Dubai Real Times Dec 09

Dh 10

December 2009

OFFICIAL MAGAZINE OF REAL ESTATE REGULATORY AGENCY

Page 4

Page 27

Page 33

Developer data

Oversupply in retail space

Proving their mettle Opportunities to attract investments

RERA pulls the strings Taqyeem in London and Brussels

Tall towers and community plans

OFFICIAL MAGAZINE OF REAL ESTATE REGULATORY AGENCY

MANAGING EDITOR K Raveendran

ravi@sterlingp.ae

MANAGING DIRECTOR Sankaranarayanan

sankar@sterlingp.ae

GENERAL MANAGER Radhika Natu

radhika@sterlingp.ae

EDITOR

Linda Benbow

linda@sterlingp.ae

Contributing Editors

Ambily Vijaykumar Vanit Sethi Manju Ramanan

ambily@sterlingp.ae vanit@sterlingp.ae manju@sterlingp.ae

Designer

Ujwala Ranade

ujwala.art@gmail.com

Sales and Marketing Account Managers

Peter Macwan

peter@sterlingp.ae

Rashmi Pai

rashmi@sterlingp.ae

Accounts & Administration

Biju Varghese Circulation Supervisor

Ibrahim A. Hameed

Printing Asiatic Printing Press L.L.C., PB 3522, Ajman, UAE. Tel. 06 743 4221, www.asiaticpress.com, email: asiatic@eim.ae Distribution: Tawseel PB No 500666 Dubai, UAE. Tel: (+971 4) 342 1512 Sultanate of Oman: Al-Atta’a Distribution Est., Kuwait: The Kuwaiti Group for Publishing & Distribution Co.Bahrain: Al Hilal Corporation, Qatar: Dar Al-Thaqafah, Saudi Arabia: Saudi Distribution Company RERA neither takes responsibility nor accredits any studies, research or statistics that are not issued by it.

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Message from the CEO

Real pulse “The crisis is over” … “ the prices have bottomed out” … “the market is up by five per cent” … these are the variety of messages that investors are getting on the same day. We at RERA always welcome reports and statistics that reflect the market and educate investors, but what we do not accept is that all those analysts and RE specialists never say what is the source of their data and what is the methodology used to reach those findings and result.

There is a big difference between a study based on solid market data and a study that just reflects the views and opinions of a person who knows little about Dubai real estate fundamentals.

Most of what I see in the newspapers and on television are just personal views, findings or results of small data that does not represent a good percentage of the sector. What we need for our sector is more transparent reports that are based on solid data and academic professional approach. Until we reach this level of professionalism in our sector, let us enjoy the Land Department’s trusted information that is published daily and reflects the real trusted pulse. “ The future belongs to those who believe in the beauty of their dreams” E. Roosevelt

Eng. Marwan Bin Ghulaita

Sterling Publications FZ LLC Loft Office 2, G 01, Dubai Media City

P.O. Box 500595, Dubai, UAE. Tel. +971 4 3678061 + 971 4 367 2245, Fax +971 4 367 8613 Website: www.sterlingp.ae Email: info@sterlingp.ae Overseas offices: India: Anand Vardhan, DII/89, Pandara Road, New Delhi, 110003. Tel: 0091 1 26517981 Bahrain: Sunliz Publications W.L.L, PO BOX 2114, Manama, Kingdom of Bahrain. Tel: 00973 17276682

DUBAI REAL TIMES

C O N T E N T S

2

4 Cover Story RERA pulls the strings

6 Taqyeem Taqyeem in London and Brussels

8 Personality

9 Statistics

Female Power

Transactions in Dubai

10

MTA

Tenant and occupier sentiment Colliers’ house price index rises Opportunities to attract investments Civil projects in uAE still active

19

Comments

Infrastructure in need of constant development Customer Care A world without project failure Human resources Mergers could save the property sector Realty rebound Re sale heaven Oversupply in retail space Market stability

30

Community

Proving their mettle

32

Movers & Mergers

Boards and Directors

33

Under Construction

Almost there Tall towers and community plans

36

Handover

A schedule of handovers

37

Interior Design

Multi-functional call centre

38

Focus

Doings in Dubai

42

Environment

Desalination Green grass

46

Profile

A century of building experience

48

Legally Speaking

Questions & Answers

COVER STORY

RERA pulls the strings Developers issued legal notices to complete registration related documentation

By Ambily Vijaykumar

DUBAI REAL TIMES

I

4

n tune with its task to regulate the functioning of the real estate sector in Dubai, the Trust Accounts Section at RERA has accomplished an important task.

The task entailed putting together a composite data of verification of all the developers and their projects in Dubai and the documentations needed for the completion of the registration process with the Dubai Land Department.

The process that began on October 7 met the targeted deadline of November 11 and has successfully put together a comprehensive data for the use of not just the Land Department but also of the developers and account trustees (banks). All the information that has been compiled since the process

Essa Saeed Ahmed Al Mansoori

began is updated online.

Based on the study of this data (after sending several

communications), RERA has issued close to 600 legal notices to developers asking them to complete

all the documentary formalities needed for the completion of their registration process. Once the legal notices were issued, developers were given a time of ten working days to rectify the anomalies.

Asked about the reason behind the need for a step like this, Essa Saeed Ahmed Al Mansoori, Head of Trust Accounts Section at RERA said, “The main objective behind this process was to validate the developer database to be with high economy like update the files for the registered projects and give a unique identification number to the developers and these projects.�

The process did not stop with issuing these legal notices alone.

Guarantee account trustees (banks) were also given an intimation to

some of the cases where the missing documents were not that critical, we have initiated partial activation for them,” informs Essa Al Mansoori.

Partial activation entails the release of construction and consultant expenses.

The documentations that RERA is pressing from the developer’s side are:

•

Developer registration certificate issued by RERA, • Project registration certificate, • Trade license issued by the Dubai Economic Development Department, or a temporary development permission issued by the Dubai Land Department, • Title deed, • Plot registration certificate, • NOC from the master developer on the project design, • NOC from the project consultant, • Project financial statement audited by an external auditor, and • Payment plan lined with construction milestone Khawla Mohammad Ali, who has been handling the Registration Section at RERA elaborates on the nature of the missing documents, “Sometimes developers find it difficult to get NOCs from the master developer, or they have to shell out a lot of money. In some cases the application form is not stamped.

Many a times the trade license that has been submitted expired and had to be renewed.”

Since the completion of the task and issuing of the legal notices, RERA has received 336 responses.

