Leasing of Single Business Tower in Dubai Announced by DIP

One of the leading developers in the UAE, DIP- The Dubai Investment Properties, has announced the beginning of the leasing process of their latest commercial development called Single Business Tower.

The company is to lease 248 office units and 7 retail units at their new tower on Sheikh Zayed Road.

According to Anj Viadi, the Property Manager of Single Business Tower, the tower has been completed much ahead of the scheduled date. The tower has been given its central location, elegant façade and the modernized interior serving as an ideal business location for various companies seeking brand recognition.

He added, “The building incorporates energy efficient and self-sustaining features, with 248 modern offices and retail spaces spread across its 45 storeys. The green building guidelines have been followed to ensure energy efficiency, the big French windows help in capitalizing natural lights, while glass panels help divert heat and minimizes A/C consumption. The Single Business Tower also has advanced security and fire protection systems that ensure security of tenants at all times.”

Apart from all this, the offices within the business tower are designed in a way that they ensure maximum space efficiency and functionality. There are a several amenities and service outlets have been added to compliment a functional business environment.

This will make the Single Business Tower an attractive option for the business seeking to establish their main branch offices offering round the clock management services, ample parking space propinquity to the Business Bay metro station and the awesome views of Arabian Sea and Burj Dubai.

Along with the first class office retail spaces, the tower also offers reception and concierge services to tenants, a conference room which is fully furnished, business lounge, separate gymnasium for men and women both, a multi-level car park for tenants, business services and other management facilities.

Development of Facilities by Landmark in UAE

A property and facilities management solutions in order to safeguard the investment of freehold buyers has been developed by Landmark Properties, one of the leading property brokerage firms and consultancy in the UAE.

The firm offers solutions to real estate clients all over the world and delivers authoritative, comprehensive as well as independent advice. The affiliates of Landmark include Landmark Advisory and Amlak Finance PJSC which are recognized as the top level real estate companies of the Gulf.

Landmark Properties has developed a property and facilities management solutions to safeguard investment of freehold buyers.

The Head of Property Management of Landmark Properties, Donna Newman said, “A robust property management strategy is key for both overseas and UAE-based property owners as we deliver a range of cost-saving options, from identifying snags in new properties being handed over, to managing the rental relations with tenants on their behalf.

"The potential cost savings for proprietors using Landmark's Property Management (LPM) services, and homeowners using facility management services, far outweigh the service repair costs, in addition to minimizing potential future problems that can occur in a freehold property." He said.

The cost of Landmark Properties' Property Management solutions begins at five per cent of a property's rental value, with the minimum set at Dh3, 000.

Newman also said, "A landlord requiring property management for their unit will find that the preventative costs of our packages may be minor to the actual cost of potential problems in this apartment."

He added, "For instance, the rectification of ceiling defects would cost approximately Dh2, 000 for owners to fix. Common bathroom snags, including leaking toilets and showers or shower heads snapping off are on average Dh400-600 per visit by plumbers to rectify. Looking at these snags, this is already a considerable cost without taking into consideration anything else that may happen throughout the year."

Dubai Developer Nakheel Bailed Out by Abu Dhabi

The struggling Dubai based developer Nakheel, property arm of Dubai World and the back behind master projects like Palm Jumeirah, The World, Jumeirah Islands, Discovery Gardens etc.; has been bailed out finally by Abu Dhabi by enabling it to pay off a $4.1 billion sukuk bond.

The Chairman of the Dubai Supreme Fiscal Committee, Sheikh Ahmad Bin Saeed Al Maktoum, said, “The Government of Abu Dhabi has agreed to fund $10 billion to the Dubai Financial Support Fund that will be used to satisfy a series of upcoming obligations on Dubai World.”

