Dubai Investments is bullish on the UAE’s property market and is pressing ahead with its international expansion to boost its portfolio this year, its vice chairman and chief executive said.
The Dubai-listed company, in which the emirate’s Investment Corporation of Dubai sovereign wealth fund holds an 11.54 per cent stake, completed two major projects in the UAE – a Dh3 billion ($816 million) mixed-use project in Mirdif and a Dh500m development in Fujairah.
It plans to start a Dh1bn project in Al Marjan Island in Ras Al Khaimah in the second quarter of this year, Khalid bin Kalban told The National.
“We are discussing with various financial institutions for the funding of the project,” Mr Bin Kalban said of the Ras Al Khaimah development.
“There will be a hotel of 300 rooms, 170 villas and 400 apartments and some retail units. We are hoping to complete the project in 30 months maximum.”
The UAE’s property market is recovering from the onset of the Covid-19 pandemic on the back of new government initiatives such as residency permits for those who have retired and remote workers in addition to the expansion of the 10-year golden visa.
Measures to contain the spread of the virus, such as vaccination, have also helped the property market to recover. Many foreigners have invested in property with the aim of settling in the Emirates.
“Property market so far is good, values have improved, rentals have stabilised and supply has been absorbed,” Mr Bin Kalban said. “Whatever steps the government has taken and companies have taken in slowing down the projects, it has helped to protect and stabilise the market.”
Residential property prices in Dubai rose 21 per cent in the first 10 months of 2021 to Dh1,235 per square foot in October, from Dh1,021 per square foot in January, according to a recent Knight Frank study.
Ultra-high-net-worth individuals, among others, are buying property in a big way to boost the market. In Abu Dhabi, prices rose 2.2 per cent in the year to August, according to a separate report by CBRE.
The company, which has interests in other sectors, including health care and education, sold Dh1bn worth of property last year and expects demand to continue this year.
“We are almost running out of inventory [and] that’s why we are building in Ras Al Khaimah,” Mr Bin Kalban said.
Dubai Investments also plans to expand outside the UAE. It signed an agreement to build a project similar to Dubai Investments Park, in the southern African nation of Angola. With a total area of 20 square kilometres, it will have land for residential usage, logistics and offices, Mr Bin Kalban said.
Dubai Investments Park is a mixed-use industrial, commercial and residential free zone occupying 2,300 hectares near Al Maktoum International Airport.
The site hosts thousands of companies serving a variety of sectors including oil and gas, construction and pharmaceuticals.
Mr Bin Kalban said the company is “positive” about profit and revenue in 2022 after a strong financial performance last year amid the UAE’s economic recovery.
"Whatever steps the government has taken in the last year or the year before has helped a great deal to improve the overall economic situation and is reflected in the results of most of the companies, including banks,” he said.
Dubai Investments reported a 78 per cent surge in its 2021 net profit to Dh619.4m as revenue during the period rose 28 per cent to Dh3.41bn.
The new corporate tax being introduced by the UAE government in 2023 will bring “stability to the revenue of the government and grow the economy in a faster way”, Mr Bin Kalban said.