“These cases are closed and we have already sent instructions for full activation of all these accounts. In

Ahmed Khaleid Ahmed Obeidat

The task of compiling this massive data has been achieved by an eight member team at the Trust Accounts Section. Al Mansoori says that he is grateful to his team for their dedication towards the task which

trustees have the wrong information.

Sometimes the name of the project is different; at times even the bank names are different. So that needs to be rectified,” says Al Mansoori.

RERA will be sharing this information with the banks to ensure continuity in the information on projects and developers.

Once that is done then RERA will go back to studying the financial and technical feasibility of the projects currently on in Dubai. At the moment the financial feasibility of about 550 projects, of the registered projects at the Land Department, have been done and close to 700 projects have been studied for their technical feasibility.

Al Mansoori says that of the 550 studied for their financial feasibility about 450 “are okay to go ahead with”. The remaining might either be cancelled or delayed as the case may be. RERA also revealed that out of all the developers registered with them about 70 per cent were financially equipped to go ahead with projects and complete their task at hand.

Khawla Mohammad Ali

has helped them meet the target.

This first step of approaching developers is only the beginning of the larger process. The next step will involve sharing the collected data with banks. “What we have observed is that even the account

RERA says that there is an increased need to establish a proper communication channel with developers so that there can be more transparency in the functioning of the real estate sector.

It is bearing this in mind that Al

Mansoori says that “a constitution” has been laid down for the formation of a Developers’ Committee at RERA. “Developers must register first.

We will choose a total of twenty developers who will be part of this committee. They will act as a consultancy supporting the regulations and the market and raising the need for improvement in it. The committee’s role as a consultant is aimed both for RERA and for the real estate market in general,” says Al Mansoori.

RERA does not plan to put in any strict criterion for choosing which developer forms part of the committee but they are promising to bring in a good mix of people.

The committee is expected to meet once a month and report to RERA’s CEO. RERA representatives might be part of these meetings.

This committee is expected to be formed in the first quarter of 2010.

The coming year is something that Al Mansoori is “very optimistic” about. He says that “the trust and confidence in the Dubai market is there and with support from financial institutions, they should be able to assist the market in bouncing back.

Another aspect that is being closely monitored are real estate prices, which are expected to take a dip further with the influx of inventory into the market with the completion of the projects. RERA is of the view that the reduction could affect the commercial sector and not the residential market since “there is a need for residential properties”.

Al Mansoori believes, in line with the rental index, the Dubai real estate market will benefit hugely from the introduction for a price index for properties. “That will not be damaging for the open market status of the emirate since it will only be proposing a range for the prices - and not a fixed one. Underlining the need for something like this to control the market, he says that since Dubai has been built on the trust of its investors it is imperative to safeguard it.

DUBAI REAL TIMES

freeze the accounts of the developers who have been issued these notices.

The freeze however did not result in any negative impact on the ongoing projects in terms of covering their construction costs.

“By freezing an account, we instructed the banks to only freeze costs on other project payment like land payment, consultant payment and similar. These payments are not allowed through the account until all documentations are in order.

The account is activated only once the missing documentation has been taken care of,” explains Ahmed Khaleid Ahmed Obeidat, Financial Controller, Trust Accounts Section.

5

TAQYEEM

Taqyeem in London and Brussels

By Mohamad Khodr Al-Dah, Head of Taqyeem (Real Estate Appraisal Centre)

T

he month of November 2009 has seen a lot of activity and jet-setting for us at Taqyeem (Real Estate Appraisal Centre). As part of our continued effort to be a vital and active part of the international valuation community, Mohamad AlDah went to London and Brussels to participate in various conferences and meet key professionals in the mature valuation environment of the United Kingdom and Belgium.

We believe that cooperation is a two-way street, and as much as we benefit from seeing how things are done in other countries, we hope that there is benefit for others to learn about the Dubai experience with regards to regulating the property valuation profession. On all fronts, the visits were successful with key contacts made across many key players in valuation in Europe.

The following gives a small flavour of the key activities.

1- LONDON, United Kingdom This was the first stop. London is one of Europe’s finest cities; and perhaps one of the most important capital cities in the Western world. A city that needs no introduction. Taqyeem

was fortunate be involved in various activities as detailed below.

1.1 RICS International Valuation Conference RICS hosted an excellent conference

on 10 November 2009 on the subject of International Valuation at the Royal Society of Medicine a short walk from the bustling and famous Oxford Street. The conference was chaired by a very knowledgeable RICS Present Elect, Robert Peto MA FRICS who is also Vice Chairman of Capital Markets at DTZ. Mr Peto has extensive experience in valuation and ran DTZ’s Middle Eastern office.

Various excellent presentations were given not only from valuers but from bankers, engineers, architects, fund managers, academics and many others. Key speakers included: • Andrew Haldane, Executive

• •

DUBAI REAL TIMES

On the roof terrace of RICS headquarters in London

6

• • •

Director, Financial Stability, Bank of England. Mr Haldane gave us an insight from the viewpoint of the Bank of England, one of the oldest central banks in the world.

Mr Denis Turner, Chief Economist, HSBC, gave a very entertaining presentation about the state of the British and world economies.

Dr Ian Cullen, Founding Director, IPD. Dr Cullen is an economist with extensive experience in investment and property indices. www.ipd.com<http://www.ipd. com> is the website of choice for many people seeking accurate information regarding properties, investment or the economy.

Ian Mason, Fund Manager, Schroder Exempt Property Unit Trust.

Martin Bruehl, Managing Partner, Cushman & Wakefield Germany.

Prof. Sarah Sayce, Head of the School of Surveying & Planning, Kingston University. Prof. Sayce gave a very engaging talk about various aspects involving

valuation and sustainability and how buildings become obsolete with time. It was refreshing for the conference to receive a bit of academic rigour!

1.2 Visit to RICS HQ RICS was very kind to open its doors to Taqyeem, and Mohamad Al-Dah was able to meet many key players at the organisation that is at the forefront of excellence in land, property and construction. The President, Max Crofts and the Chief Executive Louis Armstrong gave a very warm welcome. Al-Dah also met John Anderson, RICS Associate Director, to talk about the UAE version of the Code of Measurement Practice which Taqyeem is hoping to introduce in Dubai soon. For more information visit www.rics.org 1.3 Meeting the IRRV (Institute of Revenues Rating and Valuation) The IRRV is a very well respected UK-based Institute that specialises in Valuation and Rating (land taxation).