He further added, “As a first action for the new fund, the Government of Dubai has authorized $4.1 billion to be used to pay the sukuk obligations that are due today.  The remaining funds would also provide for interest expenses and company working capital through April 30, 2010 - conditioned on the company being successful in negotiating a standstill as previously announced. In addition, the Government of Dubai is particularly focused on addressing the concerns of Dubai World trade creditors within the Emirate of Dubai.  To help address these concerns, today the Government of Dubai is announcing that the remainder of the funds provided will be used for the satisfaction of obligations to existing trade creditors and contractors. Discussions with affected contractors will begin in short order.”

The total debt of the Dubai government and its state-run companies is a minimum of $80 billion and some experts believe it could run into $100 billion plus. Today’s cash is not the first bail out from neighbouring Abu Dhabi. Two Abu Dhabi controlled banks subscribed last month to a $5 billion bonds package issued by the government of Dubai and the UAE central bank provided a $10 billion bond in February earmarked to help Dubai sort its debt problems.

Dubai Pearl Expected to Conclude by 2013

Abdul Majeed Esmail Al Fahim, Chairman of Pearl Dubai, announced the completion of Dubai Pearl, which is to be the mixed-use luxury development by Pearl Dubai FZ LLC, by 2013. The project will prove to be another magnum opus in Dubai real estate.

Dubai Pearl was supposed to be completed in 2007 originally but had been delayed due to lack of funds. The project will be handed over in almost three phases. First handover will take place in 2011 with the whole development expected to be completed in 2013.

According to the Chairman, the project has adapted to the financial environment in order to reach the completion. With the purpose of adapting to the economic state of affairs, major areas are being prioritized for completion. The focus is observed through the steady development and delivery of the project, payment plans offered to the investors which are flexible enough and tailor-made, to have transparent relations with the partners and campaign to enhance awareness on all the components of the project is planned efficiently.

This $4 billion project is located at the Dubai Technology and Media Free Zone. It is a business huddle operated by Tecom Investments and is considered to be the home to global IT and other media companies. The aim of the development is to become a luxury free zone as well as a freehold development with an easy access to transport links.

The associated structures of this development by Pearl Dubai are its four distinctive towers which are linked together from the top. The skyscraper includes residences, hotels, entertainment facilities and other global names like Baccarat, MGM, Sky lofts and many more.

The partnerships of Pearl with these brands aim at the long-term returns for the stakeholders of the development.

There are approximately 1440 residential units and 618 apartments which make 40% of the project. The hospitality sector comprises of about 16% and commercial sector that of 33%. Rest of the space is occupied by retail and leisure.

Over 900 residents are expected to be accommodated by Dubai Pearl and about 12000 employees are expected to be employed by the commercial sector. Dubai Pearl is also aiming at receiving Golf LEED Certification.

Selling of Dubai Assets to Help Dubai World Turned Down

A top Dubai Government official confirmed that Dubai is not going to sell any of its assets to bail out Dubai World. He also added that the group will be able to overcome the situation by restructuring its debts and selling its own assets.

Abdul Rahman Al Saleh, the Director-General of Dubai Department of Finance said that part of financing Dubai World will be through the means of the sales of the asset as these are the company assets and not the government assets.

He said adding to it , “The motive behind restructuring of Dubai World is to ensure continuation of its operation as a viable commercial entity. The future of the company is most important than liquidity. It is in the company's interest to inject liquidity or restructure it, to ensure that it remains sustainable in the long-term.”
Al Saleh said that the Dubai World as well as the problem that of Nakheel, the developer of Palm Jumeirah and other real estate in Dubai, has originated from short-term lending on long-term projects, which doesn't generally work in a volatile market situation. Majority of Dubai World and Nakheel projects are long-term projects with strategic importance. These cannot be developed through short-term lending.
Al Saleh also said, “Dubai Financial Support Fund, established in July this year, can offer support to Dubai World, if needed.” He reiterated the government's stand on the state guarantee for Dubai World's debts.
Al-Saleh also pointed out that the legal documents signed at the time of company establishment do not carry any clause on the government's guarantee. The clauses clearly specify that the government will not guarantee the liabilities of the company.

