RAK Properties is targeting revenue of Dh400 million ($109m) in 2021 as the UAE’s property sector continues to recover from the coronavirus pandemic.
The developer, which made a net profit of Dh113.5m on revenue of Dh243.5m last year, aims to sell 300 units from two projects in Ras Al Khaimah – Marbella Villas and Bay Residence, its acting chief executive Mohammed Al Tair told The National in an interview.
It is offering various incentives to increase sales including flexible payment plans as well as a waiver on service charges.
“In 2021, we are going to have bigger sales than last year. We achieved Dh240m last year despite the pandemic and this year it will be Dh400m-plus,” Mr Al Tair said.
The developer behind the Dh10 billion Mina Al Arab master development reported a more than five-fold jump in net profit in the first quarter of 2021 to Dh64m as revenue trebled to Dh124.2m, compared with the same period last year.
Property prices in the UAE are expected to stabilise in 2021 as the economy recovers from a coronavirus pandemic-induced slowdown and government initiatives spur growth. Both sales and rental prices in Ras Al Khaimah were flat quarter-on-quarter for the first three months of the year, a report by property consultancy Asteco said last month.
Mr Al Tair said the property market is on track to recover as governments open up economies to boost growth.
“From the beginning of this year, we feel that real estate [market] is coming back on track again and we are optimistic ... this year will be more successful [than last year].”
New programmes such as visas for expatriate retirees and the expansion of the 10-year golden visa scheme to attract foreign professionals to the UAE are also expected to support the local real estate market.
The company plans to launch a new residential tower as part of its Bay Residence project in Mina Al Arab as well as the second phase of Marbella Villas to increase its pipeline of units for sale.
RAK Properties is also active in the hospitality sector and is developing two hotel projects at Mina Al Arab – an Intercontinental Hotel and Resort and an Anantara Mina Al Arab Hotel and Resort.
The Intercontinental Hotel is scheduled to open in the second half of this year, while the Anantara Mina Al Arab hotel will start operations in the third quarter of next year.
The company aims to build one or two more hotels in the next five years, which will involve a total investment of Dh1bn, Mr Al Tair said.
“RAK Properties is very keen to invest in [the] hospitality sector and the sector in Ras Al Khaimah emirate is very encouraging. We think it will have a very good future.”
Ras Al Khaimah – which boasts the world's longest zipline at Jebel Jais, 64km of coastline, adventure tourism offerings and heritage sites such as Al Jazirah Al Hamra – has traditionally been popular with UAE residents and visitors from CIS markets.
The emirate is targeting a 20 per cent annual increase in visitor numbers this year, driven by easing border restrictions in the second half of the year and robust domestic demand, its tourism development chief Raki Phillips told The National last month.
The emirate hosted 830,000 visitors in 2020, down from 1.1 million in 2019, according to official government data.
Rak Properties will finance new projects through a mix of debt and equity, Mr Al Tair said.
Thus far, the company has built properties in Ras Al Khaimah and Abu Dhabi, but the chief executive said it it is “always open for discussions" to build in other locations.
"We are real estate developers. Wherever there is business we have to be there,” he said.