Taqyeem was introduced to David Magor, IRRV Chief Executive and Gary Watson, IRRV Deputy Chief Executive. RERA and Taqyeem hope to cooperate with the IRRV via the pages of Dubai Real Times to keep you in touch with best practices from the valuation world. Interestingly, during Mohamad Al-Dah’s studies at the University of Oxford, David Magor was one of the senior figures in Oxford City Council, however they never met in Oxford, instead they met more than a decade later through valuation. The Oxford City Council is a body similar to Dubai Municipality. For more information visit: www.irrv.net 1.4 Visiting the Valuation Office Agency Taqyeem was able to visit the Valuation Office Agency (VOA) and

1.5 Meeting the renowned author Eric Shapiro It was a pleasure to meet the very

professional capital, then Brussels has to be Europe’s political capital.

Brussels houses the European Commission and various European Union organisations as well as being the capital of Belgium, a country that thrives on ethnic diversity and is home to two main ethnic groups as well as many more. French and Flemish are both official languages in Brussels.

TEGoVA (The European Group of Valuers’ Associations) Conference and Membership TEGoVA is a prestigious European non-profit making association composed of 42 valuers’

(right) Valuer, academic and author Eric Shapiro FRICS IRRV FCIArb

experienced valuer, academic and author Eric Shapiro FRICS IRRV FCIArb. We exchanged views on the similarities between the property markets in the UAE and the UK and spoke about general matters relating to valuation. We also spoke about Mr Shapiro’s newest book on valuation. In addition to writing books, Mr Shapiro works at Chesterton Humberts office in Swiss Cottage in North London.

For more information visit: www. chestertonhumberts.com

2- BRUSSELS, Belgium After an action-packed week in London meeting some of the brightest minds in valuation, Mohamad Al-Dah packed his bag and headed for the 45 minute flight from London to Brussels. If London is Europe’s financial and

After a presentation by the Head of Taqyeem to the TEGoVA General Assembly, Taqyeem was voted in as an Associate Member of TEGoVA

associations from 25 countries representing about 120,000 valuers in Europe. TEGoVA works on excellence on standards, ethics and quality in the real estate valuation market.

The weekend of 13 and 14 November 2009 witnessed TEGoVA’s General Assembly.

In pursuit of excellence and in keeping with international best practices, the Land Department and RERA through Taqyeem have applied for membership of TEGoVA. Taqyeem applied formally to apply to TEGoVA in the summer of 2009 and was invited to this General

Assembly to present its candidature.

After a presentation by the Head of Taqyeem to the TEGoVA General Assembly (which includes the Board of Directors), Taqyeem was voted in as an Associate Member of TEGoVA, which is something that Dubai and the United Arab Emirates should be proud of, especially as the Land Department approaches its 50th birthday and the federation of the United Arab Emirates celebrates 38 years on the 2 December 2009.

The Belgian weekend was full of valuation-related goodies such as the following topics: • European Valuation Standards (EVS) • Recognised European Valuer (REV) scheme • Sustainability and Energy Performance Certificates (EPC) The meeting was attended by various TEGoVA officials such as Roger Messenger FRICS IRRV TEGoVA Chairman, Chris Grzesik FRICS REV Member of the Board, François Isnard Managing Agent, Michael MacBrien, Gabriela Cuper, as well as many others.

Various bodies represented at TEGoVA hailed from countries such as Austria, Czech Republic, Denmark, France, Germany, Greece, Hungary, Ireland, Italy, Norway, Poland, Romania, Russian Federation, Spain, United Kingdom, and now, the United Arab Emirates.

Watch this space for further announcements on initiatives under the TEGoVA banner.

DUBAI REAL TIMES

IRRV through the kind introduction

by Chris Grzesik, FRICS REV. The VOA is an executive agency of HM Revenue & Customs (HMRC). We were able to compare valuation practices in the public sector between the UAE and the UK. The VOA employs around 4,000 staff around the UK. We met key figures including Graham Stalker, Patrick Bond, and Ronald Johnson. For more information visit: www.voa. gov.uk

7

PERSONALITY

Female power Shamma Al Kaabi says she loves her role at RERA since it gives her the power to give back to society

By Amal Abdul Rahim Al Sahlawi

DUBAI REAL TIMES

T

8

he presence of female staff at any organisation is an addition to the creative aspect of the organisation - and RERA is no exception. What a female staffer also brings to work is the human touch in dealing with not just her work but also the people who come to seek assistance. The Real Estate Regulator Agency encounters many such people who need to be guided and, on many occasions, hand-held to help find solutions to their problems. Shamma Al Kaabi has been one of the torch bearers for the Agencyâ&#x20AC;&#x2122;s vision to see a larger role for women in the decision making and executing activities. She has been with RERA since 2008 and has been climbing up the ladder of learning under the able guidance of the CEO. Her desire to not only attain professional satisfaction, but also participate in the service of the community by giving investors and clients

who come looking for answers at RERA a clear and concise picture, has helped her find a firm footing in the Agency.

She began her career in 2005 with the Department of Tourism and Commerce Marketing (DTCM) and worked with their customer service department till 2008. The stint gave her the expertise and confidence to deal with different clients and also gave her an edge over others. Her work at the office of the Executive Director entails receiving complaints and giving suggestions to resolve them. She is entrusted with the responsibility of coordinating with various departments at RERA to find solutions to the various complaints.

Her role is demanding since she not only has to give a patient hearing to those who come to RERA for redressal, but she also has to keep a track of the latest developments in the real estate sector to be better equipped to guide people.

Apart from RERA, where Shamma finds challenge and inspiration at the same time, she is deeply impressed by Sheikh Mohammed bin Rashid al Maktoumâ&#x20AC;&#x2122;s wisdom and outstanding leadership that has helped create a much respected global image for Dubai.

She says that it is the duty of every employee to keep that vision in mind while executing their work.

Shamma says it is thanks to that vision that Dubai has been able to race ahead in all sectors and also offer its investors and its residentsâ&#x20AC;&#x2122; security and satisfaction.

On a personal front, she says that her inability to complete her graduation is the biggest stumbling block in her career. But she is determined to overcome that. In her determination she finds complete backing from her husband and her brother who give her constant guidance on what is to be done and how she needs to approach each day and

challenge.

Her parents are also by her side offering her the best of advice in fulfilling her dreams. They have instilled in her a deep admiration and love for her homeland, the UAE, and that reflects in her dedication at work.

Outside work, Shamma loves spending time with family and visiting friends. She finds great solace among children with whom she spends a lot of time doing fun-filled activities. She is also an internet buff and ensures that she keeps herself updated not just on the latest happenings around the world, but she also surfs for information that would help add to the knowledge base of children.

