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Ajmal Group has been known for its perfume business, but in 2008, it ventured into real estate development with a project in Dubailand. Ajmal Sarah, a 16-storey residential complex, was named after two of the most important things to the company: Ajmal, which means beauty in Arabic and is the family name of the founders, and Sarah, the most successful fragrance the group has launched with millions of bottles sold over the years.
The project was conceptualised during the property boom in 2006-07 and launched in 2008, but the global financial crisis halted its progress. Despite trying times, when many real estate companies shut up shop and abandoned investors, Ajmal Group decided to hold on to its maiden project.
It took the company six years to near completion of the project, having had to endure tough times to protect the family’s reputation and investor interest during this period.
At the time of the launch, the group sold 130 units, roughly 40 per cent of the inventory. As the crisis grew deeper, it was no longer feasible to sell at market prices, so the firm decided to halt sales. However, construction continued through the group’s funds.
As the project inches towards completion, the remaining 40 per cent of residential units will be released on the market. The group will hold on to the remaining 20 per cent, consisting primarily of commercial and retail space for leasing.
Fakhruddin Ajmal, Founding Director and COO - Real Estate of Ajmal Group, talks to PW about the project and the group’s foray into the real estate industry.
* How would you describe Ajmal Group’s journey in the real estate industry?
It’s been very interesting. It started over two decades ago. Like the journeys we take in life, this one also had its ups and downs. We began investing in off-plan projects from reputed builders in India, mainly Karnataka.
Then we moved on to investing in land banks to build our own projects. Today, we are a month away from our biggest milestone in this journey. We will be delivering our first project - Ajmal Sarah.
* What makes Ajmal Sarah stand out?
We have built the project based on the concept of affordable luxury. The useable space within the apartments is larger than what you see in most developments. Residents will enjoy the openness, which we believe is the most important thing for happy living. In addition, we have family spaces, separate health clubs and gyms with saunas for men and women, ample free underground parking, a children’s play area and retail space for convenience. We want the residents of the tower to feel at home, surrounded by comfort and convenience.
* What will be the prices of the remaining units?
In 2008, we launched at Dh850 per square foot. Various market dynamics drove them up to Dh1,250 before the market crashed. Post-handover we will be introducing the units at the current market rate of roughly Dh800 per square foot.
It’s important to know that Ajmal Sarah is built with high-end specifications. Even during troubled times, we did not compromise or change any specifications. We have built a tower as promised.
* Which banks are financing the tower?
The tower is complete and will be handed over soon. Most banks in the UAE offer financing on finished projects. However, we have tie-ups in place with Emirates Islamic Bank and Mashreq. We will be building similar relationships with other banks to provide easy financing for our customers.
* What is your advice to investors in Dubai?
The time of speculators has gone. If one intends to speculate, I advise staying away and looking elsewhere.
Moreover, ready property is always a good choice for investment. Those who can afford to invest in a home should consider purchasing one. It makes a lot of sense to buy as oppose to paying rent. The latter is an expense, [but] equated monthly instalments [for your own home] build an asset.
I often come across the question, “Is it the right time [to buy]?” It’s always the right time when you have the means to invest. No one can predict the future or bring back lost time.
The fundamentals of the UAE as a country are very strong - the government is building a world-class country and the population is growing at a healthy pace.
These are the two basic [criteria] when investing in a nation. These are followed by the right location, project and builder, which should also be considered wisely.
* How did you manage the 2008 downturn and the delay of your project?
Like every other player in the industry, the 2008 downturn left us helpless. Slowing down or calling off the project were the [only] two options. We took the braver choice and decided to slow down construction and build the project.
Six years down the line we have finally approached the handover date. Throughout this period we operated as per the Real Estate Regulatory Agency guidelines, maintained an escrow account, only demanded instalments as construction progressed and funded the majority of the project through the group’s funds.
* Are you planning to launch anything new?
We have land banks in India - Delhi, Bengaluru, Mumbai and our home town Assam - and the UAE. In Dubai we have four more plots in addition to Ajmal Sarah. We are currently working and finalising a project in the emirate and will be [making an announcement] in the next six to eight months. It will be a G+12, located in Downtown Jebel Ali, 500m from the Jebel Ali Metro station and 2km from the World Expo 2020 hub.
There is another project we are working on in Dubailand, close to Ajmal Sarah. When the time is right, we will bring it to the market. These projects are at the conceptual stage. For now, our focus is to deliver Ajmal Sarah and let people experience our commitment to quality.
“Like every other player in the industry, the 2008 downturn left us helpless. Slowing down or calling off the project were the [only] two options. We took the braver choice and slowed down construction and build the project.”
Source: Ashutosh Gupta, Special to Property Weekly