Oct 14 2019
While Dubai’s property market continues to remain subdued amidst rising supply, there is still healthy demand for the “right property,” the Managing Director of Ellington Properties said.
“We see significant demand for the right property – and that is why we have a clear strategy to build and hand-over up to 1,000 residential units annually,” said Robert Booth in an email interview.
The Dubai-based developer, which describes itself as a design-led boutique firm, has so far launched over 10 projects and several others in the development pipeline totaling 2,000 residential units.
According to research firm CORE’S Dubai Market Update YTD 2019 report, the real estate market is suffering from oversupply, with around 16,500 residential units already been delivered year to date (YTD) and an additional 13,000 units expected to be delivered in the remainder of 2019.
But Ellington Properties is not worried as the developer addresses an industry white space, “where the focus is on the wellness of residents, by integrating both design and technology to create unbeatable value,” explained Booth.
Recently, the company had signed a 150 million UAE dirhams deal with brokerage firm Déjà Vu Real Estate to build a new residential tower in a central location in Dubai.
“In fact, there is a significant spike in interest for real estate in Dubai – and the UAE – by international investors, which is reflected in our sales too,” he claimed.
In addition to the fundamental factors such as Dubai’s central geographic location and the UAE’s standing as a global business and leisure hub, Booth said there are several additional drivers of growth.
“One is the preparation for Expo 2020 Dubai, which will catalyse the property sector. Two, the recent initiatives of the government, including the issuance of long-term visas for professionals and extension of visas for retirees investing in property, will further drive the market,” he said.
The key is to look at property as a long-term investment and not for short-term gains, the Ellington executive said.
However, ValuStart’s third-quarter report has revealed that the capital values of residential properties in Dubai have fallen by 31 percent since its peak in mid-2014. Most industry experts predict prices to continue to experience downward pressure even in 2020.
Booth agreed that it is a buyer’s market, but also pointed out that “it’s indeed a good time to invest in property”.
He said developers are not only offering attractive payment plans and flexible financing solutions for customers but are also looking at structuring their launches to streamline supply.
The boutique developer does not see the current market as a testing time. “We have recorded strong sales; our delivery pipeline is robust, and our focus is to continue to build homes that are centred on our brand ethos of design and technology,” said Booth.
Ellington Properties had already completed the handover of Belgravia and Somerset Mews, with this year seeing the handing over of Belgravia II and the topping out of Wilton Terraces and DT1 residential tower.
Additionally, it has completed a number of villas under its ‘The Ellington Collection’ at the Palm Jumeirah. “To date, we have completed three projects of 400 residential units, and estimate to complete five residential projects by the end of this year, featuring 527 residences,” he said.
The Ellington MD said they will continue to rely on word-of-mouth locally to sell more of their new projects and work on opening new international markets such as Saudi Arabia, the UK and parts of Africa.
“We have a clear strategy to expand our portfolio – not just in the region – but also to markets such as the UK and Canada. We also aim to grow our product line to include hotels and rental homes, and grow our rental portfolio,” he said.
He also pointed out that Chinese investors having a growing interest in Dubai’s property sector led by several factors including the UAE’s strategic role in the Belt and Road Initiative (BRI), and the visa-on-arrival facility for Chinese citizens.
“The number of Chinese visitors has increased – so has trade and business partnerships between the two nations. Official reports predict Chinese investments in the UAE’s real estate sector to surge in the coming months – and is set to grow by 70 per cent this year,” said Booth.
As part of its strategy to expand source markets, the company has signed a partnership with Beike, China’s leading open platform real estate listings portal, which will take its properties to potential investors in over 300 cities in the country.
The company also sees a significant growth opportunity among the millennials. “That is why we are looking at initiatives such as co-living and renting, which will gain more traction in the market in the coming months,” he concluded.
(Reporting by Syed Ameen Kader; Editing by Anoop Menon)
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