Her goals include completing her graduation programme and she wishes to set an example for others to follow. She believes that education is the key to success and it comes in handy at all times in life.

STATISTICS

Land transactions in Dubai top Dh1.48 billion

T

he total value of land transactions in Dubai in mid November peaked at Dh1.48 billion, of which sales exceeded Dh996.78 million. The total value of mortgages during the period was Dh486.63 millions million, according to the Land Department.

A total of 66 sale transactions were registered with the Department by the end of the week, the most valuable of which was a plot in Dubai Industrial City First that was sold for Dh17.263159 million.

The next two most prominent sales saw a second plot in Dubai Industrial City First acquired for the sum of Dhs13.295248 million and another in Dubai Sports City for Dh13.18625 million The Arabian Ranches area was the most active in terms of the week’s sales, with some 14 transactions. Dubai Industrial City First followed it with seven sales.

During the period, Dubai Industrial City First recorded the highest turnover by value, at Dh72.58 million,

Arabian Ranches

followed by the Arabian Ranches area, Dh40.58 million, and Dubai Sports City area, Dh30.13 million.

The biggest area sold was the 191038.14 square feet in the Dubai Industrial City First area, which went for Dh13.3 million. A 68314 square feet plot in the Dubai Industrial City First Area was acquired for Dh8.05 million, while 68091 square feet of Dubai Industrial City First was disposed of for Dh9.81 million.

During the period under review 84 mortgages worth Dh169.58

million were registered, the most significant of which as the Dh21.24 million for an area at Al Warsan First.

There was another for Dh21 million on an area in Jebel Ali. Apartments and villas in freehold areas witnessed the registration of 485 sales transaction out of which 441 were for apartments for a total of Dh404.18 million and 44 for villas at a total sum of Dh69.99 million.

A total of 72 mortgages for Dh109.59 million were registered on villas and apartments.

Wadi Walk at Dubai Sports City

Land sales transaction • Total number of sales transactions within the districts was 256 with a total value of transactions at Dh2,188 million for 3,572 thousand square feet

• Emirates Hills 3rd had the highest number of sales transactions with 32 sales • The highest value of sales was achieved by Palm Jumeirah with Dh317 million

Flat sales transactions • Total number of sales transactions within the districts was 1,357 with a total value of Dh1,307 million for 1,469 thousand square feet • Warsan First had the highest

number of sales with 316 sale transactions • The highest value of sales was achieved by Dubai Marina district with Dh357million

DUBAI REAL TIMES

Total transactions for the month of October was Dh9,510 million

9

MARKET TRENDS & ANALYSIS

Tenant and occupier sentiment at tipping point

10

long-term investors to commercial markets in the MENA region. The company expects strengthening tenant and occupier demand to convert into increased investor demand later in 2010 - which is shaping up to be the ‘vintage year’ in the current real estate market cycle.

Looking beyond paralysis Commercial leasing markets across MENA have been depressed for the past 16 months as a direct consequence of the global and regional economic downturn, which significantly reduced demand for office space across all sectors of the economy from mid-2008. As a result of declining revenues and headcounts, most major occupiers have reviewed their approach to real estate, which has resulted in: • Delays in making decisions in the light of unclear business conditions with many firms placing their previous expansion strategies on hold resulting in a period of inactivity.

• Moves to offload surplus space.

This has resulted in the development of a market in sub lease or ‘grey’ space in many markets • Attempts to reduce real estate costs by renegotiating current leases with landlords This trend is certainly not unique to the MENA region with markets globally seeing little new demand over the first half of 2009. Combined with the significant levels of new supply coming online, this has led to most markets across EMEA moving in the favour of tenants and occupi-

ers as vacancy rates have increased and rentals declined.

With the development pipeline not capable of reacting to falling demand immediately, increased supply has led to rising vacancies across the MENA region, with all the major markets positioned in the downturn stage of their rental cycle in Q3 2009.

Rebound in tenant and occupier sentiment Tenants and occupiers are now beginning to awake from this period of inactivity, with improved sentiment reflecting a consensus that the worst of the downturn has past and now is the time to be repositioning themselves to benefit from the forthcoming recovery.

There are two major factors driving this improved sentiment: • Improvement in business confidence as economies across the region move onto a more positive footing. Strong performance indicators such as oil prices and

equity markets have led to positive revisions in forecasts of economic activity. In the latest such revision, the IMF has increased its 2010 economic growth forecast for the Middle East region to +4.2 per cent, a 0.5 per cent forecast increase from its July estimate.

• Rentals have fallen significantly in some MENA cities (most notably Dubai) as markets have moved increasingly in tenants and occupiers favour, resulting in competitively priced office space being available. Dubai’s position as MENA’s most competitive market is reinforced by the significant reduction in rentals as well as continued confidence in the cities long-term prospects.

Ten-fold increase over last six months The improvement in occupier sentiment is being reflected in an increase in the level of active and potential tenant demand in the marketplace.

Tenent & Occupier Enquiry Index (Dubai)

Square feet

DUBAI REAL TIMES

T

enant and occupier sentiment has now reached a tipping point and has improved noticeably in the region over the past six months, says a recent House View publication

by Jones Lang LaSalle (JLL)). Tenants and occupiers have recognised that favourable market conditions provide them with opportunities to take advantage of the new, competitive nature of the market.

Improved tenant and occupier sentiment has been reflected by a ten-fold increase in the level of active and potential demand in Dubai over the past six months. Though improved sentiment has yet to result in a significant increase in signed leasing activity, JLL expects this to occur within the next 6 – 12 months.

Recovery in demand will be uneven rather than uniform, with clear winners and losers in an increasingly forward-looking market focussed on location and quality. Despite increasing vacancy rates, a shortage of such stock is likely to remain.

Proactive owners will recognise the need to cater more closely to tenant and occupier demands. The strategies likely to be recommended are rent free periods and other leasing incentives, along with the provision of longer leases for major anchor tenants and occupiers. Some of the more innovative landlords may also offer finance packages to assist with the initial capital expenditure required for fit-outs.

An improvement in demand is a necessary prerequisite to attract

1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0

Oct '08

April '09

Oct '09

Increased leasing activity (over next 6 – 12 months) In the worst affected markets, rents have adjusted to the level where tenants and occupiers are prepared to take a risk on a further decline, particularly for well specified products in prime locations where some selective shortages are now occurring. This is allowing tenants and occupiers the opportunity to trade up to better quality space while still achieving a cash neutral position.

