pace of off-plan launches has picked up in the second quarter. With developers keen to explore emerging locations such as clusters within Dubailand and Culture Village, the project mix is also getting subtle alterations.
It opens up buying choices across a wider pricing spectrum rather than just be dominated by those in the Dh1,300 per square foot-and-over range.
The twin ‘Candace’ projects in Dubailand’s Al Furjan cluster have a development value of Dh460 million.
With future releases, Azizi Development’s serviced residences portfolio will number 2,000 units by end of the year.
“We also feel that serviced apartments are fast gathering popularity in Dubai since they provide all the services of a standard hotel service, but at a much [smaller] cost,” said Azizi, the CEO.
Prices start at Dh433,000 for a studio, while one bedroom units are priced between Dh800,000 and Dh1 million. Two-bed units are priced at around Dh1.2 million.
Source: Manoj Nair, Associate Editor, gulfnews.com