Aldar has completed the sale of a block of 202 flats on Abu Dhabi’s Reem Island to a joint venture between two Dubai-based investment companies.
The Abu Dhabi-listed developer said that it would use the cash from the sale of the 44,424 square metre B2 Tower in Marina Square to invest in new developments in the capital. The bulk sale, to the Dubai-based MAG Group and Fortune 5 Investments, is one of the first to take place in Abu Dhabi since the global financial crisis and marks growing demand for apartments as the workforce grows.
MAG said that the tower, also known as Marina One, was completed, alongside its sister tower Al Dura, during the financial crisis. It had sat empty for the past three years.
"The sale of the residential tower is part of our broader strategy of injecting capital into new developments and to diversify Aldar's customer base with institutional investors," said Mohammed Al Mubarak, the chief executive. "This is the first major acquisition by a Dubai-based investor in a number of years and demonstrates stronger investment ties between the two emirates."
Aldar shares yesterday rose 1.7 per cent to close at Dh4.08.
Tamer El Khayat, the operations manager at MAG Property Development, said that the joint venture planned to sell off the apartments as individual units with prices ranging from Dh1.7 million for a one-bedroom flat to Dh5.5 million for a four-bedroom apartment.
He said that it had already sold between 65 and 70 per cent of the flats in the tower at prices averaging about Dh1,350 per sq foot.
“For investment companies looking to make money by selling off individual flats in Abu Dhabi the numbers are stacking up at the moment,” said Ben Crompton, the managing partner of Crompton Partners Estate Agents.
“There is a lot more job stability at the moment. End users in Abu Dhabi, as well as investors, now have the comfort to go out and buy their homes, and so prices in the capital are creeping up.”
According to Asteco, apartment sale prices in Abu Dhabi rose 4 per cent in the three months to the end of June, equating to a 29 per cent increase compared with the same period a year earlier.
lbarnard@thenational.ae
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