Many tenants and occupiers are seeking to take advantage of the availability of fitted out space to reduce their relocation costs.

Others are merging operations from multiple locations into a single, better quality facility at a similar or lower rent than they were previously paying.

There is clearly a ‘lag’ period between improving sentiment and actual market activity i.e. deals done.

There is, however, clear evidence that the weight of transactions has increased over Q3 and we foresee a continuation of this trend moving forward.

It is clear that a significant component of corporate demand in the MENA region will continue to come from large multi-national businesses. With almost all the Fortune Top 500 companies now represented in the region, most of the growth from this sector will come from the expansion of existing occupiers rather than new entrants to the market. Jones Lang LaSalle research indicates 75 per

cent of this group of major overseas multinationals currently have representation in the region.

Another sector of the market that has been somewhat overlooked in the MENA region in the past is small and medium sized businesses (SMEs). Although multinational companies (MNCs) may have the largest employment on a per company basis – employing upwards of 300+ employees, the number of SMEs that employ 20-100 people creates an overall larger employment base. In planning for the global economic recovery, governments across MENA are recognising the importance of creating an environment within which these companies can flourish and develop.

This will be one of the most important factors to increase employment and therefore occupancies in office markets across the region.

Office markets in MENA have been defined by low vacancy rates and a shortage of good quality space. The next few years are likely to witness an increase in both the quality and quantity of space being offered to occupiers, with the development of multiple sub-markets

and new office formats including mid to low-rise business parks in addition to high-rise CBD space.

The pattern of tenant demand

er clients on how to take advantage of the current market conditions is summarised in the following table.

The following table summarises changes in a series of Leading Trends leading inu Shift from larger to smaller deals (less then 10,000sqft) dicators of real estate u Shift from investors to tenants and occupiers market conu Shift from pre-lets to existing buildings ditions in u Shift from modest to highest quality buildings Dubai. This u Shift from short to longer term leases data will be updated on a monthly has also changed and is likely to basis and will be reported in future continue to evolve as markets ma- editions of this publication. ture. Leading trends over the next year will include the following: Looking Ahead Call to action for owners, With investors increasingly focused on assets offering secure long term tenants and occupiers income streams, tenant demand While landlords are not in a position is a good leading indicator of poto stimulate additional occupier tential investor demand, with imdemand at the level of the whole proved tenant demand preceding market – they can certainly influ- increased investment activity by ence the pattern of demand within 6 – 12 months. Look out for those any particular market. Owners can markets with the greatest improveproactively attract tenants in the in- ment in tenant demand, as these creasingly competitive market con- are likely to be those cities to subsequently attract the greatest investor ditions by providing incentives.

JLL’s advice to owner and occupi- demand.

Advice to Owners

Advice to Tenents and Occupiers

u Rent free periods

u Flight to better quality space on a "cost neutral"

u Tenant improvements / fit out

basis

u Additional incentives / amenities (parking, gym, memberships, etc)

u Consolidation of multiple sites into single tenancies

u Flexible payment schedules

u Ability to look into longer term leases with flexibility

u Reviewing and improving management maintenance practices

u Opportunities to acquire fully fitted space to

u Professional leasing team (attentive to tenants needs)

Indicator

minimise up front capital costs of moving

Current Month

Previous Month

Change

$79.61

$70.79

p

EIBOR(%) - 18/10/09

2.47

2.63

q

EUR : USD - 18/10/09

1.49

1.47

p

DFM Real Estate Index

4,606

4,053

p

Value of registered property transactions (M-o-M) Change)

-41%

9%

Number of registered property transactions (M-o-M Change)

-49%

-9%

Value of construction tenders (existing and new) (millions)

$59,300

$42,700

p

Value of projects cancelled / on hold (millions)

$4,460

$5,600

q

Occupancy (Dubai - All Hotels)

67%

68%

q

Revenue per Available Room (Dubai - All Hotels)

$103

$109

q

Economic Indicator Oil Price (Brent Crude) - 18/10/09

Real Estate Market Indicators

Hotel & Tourism Indicators

DUBAI REAL TIMES

Research shows that active and potential demand in Dubai alone now stands at over 1.5 million square feet.

This has increased ten-fold since April 2009 and now stands around three times the level of active demand in the Dubai market one year ago (October 2008).

Much of this demand is for immediately available space, preferably with a previous tenant fitout in place, making a relocation cost-neutral. The majority of demand is for units of less than 20,000 square feet, although there remain some active enquiries for much larger areas.

11

MARKET TRENDS & ANALYSIS

Colliers’ house price index rises

Q3 bounce this year puts prices at same level as Q2 of 2007

C

indicate a bounce in the market but of each development in the coming we will have to wait for the Q4 re- months.” sults before we can say whether an underlying growth Burj Dubai Boulevard at Downtown Dubai profile exists, indicating a potential recovery.”

Looking ahead to 2010, Colliers predicts that the volume of new units expected to come onto the market will suppress average prices. However, Colliers stresses

olliers International, the global real estate consultancy, recently released its Dubai House Price Index for Q3 2009, which indicates a seven per cent increase in the overall value of residential properties between July and September 2009.

The Index, compiled using mortgage transaction data from financial institutions, also demonstrates a 47 per cent year-on-year decline between Q3 2008 and Q3 2009. The report shows that at the end of Q3 2009, property prices in Dubai had Ian Albert

DUBAI REAL TIMES

OVERALL MONTHLY INDEX (WEIGHTED)

12

returned to approximately the same level as those recorded in Q2 2007.

The volume of market transactions increased by 64 per cent during Q3 2009 compared to the previous quarter.

Colliers’ analysis of the results indicates that the increase in the value of the Index is due to a number of interrelated factors. The increased availability of finance and a softening of loan-to-value ratios eased the liquidity concerns of purchasers.

Supporting this demand is a perception of improved expatriate job security, excluding the real estate sector. In addition, the ability for purchasers to monitor the actual prog-

ress of developments has allowed for greater transparency regarding progress and afforded them greater certainty when it comes to making a purchasing decision.

Ian Albert, Regional Director, Colliers International, said: “This latest HPI has now recorded the first price increase since the market fell.

We believe that figures in the HPI Q3 2009 have clearly demonstrated a crystallisation of the property market in Dubai between ‘oases of performance’, or tier one developments, and tier two and other developments.”

Commenting on future expectations, Albert added: “The Q3 results

that price suppression will not be uniform across developments. Certain tier one developments will offer investors oases of performance, predicated upon a return to fundamentals outlook.