Property Investors Can Be Protected from Aftermath of Crisis- New Real Estate Laws

A new law is being worked upon by The Real Estate Regulatory Agency in Dubai which will give new rights to property investors. The law has not been revealed but according to a spokesperson, it is going to be comprehensive and seek to protect the investors.

‘Along with the Dubai Land Department we are studying a new law to protect the rights of real estate investors. Our ultimate goal is ensure justice and set up proper rules and regulations to regulate the relationship between developers and investors,’ the spokesman said. He also added that a draft will be ready to be sent to the Executive Office in order to get the approval by the first quarter of 2010.

The new law is expected to recollect the confidence among the investors of the Emirate followed by the exposure that the owners of developers Nakheel, Dubai World, has huge debts of $59 billion and is attempting to restructure some of it.

It is expected that the real estate industry will welcome more transparencies further.

According to Jason Manolopoulos, managing partner of boutique investment firm Dromeus Capital, the current crisis has raised concerns over corporate governance and transparency to a much higher level.

‘Investors should have been wary about the fundamentals of Nakheel. Everyone was fully aware of the overcapacity on Dubai real estate

I think 2009 will be remembered as the year when the idea that an implicit guarantee should be priced only slightly wider than an explicit guarantee was relegated to history,’ he explained.

‘Investors will have to differentiate, and the selling of companies on the basis of their connections and strategic importance will no longer work,’ he added.

‘It's clear there will be job cuts but it's too early to know the extent of it,’ Raj Madha, an analyst at regional investment bank EFG-Hermes said.

Distribution of Commercial Space Initiated in Jumeirah by Al Fajer

A Dubai-based developer Al Fajer Properties has initiated the distribution of two million square feet of commercial area across its tower in Jumeirah Lake Towers.

The president of Al Fajer, Sheikh Maktoum bin Hasher Al Maktoum told, “We have already started handing over units in our five Jumeirah Business Centre towers. The second phase, consisting of another four towers, will be completed by the year 2011.The company has self-financed about 88 per cent of its towers.”

Through a discount scheme which was offered to investors in July, the developer raised up to Dh400 million. According to him, “It was very successful as we offered up to 40 per cent of discount to investors. We have used the fund to complete our construction.”He also added, “The Company may witness a default rate of 20 to 30 per cent, he said, adding, "we are OK with it as we have secured funding to complete our projects".

Leasing could be one of the possible options when Al Fajer still has 25-30% unsold inventory.

Asked whether "off plan" market could see a revival, Sheikh Maktoum said: "The off plan market is dead and will not see any revival."

"The market conditions were not conducive by end of March and so companies had temporarily halted construction. But those projects will get completed."

He believes that completed properties will be in big demand next year and so the focus is on completing all the launched projects.

Sheikh Maktoum said sales prices of Jumeirah Business Centre towers in the secondary market have risen by almost 30 to 40 per cent in the last few months.

"During the peak of 2007 and early 2008, prices had touched Dh2, 200 sq ft, but then fell to a low of Dh800 during the economic crisis," said Sheikh Maktoum.

Recovery of Off-plan Ventures Unlikely for Two Years.

The developers in Dubai need to think over quality and winning back investors smashed confidence in order to recover the off-plan real estate Dubai market which is unlikely to pick up before 2011 even after this move. The investors who have been deferred by the cancellations or delays also need to be won by the developers with tying pricing strategies.

Sana Kapadia who is the Vice President of Equity Research at EFG-Hermes said, “Investors have been holding back payments because construction is not starting and developers can’t move forward because investors are not paying, that is the reality of the current situation. The recovery of the off-plan market in the United Arab Emirates will happen only from early 2011.”

However some also think that it might take longer. According to Chet Riley, Vice President of Real Estate Equities Research at Nomura International believes it will be early 2012.

