New project launches in the UAE started to pick up in the first quarter after slowing down at the end of last year, according to a new report by property services company Asteco.
“This trend is somewhat surprising given prevailing oversupply concerns,” said John Stevens, managing director of Asteco.
New supply of apartments and villas is increasing with the delivery of about 6,700 residential units in Dubai and 3,600 properties in Abu Dhabi, Asteco said in its UAE Real Estate Report for the first quarter, released ahead of Cityscape Abu Dhabi later this week. The supply doubled because of previously delayed projects being handed over and the increased delivery of properties with extensive post-completion payment plans.
The delivery of commercial units in Dubai was "limited" but is expected to pick up with the upcoming release of more than 750,000 square feet of office space in Silicon Park, the report said. Office completions in Abu Dhabi included Al Jewn Tower in Danet Abu Dhabi.
Due to this new inventory coming into the market, rental rates and sales prices recorded further declines across the emirates, Asteco said.
Dubai rental rates dropped by 3 per cent for apartments, 3 per cent for villas and 2 per cent for offices over the last quarter, the report showed.
Sales prices declined by 2 per cent to 4 per cent during first quarter of 2019.
"Interest in off-plan projects as well as secondary properties was somewhat buoyant, aided by competitive, more affordable pricing and attractive payment plans," the report said.
In Abu Dhabi, apartment and villa rents decreased by 2 per cent and 1 per cent, respectively, on average in the first quarter of the year, and 9 per cent and 5 per cent over the year, Mr Stevens said.
Overall apartment rental rates in the Northern Emirates contracted by 3 per cent in the first quarter and 11 per cent year-on-year. High-end properties in Sharjah and Ajman proved to be the most resilient with marginal quarterly decreases of 1 per cent and 2 per cent.
Initiatives such as long-term visas for investors and certain professionals, combined with proposed 100 per cent ownership of companies outside free zones, increased federal and local budgets, stimulus packages, diversification strategies and reduced cost of doing business are all expected to increase investment and facilitate economic growth in the medium- to long-term, Asteco said.
"In the meantime, the real estate market is expected to come under further pressure until economic conditions improve."
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UAE megaprojects 2019: new developments in Abu Dhabi and Dubai
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Dubai Creek Harbour: This perfectly fits the term 'mega-project', as it's almost twice the size of Downtown Dubai. Its flagship district is Creek island Dubai and will be home to 33,000 residents. The centrepiece however is The Tower, which is slated to be even taller than Burj Khalifa to become the world's tallest. Renderings courtesy Emaar -
Dubai Creek Harbour under construction. Dubai Media Office -
Burj Jumeirah: This one really is something special. The oval shaped tower will stretch to 550m once completed in the heart of Dubai. The defining feature is the fingerprint of Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, which will adorn the base. -
The project is being developed by Dubai Holding and will include homes, office space and hotels. The first phase is due to be completed by 2023. Wam -
Sahel Al Emarat: The Emirates' very own Riviera was announced by developer Imkan last year. Located in Abu Dhabi’s Ghantoot nature reserve, close to the Dubai border, the first phase will feature 293 small, “ranch-like”, villas and is scheduled to be completed by 2021. The idea is for it to be a coastal retreat like The Hamptons in New York. Courtesy Maram El Hendy -
Dubai Harbour: This Meraas development, located beside Palm Jumeirah, will have a lighthouse, shops, restaurants, cafés, luxury residences and hotels. Meraas chairman Abdulla Al Habbai said it will build on Dubai's historic seafaring traditions. Pawan Singh / The National -
The marina will have 1,100 berths, including 180 for superyachts, plus an exclusive yacht club and a helipad. -
Jubail Island in Abu Dhabi is currently undeveloped, but a huge Dh5 billion project will see the construction of six villages and homes for up to 6,000 residents. The first parts of the development will be handed over by the first quarter of 2021 and the whole development finished by 2022. Pawan Singh / The National -
The World Islands: 300 luxurious islands modelled on the globe was conceived back in 2003 and was constructed by 2008 by Nakheel. Apart from the Lebanon island, little progress was made - but that appears to be changing. EPA -
In August 2018 developer Kleindienst Group announced the first country in its Heart of Europe project was ready to open a residence. The Sweden Beach Palace was priced at Dh100m and is joined by nine more palaces. Chris Whiteoak / The National -