“Well planned mature developments in good locations, supported by facilities and community infrastructure will receive relatively higher demand. This demand ensures a lower risk profile for banks, which ensures the availability of finance to support demand further,” said Albert. “The dynamic between consumer demand and the banks’ risk profile for lending will be fundamental to driving the price direction

Key findings: • Increase in the overall index of 7% between Q2 2009 and Q3 2009 • YOY decline of 47% between Q3 2008 and Q3 2009 • Blended average rate for residential property in Q3 2009 up from Dh949/ft2 (Dh 10,215/m2) in Q2 2009 to Dh1,016/ft2 (Dh10,936/m2) • Apartment prices increased by 6% in Q3 2009 compared to Q2 2009 • Villa prices increased by 9% in Q3 2009 compared to Q2 2009 • Townhouse prices increased by 7% in Q3 2009 compared to Q2 2009 • The number of transactions increased 64% in Q3 2009 compared to Q2 2009

Opportunities to offload assets and attract investments are real

T

he last couple of months have made it clear that there is a need to attract fresh capital to Dubai in order to invest in productive activities, create jobs and attract expatriates. Using existing real estate assets could be one of the keys. Due to oversupply in most residential, commercial, retail and hospitality segments, there is little chance for a significant price increase in the short- to mid-term, so owners should not rely on this as an exit strategy and hold on to their assets, as they might be waiting for a long time.

When access to cash is constrained in downturn times and when the time is right to invest in new business opportunities, or to support the attraction of FDI, it makes sense for public or private bodies to turn parts of their noncore real estate assets into liquidity. It is better to create value in the productive economy rather than keeping assets with limited value creation potential in the short-and mid-term balance sheets.

Right now, there is a need for large real estate owners to refocus investment on their core activities, a need to structure long-term real estate investment vehicles in the region and an appetite from regional investors. There is a window of opportunity for funds, operated by managers with a good understanding of the local market, to develop transparent governance practices and acquire and manage assets offloaded by large real estate owners.

This would allow government entities and large family groups to refocus on their strategic plans and core business and invest in job creating

activities. Some of the transactions could be in the form of sale-leaseback schemes, which are common for large corporations in mature markets. In this type of financial transaction, an asset owner using the asset for its business, sells the asset to an investor and leases it back on the long-term, and continues to use it. The objective is to unlock the value of properties while ensuring stable returns to the investor.

These are good types of transactions for funds and REITs with longterm investment horizons, when they are structured with large, public or private tenants. The advantage for the seller is that the scheme helps finance its expansion or investment into new business opportunities, while improving the balance sheet.

The advantage for the buyer is a low-risk fair-return on investment on an asset occupied by a reliable tenant with a long-term guaranteed stream of income.

Asset-free strategies are com-

mon in the hospitality and retail segments, where numerous operators decided to free up cash and fuel their growth strategy. Like many of its competitors, the leading hospitality group Accor has raised more than $3 billion in cash over the past years by offloading a significant part of its hotel physical assets to private equity funds. Carrefour, the retailer giant, has also offloaded several billions of assets to asset management funds and floated a specific subsidiary owning its real estate assets on the stock market.

Currently, the attraction of international investors into the GCC real estate market is very limited. Property Funds Research Database shows that in April 2009, only 21 funds targeted the GCC with no more than 0.2 per cent ($3 billion) of the Total Gross Asset Value invested by funds globally ($1,648 billion). This is almost insignificant compared to the existing base of assets already delivered to the market and the $1,500 billion + projects currently active or planned in the GCC (Markaz Analysis 2009).

There are several limitation factors for international real estate investors to massively invest in the region in the short-term, such as lack of unified legislations in the GCC. Other barriers to entry might include: limitations to language or cultural understanding, the perception that regionally, asset ownership issues for non-GCC companies lack

transparency in governance rules as well the existence of attractive opportunities for international investors in their home markets. That’s why the current situation provides a window of opportunity to create regional funds and the opportunity to set up high-standard transparency rules in asset management, which in turn supports the professionalisation of the property management and real estate services business. Regional investors would gain access to structured, long-term and risk-limited investment vehicles which are currently almost non-existing. Governments and local family groups would be able to raise cash to develop the economy at a moment when it is most needed.

Dubai has developed the infrastructure to be able to succeed in its next growth phase. It is becoming an affordable place again which companies are looking towards to set-up their local headquarters attracted by the quality of life, ease of doing business and the attractive long-term growth potential of the emirate. Beyond cultural barriers linked to the pride of real estate ownership, public and private groups with significant real estate portfolios in Dubai should integrate this opportunity to raise new capital for the realisation of Dubai’s vision.

Monetising part of a real estate portfolio makes sense when oversupply will prevent massive price increases in the foreseeable future: instead of leaving capital ‘sleeping in concrete’, let it be managed by professional asset and property managers and invest in productive activities, developing employment, Dubai’s GDP and filling available square metres.

DUBAI REAL TIMES

by Olivier Laroche, Senior Manager A.T. Kearney Middle East

13

MARKET TRENDS & ANALYSIS

69 per cent of all civil projects in UAE still active Latest Proleads study reveals UAE civil building construction market has 1,845 projects ongoing worth $657 billion course of the year although the largest proportion of projects are still in progress.

Projects classified within the leisure and entertainment sector amount to over $233 billion spread across 445 projects, while education and healthcare has almost 700 projects worth $57 billion.

“So although the overall situation looks stable, unless investment for new projects is found, the size of the real estate industry will shrink and its overall shelf- life will be reduced,” added Rademeyer.

The UAE study is complemented by a comparative report on the state of civil projects in Abu Dhabi and Dubai. In terms of projects currently under construction, the report finds Dubai has the larger share of the market - indicative of Abu Dhabi projects having started later than Dubai.

“This view is supported further when looking at the scheduled completion dates with the bulk of the Dubai projects coming to a close during 2010 and 2011 and Abu Dhabi in 2012 and 2013,” said Rademeyer.

These studies are a part of a current series by Proleads examining the civil construction industries of each of the six countries of the Gulf

Co-operation Council – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE. Proleads also provides bespoke research and has been commissioned by leading companies

and organisations such as GulfCaptial, Siemens, SsangYong Engineering & Construction and Cityscape Intelligence to provide in-depth focused market intelligence.