‘The over supply of residential units in the property market needs to be absorbed in the next two to three years. It is unlikely that the off-plan recovery will happen before 2012,’ he said.

The new investors need to be won by the developers with far more than mere promises as their confidence is being highly smashed.

According to experts, the tie-ups with mortgage companies and banks may help to ensure optimum funding in place and finally avoid the present ferocious state. They also emphasize on working more strongly with regulatory authorities to ensure the interests of the investors and to build their confidence once again.

“Aspects such as construction-linked payment plan will help to alleviate the financial burden of holding real estate if the project is delayed beyond the proposed completion date,” said Jones.

Kapadia also revealed that the blame for fuelling the assumption and spinning that led to the downfall of the off plan market goes to the developers themselves.

“Developers must avoid the trap of speculative payment plans that is 2 to 5% initial deposit versus the bulk at completion.” He said.

Dubai Properties Chairman Arrested

The Chairman of Dubai Properties, the state-owned developer, has been arrested on suspicion of offensive financial dealings, as reported by news agency Bloomberg on Friday. According to Dubai Attorney General, Essam Essa al Humaidan, Hashim Al Dabal  was arrested ten days ago and is now being interrogated.

Humaidan added, “We are questioning him almost daily and Mr. Al Dabal indicated he is ready to answer questions without having a lawyer present. We’re still trying to determine the extent of Al Dabal’s misconduct. When the investigation is complete, all details will be announced.” Further adding to this, he also added, ”The investigation is being “conducted swiftly and, God willing, it will be concluded soon and Al Dabal will be allowed to meet with a lawyer as soon as he appoints one and his family is allowed to visit him.”

An investigation had begun last year, to determine the corruption in real estate companies, which benefited from heaving demand after foreigners were allowed to buy property for the first time. Consequently, many officials were arrested including Zack Shahin, former chief executive officer of the emirates’ second-biggest property developer, Deyaar Development, and Adel al-Shirawi, former CEO of mortgage lender Tamweel.

Al Dabal is being held at detention center. He can be held for 21 days after which he must appear before the judge.

Meanwhile, the acting chairman appointed by Dubai Holding is Ahmad bin Byat. Subsequently, the CEO of Dubai Properties LLC, Khalid Al Malik will report to bin Byat.

Emaar Properties, the builder of the world’s tallest buildings nearing completion in Dubai, is on the edge of combining with Dubai Holdings along with two other state-controlled competitors, Sama Dubai and Tatweer. The move is aimed at controlling the supply of new buildings in Dubai in the midst of the flood of homes which coerced the prices of Dubai 50 percent lower.

Leading Dubai Property Developer Gives Contract Worth Dhs8.5 Million For Champions Tower IV

Al Jassmy Contracting Co. LLC has been awarded by a contract worth Dhs8.5 million, for the construction of a 20 story residential building in Dubai Sports City. One of the leading Dubai property developer, Memon Investments has awarded this prestigious project to Al Jassmy Contracting Co. LLC. Champions Tower IV in Dubai Sports City is worth 450 million. Located in the hotspot of Dubai Sports City and the Memon Investments’ reputation, this residential property has already gained popularity. Champions Tower IV hosts units ranging from two bedroom, one bedroom and studio. The residents can relish the 21st century opulent lifestyle with state-of-the-art facilities offered here. Canal, garden and golf course views are an added advantage of this property.

Rizwan Shaikhani said: "In line with this goal, we have made it part of our strategy to partner with credible and trustworthy industry leaders to lend us their expertise and help us achieve the targets we have set for our projects. For ‘Champions Tower IV' we have assembled a formidable team of engineers and project managers who will be working hand in hand to provide our customers the quality and convenience we have committed to them."

It has been committed the completion of the project is targeted for 22 months. Before giving the main contract, the developer has got into the deal with Stromek Emirates Foundation for undertaking excavation and shoring. This contract is worth Dh1.8 million. Also, ETA Menco would install high speed elevators.