The Guggenheim Abu Dhabi: Saadiyat Island is already home to the fantastic Louvre and there's plans for plenty more in the cultural quarter. Saif Ghobash, undersecretary at the Department of Culture and Tourism Abu Dhabi, recently confirmed that major projects such as the Guggenheim and Zayed National Museum were still in progress. Courtesy Guggenheim -
Dubai Arena: Considered a game-changer for the UAE music scene it allowed music acts to come to the Emirates during the summer and perform indoors in the 17,000-seat air-conditioned stadium. Built by Dubai-based developer Meraas, it is located in the City Walk district. Courtesy Dubai Media Office / Meraas -
Museum of the Future in Dubai: This could be the place to give technophobes a nudge. It will feature a research centre with labs and classrooms, as well as a space for visitors to experience coming technology. Visitors will use wearable devices for interactive experiences. Courtesy Wam -
The Dh500m museum was originally scheduled to open in 2017 but was later postponed until 2020. Antonie Robertson / The National -
Barakah Nuclear Power Plant in Al Dhafra, Abu Dhabi: Construction of the $25 billion plant began in 2011. It connected to the UAE power grid for the first time in 2020. Arun Girija / AFP -
Etihad Rail: Created in 2009, the first phase was operational by 2016 and carried sulphur, a by-product of the oil refineries at Habshan in the Western Region of Abu Dhabi, to the port at Ruwais for export. After a delay to phase two, it was confirmed late in 2018 that the network would be extended, stretching from the border of Saudi Arabia to Fujairah. Wam -
Stage two, when complete, will run for 605 kilometres from Ghuweifat to the Port of Fujairah and will take in Mussaffah in Abu Dhabi's industrial area and Jebel Ali and Khalifa ports. A contract for the first phase of stage two - Ruwais to Ghuweifat - was awarded in March. Courtesy Etihad Rail -
Hyperloop: Dubai to Abu Dhabi in less than 15 minutes? Yes please. Pictured is a station planned for Abu Dhabi by Hyperloop Transportation Technologies. What was once considered just part of sci-fi is now close to becoming a reality with the high-speed mode of transport which sees passengers propelled via a pod in a tube. -
Both Hyperloop TT and Virgin Hyperloop One are each planning to unveil versions of the technology in the UAE in time for Expo 2020. The proposed route would take in Al Ghadeer on the Dubai-Abu Dhabi border which would be a boon for the growing community there. Roy Cooper / The National -
Yas Island: It's all systems go on the island known for its entertainment destinations. Master developer Miral has Dh6.2bn worth of projects under construction including the 18,000-seat indoor Yas Bay Arena. Pictured is the West Yas housing development. Hamad Al Mansouri for Crown Prince Court - Abu Dhabi -
Yas South will have a new pier, the arena and waterfront promenade with residential complexes and restaurants. It will also be the new home of media and entertainment free zone twofour54. There's plans to open a SeaWorld Abu Dhabi in 2022. -
Midfield Terminal: Commuters heading between Dubai and Abu Dhabi will have witnessed progress of the huge new development at Abu Dhabi International Airport during the past few years. It has been in the phase of testing. Pawan Singh / The National -
Midfield Terminal will span 742,000 square metres, and will have a capacity of 45 million passengers a year when completed. Courtesy KPF -
Dubai Metro: The red line is being extended by 15km to serve millions of visitors to Expo 2020 Dubai. It will run from Nakheel Harbour and Tower Station and 80 per cent of the rail track is currently complete. Courtesy RTA -
Expo 2020 site: It was the date in everyone's diary - October 20, 2020, but has now shifted to 2021 amid the pandemic. It will be the first time the world fair has been hosted in the Middle East and it is shaping up to be an extraordinary occasion. The project is spread over more than 4 sq km in Dubai South and construction has been continuing apace since the UAE won staging rights in 2013. MOFAAIC -
Expo 2020 will feature 190 countries and is expected to attract more than 25 million visitors during its six-month run. Eighty per cent of the Expo-built structures on site will be retained as part of District 2020, an integrated community that will be a new destination in Dubai. -
Reem Island: The skyline on this popular location for expatriate dwellers in the capital continues to evolve. Aside from the new residential towers, it now has a Burjeel hospital and its first Adnoc petrol station. Victor Besa / The National -
One of the main developments on the island is Reem Mall. When completed it will feature 450 stores and various family entertainment attractions including Snow Park Abu Dhabi. As many as 14 tower cranes have been on site alongside 4,000 workers ahead of its scheduled 2020 completion date. Courtesy Al Farwaniya Property Developments