How UAE compares with other GCC countries Country

Budget Number of 000 000 USD Projects

Mix Use % Cash flow movement 2008 to 2009 (Projected)

United Arab Emirates Dubai

634,593

1,489

69.91

Abu Dhabi

253,637

634

79.34

Others

128,906

551

80.76

Saudi Arabia

442,320

998

56.21

94%

Kuwait

165,557

214

70.56

31%

-35%

Qatar

50,540

198

69.70

20%

Bahrain

49,294

316

66.77

74%

Oman

44,839

153

75.82

15%

1,769,686

4,553

69.54

-13%

• • • •

Budget is the total announced budget across all project statuses other than completed (i.e. execution, pre-execution, cancelled and on-hold) Number of projects include an adjustment for the estimated number of projects for future master plans Mix use contains the proportion of project count that are part of mix use buildings/developments The last column compares the movement in cash flow in the industry from 2008 to 2009 (Q4 is projected). For example, there is a drop of 35% expected in cash flow in the UAE, but an increase of 20% in cash flow in Qatar

DUBAI REAL TIMES

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he latest research undertaken by Dubai-based research and analysis think tank Proleads, has identified 1,845 projects worth a combined $657 billion are still active (not cancelled, completed or on-hold). The full details are contained within Proleads latest study report that was published recently providing an overview of the civil building construction industry within the United Arab Emirates. The study splits the market into four sectors; Commercial and Retail, Education and Healthcare, Leisure and Entertainment and the Residential sector.

“Throughout our research in each sector, we found a number of common issues, said Emil Rademeyer, Director, Proleads. “Over two thirds of projects are still active, starting of new projects has slowed, projects completing are accelerating, and cash flow is declining.

The largest of these sectors by number of projects as well as by budget is the commercial and civil sector. The total market consists of 829 projects valued at $412 billion.

The residential sector is made up of a combined value of $312 billion. The rate that projects are being cancelled has accelerated over the

15

FINANCIAL ROUND-UP

Mortgage finance guarantee agency needed Activation of home finance flows near to pre-crisis levels while properly managing risk is the key to recovery and future growth of real estate in the Gulf

DUBAI REAL TIMES

T

16

he need for a mortgage finance agency to facilitate and expedite the development of the real estate and property markets was highlighted during a Dubai International Financial Centre (DIFC) event last month.

Speakers and delegates attending the DIFC Economics Workshop on Housing Finance, evaluated the current scenarios, identified the key challenges facing the real estate sector in the region and discussed possible solutions.

It was generally agreed that the activation of home finance flows near to pre-crisis levels was the key that would lead to faster recovery and future growth of the real estate sector, the building and related industries and its contribution to the wider regional economy in the future. However, the need for better risk management in the property development and financing sector; and establishing an improved real estate legal and regulatory framework in the region was also highlighted.

Dr Nasser Al Saidi, Chief Economist of the DIFC Authority, explained the rationale behind holding the workshop. “DIFC hosted this workshop as the real estate sector is a ma-

Dr Nasser Al Saidi

jor contributor to the region’s economic activity, representing major investments that have been made in the residential, commercial and industrial structures capital stock. It was one of the first to get affected by the still ongoing global financial crisis and we need to find ways to re-energise it. One of the key ways of doing this is by exploring measures aimed at increasing housing finance and improving access to finance for buyers; on the supply side, banks and mortgage finance firms need to better identify challenges and improve their ability to manage the associated risks,” said the DIFC Chief Economist.

“The exuberant growth of the sector in pre-crisis times outpaced the institutional structure and sources of housing finance. In particular, we did not have a mature, well-developed mortgage market to support the sector. Now, we feel that a mortgage finance guarantee agency should be established to maintain orderly conditions in the real estate markets, supporting and facilitating this key sector and develWagn Erik Nørgaard oping standard eligible mortgages.

Such an agency would be an effec- critical for bringing about stability in tive bedrock for banking and finan- housing prices.”

Wagn Erik Nørgaard, Vice-Prescial housing finance institutions, enabling them to better manage risks. ident, International Systems Sale, There also needs to be the legal pointed out that: “During the financial crises, the and regulatory infra- Syed Farhan Fasihuddin Danish Mortstructure to support gage Credit mortgage-backed Ins ti t u ti o ns securities and a sechave been ondary market for able to conmortgages,” added tinue to issue Dr. Al Saidi. bonds on a Syed Farhan daily basis in Fasihuddin, Housing Specialist of IFC the market to Global Financial finance home Markets, said: “Inowners loans. creasing the availForeign inability of affordable vestors sold housing finance is heavily out of

Ethical approach to finance crucial for sustained recovery Islamic finance is playing an important role in the economic recovery due to its adherence to ethical principles of finance, according to Hussain Al Qemzi, Group CEO of Noor Islamic Bank and Noor Investment Group. The comments reflect a shift in the way Islamic finance is being positioned in a post-recession

practices could contribute to the world’s financial framework. For the development of a new financial structure, where a reversal to ethics can lend a humanist touch, we don’t need Islamic finance and conventional finance to co-exist, but rather we need one ethical financial model.”

Al Qemzi emphasised that it is in the best interest of the global financial system to start examining ethical means of investing, risk sharing, and regulatory framework that rewards financial institutions for the moral value that they bring to society.

At the ‘Leaders in Dubai Forum’, which concluded recently, Al Qemzi, along with other top executives and entrepreneurs from the GCC, tackled the vital need for transparency and consistency in communicating corporate messages to the public.

With regards to the growth of Islamic finance globally, Al Qemzi said: “Even though the Islamic retail banking industry is at a nascent stage when compared to the conventional banking model, Sharia’a-compliant products have the capability of not only competing with more conventional products but surpassing them in the post-crisis world, as customers seek more ethical and risk adverse solutions to their financial needs.”

Hussain Al Qemzi is a noted speaker on Islamic Finance and the region’s banking sector. In a recent contribution to the Leaders’ analytical handbook for the G20 Pittsburgh Summit 2009, he advocated the development of a new comprehensive financial system based on ethical principles such as those found in Islamic Finance.

Noor Home Hussain Al Qemzi

global financial system. According to Al Qemzi, when systems fail, people start looking for alternatives, and Islamic finance with its ethical approach can fill that gap.

Al Qemzi said: “Ethical financial

Every one of you has your dream home designed, constructed and finished in your mind. You know exactly how it should feel and look because it’s your dream home. When you find the dream home, relief and excitement are quickly followed by worry and frustration. How will you finance this house? Who will provide the best terms? How long will

it take? How expensive will it be? The questions come rapidly with great force, deflating the joy of finding your dream home.

