Your experience in property development spans over 20 years; how have you seen the UAE market changing during this time?
The prominent theme in Dubai has been continuous improvement, and the leadership has been relentless with the implementation of yearly business incentives. The incredible framework of a leading global trading port, financial services, real estate, and technology has attracted different nationalities. Consequently, the visa and foreign investment process has become straightforward, resulting in increased businesses and population growth, in turn driving real estate demand. Also, after the initial pandemic lockdowns, Dubai’s stellar vaccine record and open economy saw foreigners relocating to Dubai to live and work here, creating a lot of demand for real estate which continues to date.
What are the characteristics of this new buyer profile?
These are ultra-high-net-worth individuals buying ultra-luxury homes. We are in fact seeing unprecedented transaction values for beachfront villas and apartment blocks (Palm Jumeirah is a good example).
The real estate market is maturing and cementing Dubai’s position as a top three branded residential market, as an incredible city without much competition.
What are your thoughts on the creation of free zones to ease foreign investment in the UAE?
Our position as a leading trading hub is attractive to foreign investors. Free zones enable us to be a global business player and incentivize investors by allowing for easy entry into the marketplace and full company ownership, and facilitating an easy visa process.
From Select Group’s diverse segments – residential, commercial, and hospitality – which presents the most opportunity for investment presently?
Residential development is our primary market, with around 4,000 homes under construction at this time. Our core geographical market is Dubai as we aim to capitalize on the increased demand by delivering more real estate per annum. I anticipate continued demand despite higher borrowing costs.
These higher mortgage costs are in fact what I see as the biggest challenge for investors, but the increased transaction values are mitigated by the very diverse offerings in the marketplace.
Your development portfolio spans the Middle East and Europe. Where are you currently present, and do you have plans for expansion?
First, we have multiple assets in Dubai, such as the Intercontinental and Jumeirah hotels, and the anticipated Six Senses Residences on The Palm. Second, in Europe, we have a passive investment in the new airport hotel in Frankfurt, and in the U.K. we have hotel partnerships with Melia, Radisson, and ACCOR. We want to build our hospitality portfolio over the next 10 years to comprise 20 hotels, and our current focus is on the Dubai market, since inflationary pressures in Europe and the U.K. have pivoted investors towards the UAE.
There is increased interest in smart buildings and integrated sustainable features all around the world. Are UAE buyers willing to pay for these features, and are developers keen on introducing them?
These features are not a key focus for buyers, but they are becoming more and more appealing for developers. Taking the Six Senses brand as an example, its differentiators are responsible design, green initiatives, and wellness programming. In a nutshell, they are making use of sensors in public areas, solar panels, as well as centralized smart building management systems to handle energy and water consumption, resulting in a lower service charge.
What objectives are you pursuing with priority in the coming two-three years?
Our immediate focus is to hand over the Peninsula and Six Senses Residences projects in a timely manner, and with attention on quality. Our intention is to provide a seamless handover experience and set up best-in-class management teams to run the estates. Instead of securing new business, our complete focus is on delivering on the construction and development promises to our customers.
Do you have a final message for investors that are eyeing the UAE real estate market?
For potential real estate investors, my advice would be to have a structured investment process in place - carry out due diligence, visit potential communities you like, and use external professional advice. With these in place they will be ready to capitalize on the generous opportunities that UAE offers at the moment.
