Fast track flight to quality

uae propertyImage Credit: Supplied

Short-term demand for real estate in Abu Dhabi will be fuelled by jobs generated from major construction projects such as the airport expansion, Etihad Rail, Saadiyat Island museums and other key infrastructure, economic and social development initiatives.

The Abu Dhabi government has allocated around $100 billion (Dh367.3 billion) to develop its social infrastructure, including health care, education, housing, transportation and aviation until 2020. Around Dh7.6 billion and Dh11 billion have been allocated for the Shaikh Zayed housing project and for a subway system respectively.

All this means more jobs and more demand for realty projects in the capital.

"We have seen a move to quality. There is a trend for people to look for newer property as they come with proper facility management in place," says Jane Irvine, Director of Business Development at LLJ Property. "They expect to have a polished lifestyle with parking spaces and community facilities.

All of this comes in the newer lot of properties.

"But long-term residents in the capital have different expectations. Many prefer to stay in older buildings, which are larger. Having said that, they too want a property manager for their buildings."

Property consultancy JLL has also confirmed that demand is at its peak for property with superior amenities. "In fact, there is a shortage of good-quality products in Abu Dhabi that meet end-user requirements," says David Dudley, Regional Director and Head of JLL's Abu Dhabi office.

The bulk of the new stock is currently concentrated on Reem Island, according to Asteco. "City of Lights is likely to start delivering products at the end of the year- a couple of projects are to be released that are likely to be attractive leasing options," says Jeremy Oates, General Manager - Abu Dhabi at Asteco.

But the pace of activity is slower this year compared to last year. "The market is going through a quieter phase," says Oates. "'t is slower this year but more stable - a breather if you like."

Government initiatives to boost Abu Dhabi's realty sector seem to be paying off as prices and rents of high-quality projects are consistently on the up.

"Abu Dhabi's real estate market turned the comer at the start of last year, with the residential market leading the recovery." says Dudley. "Demand for housing and rentals have both improved in the past year."

Experts say new government policies geared towards improved infrastructure as well as creation of new jobs have propelled the realty sector. "There is a renewed confidence in Abu Dhabi's realty sector - more people are coming to work here,'' says Irvine. "The health and education sectors are expanding too. Supply and demand are on par at the moment, therefore keeping prices stable. Saadiyat continues to be a popular area and is one of the areas in Abu Dhabi where there is more demand than supply. We are always looking for property here."

According to JLL, high-quality residential property prices rose 2S per cent last year over 2012 figures. The first quarter of this year saw prices rise 9 per cent compared to last year, with those on Reem Island averaging around Dh1,550 per square foot from Dh800 last year.

Rentals have also done well, recording a 17 per cent growth last year. During the first quarter, rents went up by 4 per cent and could go higher due to the rental cap removal in November.

According to JLL older parts of Abu Dhabi such as the Tourist Club area have witnessed substantial rent increases. "This is because they have risen from a very low base after many years of rent cap," explains Dudley.

According to LLJ Property, the removal of the rental cap in November has encouraged people to buy property in the capital.

"People are becoming more confident the Abu Dhabi market is here to stay and that it has recovered. People are thinking of buying rather than renting property after the rent cap removal," says Irvine. 

New developments in the capital

Abu Dhabi Plaza
Developer: N/A
What: One and two-bedroom high-end apartments
Location: Najda Street, opposite AI Mariah Mall
ProJect status: Ready to occupy
Leasing rate: One-bedroom apartment (938 square feet) at Dh95,000 per year; two-bedroom apartment (1,190 square feet) at Dh125,000 per year
Amenities: 24-hour security, swimming pool, gym, underground parking. central AC, built-in wardrobes Other fees and conditions: Minimum one-year lease. A 5% security deposit

Gate Towers
Developer: Aldar Properties
What: Mixed-use development with more than 3,500 units of studios, one-bedroom, two-bedroom and threebedroom apartments, town houses and penthouses with panoramic views of the Arabian Gulf and Abu Dhabi skyline
Location: Shams Abu Dhabi, AI Reem Island
Project status: Ready to occupy. More than 180 units were leased or sold in December. During first quarter, 814 units were handed over
Selling price: Dh1.3 million for a two-bedroom apartment
Leasing rate: Dh135,ooo per year for a two-bedroom apartment
Amenities: A leisure podium with swimming pools, tennis and squash courts, children's play areas, day-care centre, prayer rooms, recreational rooms and more

SkyGardens Tower
Developer: General Housing Company (GHC)
What: 271 residential units of one-bedroom, two-bedroom, three-bedroom and duplex apartments
Location: AI Reem Island right off AI Maryah Island and close to the new financial district, Cleveland Clinic, the Rosewood Hotel and Galleria Mall
Project status: Tentative completion date in December next year. Half of the project has been sold. Sky Gardens Tower will be relaunched by its new developer, GHC
Selling price: LLG Property, exclusive sales agent for the tower, is currently registering queries from interested parties
Leasing rate: N/A
Amenities: Gym, swimming pool, a club area and an openair terrace

The Arc
Developer: Aldar Properties
What: Residential building of studios and one-bedroom and two-bedroom apartments
Location: Shams Gate District, AI Reem Island
Project status: Ready to occupy. First phase of leasing began this month
Selling price: One-bedroom apartment at Dh1.5 million
Leasing rate: Two-bedroom apartment at Dh148,000 per year; one-bedroom apartment at Dh96,800 per year. The developer Is offering four weeks of free rent to new tenants
Amenities: Sky court gardens and terraces, swimming pools, a lazy river, tennis, squash and multipurpose courts, gym, children's play area, sauna and jacuzzi, underground parking, 24-hour security and easy access to Boutlk Sun and Sky, which has a Waitrose supermarket and several food and beverage outlets and convenience stores

Developer: Aldar Properties
What: 540 studios and onebedroom, two-bedroom and three-bedroom apartments
Location: Yas Island, overlooking the Yas waterways and close to Yas Mall, Yas Waterpark, Ferrari World and Yas Beach
Project status: Construction to begin next year. Off-plan sales began last month
Selling price: N/A
Leasing rate: N/A
Amenities: Infinity lap pool, children's pool, sunbeds and loungers, a pool bar, open spaces for events, gyms. A multipurpose hall to host Indoor functions and a barbecue area

AI Hadeel
Developer: Aldar Properties
What: Mid-rise residential development comprising 230 apartments and town houses.
Location: AI Raha Beach waterfront promenade
Project status: Construction to begin next year. Off-plan sales started last month
Selling price: N/A
Leasing rate: N/A
Amenities: Swimming pools, a gym, rooftop decks, a playground, barbecue and private party facilities and convenient access to retail and food and beverage outlets along the waterfront promenade

Nareel lsland
Developer: Aldar Properties
What: Waterfront villa community comprising 143 villa plots for UAE nationals to develop
Location: Next to Emirates Palace and Etihad Tower
Project status: Construction to begin next year
Selling price: N/A
Leasing rate: N/A
Amenities: All purchasers will be provided with clear design guidelines, to ensure all villas are developed in consonance with the community's aesthetic Identity

Source: Anjana Kumar, Special to Property Weekly


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