Dubai’s goal of 20 million tourists per year is getting closer to reality with each passing year. Simply put, this means more job creation, a growing population and increasing demand for quality real estate projects, says Rahail Aslam, Founder and CEO of Select Group, in an exclusive interview with Nusrat Khalil Jamali from The Gulf Today.
Excerpts from the interview:
Q: How do you see the real estate market and construction activities in Dubai?
A: The current macroeconomic environment has created several attractive investment opportunities in the real estate industry for investors who have the liquidity and execution capability to take advantage of these. We believe this is an opportunity for investors to take advantage of the attractive payment plans being offered by developers.
Q: Do you see a gap in demand and supply in current scenario?
A: Our confidence in UAE is unwavering. The effects of rising supply maybe be felt in the short-erm, however, Dubai’s economy continues to grow and matching supply demand is never an easy ask. The emirate’s goal of 20 million tourists per year is getting closer to reality with each passing year. Simply put, this means more job creation, a growing population and increasing demand for quality real estate.
A significant gap remains for mid-market housing. We have demonstrated our ability to cater to this market through our design-led ‘Studio One development’, the price point for which attracted significant investor and end user interest. However, we can also evidence the latent demand for luxury products through our recent projects, Jumeirah Living Marina Gate and The Residences at Marina Gate. The first two phases of the development are virtually sold out and sales remain strong for JLMG.
Q: With your new projects, nearing completion, will there be any easing in prices and rents?
A: Our long-term vision for UAE real estate remains positive and Dubai has carved out a permanent place for itself on the world map as the perfect hub for linking the East with the West. The progressive emirate’s economy is bolstered by its tourism, trade and services industries which continue to grow year on year and we envisage the market’s cycle picking pace in the near future.
Q: What do you say about occupancy rate in you earlier completed projects?
A: Since inception in 2002, Select Group has focused on delivering premium developments to our dedicated customer base. The response to our 14 developments in Dubai Marina has been strong and our customer base has remained loyal and grown steadily over the years. All our developments enjoy strong occupancy levels with most at over 95 per cent occupied status.
As for the group’s developments currently under construction, Marina Gate I is virtually sold out, Marina Gate II, Studio One and No.9 in Dubai Marina are all at over 90 per cent sold out status and Jumeirah Living Marina Gate which is being launched in phases sold all units in the first limited release. The next limited release of these units is expected in Q4,2018.
Q: Any special reason to choose posh areas for your projects? Why not other areas and emirates?
A: Select Group is the largest private developer in Dubai Marina and being present here gives us a competitive edge. The Marina has outperformed the wider market in terms of capital appreciation and rental yields. It offers a vibrant cosmopolitan lifestyle, has great accessibility and public transport options. Its proximity to the beach, restaurants and cafés adds to its lifestyle and once residents embrace this they are naturally reluctant to move to other communities.
Select Group has developed and delivered impressive projects in emirates other than Dubai. Pacific, Select Group’s stunning development on Al Marjan Island in Ras Al Khaimah was handed over last year. Spread over 2 million square feet with a GDV in excess of Dhs1 billion, the development features six waterfront developments.
We are always on the lookout for the right opportunities in all Emirates. Our investments team is tasked with identifying the right opportunities and should a suitable prospect come our way, we will continue developing in other Emirates.
Q: You prefer to sell your projects to investors in bulk or individual end users? Please give your comments keeping in view that investors re-sell their purchased apartments with heavy upward margin in their investment to earn profit which leads to rise in prices.
A: Our developments are designed for the end users and long term investors. These include owners/occupiers and long-term investors looking for a curated lifestyle, strong rental returns and capital appreciation. The high occupancy levels across all our developments are testament to the strong demand for our developments.
Our developments are premium luxury residential developments and the group does not engage in bulk sales.
Q: After current project, what is your next plan?
A: Our flagship development, The Residences at Marina Gate, continues to make impressive construction progress. Marina Gate I is complete and residents have begun moving in. The second tower, Marina Gate II is now topped out and cladding / finishing works are ongoing. The third and final tower within this development, Jumeirah Living Marina Gate is making impressive progress with construction on schedule. A total of 1,400 residential units are spread across this three-tower development.
No.9 is another of the group’s luxurious residential developments in Dubai Marina scheduled to be delivered in the coming year. This waterfront property is located on the promenade and offers stunning Marina views. The 34-floor tower will house 220 apartments and offer residents a wide array of world class amenities. Built up area of the project is approximately 500,000 square feet.
Spread over 31 floors and 400 residential units, Studio One is Select Group’s 14thproject in Dubai Marina. Serviced by best-in-class amenities, Studio One is located in the heart of the up and coming west-end of the Dubai Marina; and is also at an advanced stage of construction.
We have acquired a prime piece of land in another waterfront location. Extensive concept and design works are ongoing and launch of the project is anticipated by end 2018. More details will be disclosed closer to the launch.
Q: How your completed projects can be beneficial during the upcoming mega event – Expo 2020?
A: Expo 2020 is a compelling reason to invest in the Dubai real estate market. With an expected 25 million visitors, there is no doubt that it will serve as a magnet for investors.
UAE continues to solidify its global reputation with progressive policies and constant growth. With concrete plans in place by the government for infrastructure development, rapidly growing tourism & services and ever expanding trade, the population of the country is poised for significant increase. This will result in a growing demand for housing and developers will need to ensure supply matches demand. This will be an exciting opportunity for the GCC developers.
As market matures and investors grow more savvy, only those developers with a proven track record like Select Group will prosper.
Q: What is your message to investors, buyers, end users and other developers in order to contribute to the Dubai and the UAE economy?
A: Dubai real estate market has come a long way in the last decade. The government has established regulatory bodies to ensure corporate governance and investor protection. New laws and regulations are bench-marked against best practices from all over the world.
In light of this, my advice to potential investors is that Dubai is a lucrative investment proposition as long as they ensure credibility and track record of the developers. Other factors such as established master communities, and prime location will always result in safe investments which will yield healthy rental returns and capital appreciation.
Reconfirm buyer demographics
The buyer demographics have continued to evolve over the years. Since inception in 2002, Select Group has had an extensive and varied customer base. The developments sold prior to 2009 had a largely western customer base with the majority from UK and Europe followed by UAE, GCC and subcontinent.
Post 2009 saw a shift and UAE and Saudi Nationals followed by Subcontinent customers formed the majority of our customers. A significant number of our existing UK and Europe based customers have remained loyal to the brand and continue to invest in Select Group’s developments. More recently the Chinese customers are beginning to invest in our developments.
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