Noor Islamic Bank Home Financing is an oasis for the tired, frustrated home buyer. Their goal is to make you comfortable from the moment you meet. Their products and services are designed specifically with financial convenience and comfort in mind. They give financing of up to 80 per cent, up to Dh10 million over 25 years for your dream home – a dream solution. They have financing for ready and under-construction residential property, (under-construction only for UAE Nationals) for salaried and self-employed individuals Noor offers a standard Ijarah which is a product for those who like it simple. You select the property and they take care of the rest. The bank will buy the property on your behalf and lease it back to you for use. Once the terms of our contract have been met, the property will be gifted to you.

(DIFC). The transaction is part of the company’s $250 million buildup of a real estate investment portfolio featuring key Dubai and Abu Dhabi projects within the next 18 months.

Under the deal with Dubai real estate developer ETA Star, the commercial property represents a longterm investment into DIFC. Liberty House consists of eight floors of spacious open plan offices and 29 floors of luxurious apartments.

Masood Al Awar, CEO, Tasweek, said, “Future Liberty House clients can avail of DIFC’s various businessfriendly incentives, such as freehold ownership of offices and residences, 100 per cent foreign ownership of businesses, an internationally qualified financial regulatory environment, zero-rate tax, and unrestricted repatriation of capital and profits.”

Acquisition of Liberty House

With the highly anticipated completion of the Jumeirah Lakes Towers (JLT) community and the DMCC’s buildings (Almas Tower, AU Tower, AG Tower and J&G), the Dubai Multi Commodities Centre Authority wishes to state that JLT is an integral part of the Dubai Multi Commodities Centre free zone (DMCC) and therefore enjoys absolute free zone status. The DMCC was established by way of a Dubai Royal Decision dated the May 1, 2002 in which its free zone status is clearly stated. Today, 1,800 companies avail themselves with the free zone state-of-the-art facilities in JLT. DMCCA would also like to state that anyone wishing to establish a company and operate within the JLT free zone boundaries is required to be licensed by DMCCA. All premises within the JLT are subject to DMCCA rules and regulations without exception.

Tasweek Real Estate Development and Marketing has acquired a prime commercial property in Liberty House, a 42-storey mixed-use office and apartment structure within the Dubai International Financial Centre Masood Al Awar

Statement from Dubai Multi Commodities Centre Authority

DUBAI REAL TIMES

Danish Mortgage bonds during the crises as those bonds were some of the only liquid securities that still had trust in the financial community.”

Rizwan A. Shah, Director, Leader Capital Projects Advisory MENA Region, Deloitte Corporate Finance Limited, said “Given the many technical and financial challenges that high profile development projects have recently experienced, it is a strategic imperative for all stakeholders involved to have access to accurate information, secure the best advice, and make the most effective decisions to safely navigate through current conditions, and to be in a position of strength once the economy recovers.”

17

COMMENTS

Infrastructure is in need of constant development Dubai Metro brings economic and social change

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ith the launch of the Dubai Metro having already taken place, many people may wonder why the Government of Dubai continues with the development of the project, despite the current economic and financial turmoil that has hindered, delayed and led to the termination of numerous other infrastructure projects. But the emirate’s decision to continue with the Dh28 billion project is a sound one that displays a good understanding of current conditions combined with positive outlook, looking forward to a bright future that will require a strong economy and an advanced infrastructure.

The Dubai Metro represents the practical execution of the Dubai Road and Transportation Authority’s (RTA) strategies for 2015 concerning infrastructure, which aim to provide an integral road and transport system that allows for fluid vehicle movement and the highest safety standards, as well as revolutionising the concept of ‘public transportation’, which is well

Salwa Malhas

known across the world for its time and effort-saving features.

Infrastructure is the backbone of every successful economy, espcially with the many facilities and services it provides to all areas of the community, including investors and businessmen looking for ripe development opportunities to continue their activities. As such, the Dubai Metro, which incorporates a long-term strategic design for its development and operation, will have a strong positive impact on

the emirate’s economy.

Now is the right time for the development of infrastructure that is based on well-laid plans and principles of economic growth encouragement, since economy and infrastructure are inseparable elements of any country. Therefore, it is imperative to set project priorities based on projects’ contributions to economic growth and their ability to create job opportunities for citizens and the private sector. Numerous Arab countries have invested large sums of money in developing advanced infrastructure, but it is even more important to ensure that there is enough money for maintanence and upgrade purposes, as today’s modern infrastructure could easily become outdated in a few years.

The Dubai Metro, which is expected to provide Dh17 billion over ten years, covering 50 per cent of the project cost, may bring more benefit for Dubai’s local economy due to the economic and social change it will bring to the everyday lives of Dubai’s citizens and residents who are used to daily traffic jams

and high transport costs.

Needless to say, the development of integrated transport methods in Arab countries contributes greatly to their competitive edge, both locally and internationally, which in turn increases their economic growth due to the development infrastructure which is the main factor in attracting investments and pumping capital into advanced and mature investments. What is more, the development of alternative transport also reduces traffic jams – the cause of much frustration in the Arab world – and eases traffic flow between different areas, which cuts delays, facilitates official dealings, reduces costs and ultimately increases productivity.

We can see from the above that the Metro is a major element in Dubai’s sustainable economic growth process due its numerous features, especially the economic ones, which will help transform Dubai from a regional city in the GCC, the Arab region and the Middle East into an international city on par with the most advanced capitals of the world.

DUBAI REAL TIMES

By Eng. Salwa Malhas, Executive Vice-President at Al Mazaya Holding

19

COMMENTS

Customer Care

The focal point for today’s real estate industry

By Ms Billy Rautenbach, Director of Operations, Better Homes LLC

DUBAI REAL TIMES

I

20

t is generally understood that markets change over time and this conception usually refers to the price of goods changing.

However, what is perhaps less often noticed is the change in service and product offerings brought about by these changing markets. The past few years in Dubai real estate have been – to put it mildly – a whirlwind tour in market volatility. As one of the major organisations involved in this tumult, Better Homes has gone through changes of its own, specifically in the quality and focus of its customer service. Not only have market prices changed drastically in response to consumer needs, but our own service offering has concurrently evolved as well.

In the interest of disclosure and honest discourse, we can all admit that customer service was not our company’s competitive advantage a few years ago. Interestingly, the foundations of Better Homes were in fact built on customer service, but after 10 or 15 years of growth, this virtue had faded. As demand for property in Dubai skyrocketed, the focus shifted from “how can we best accommodate our clients’ needs” to the somewhat less sympathetic, “how can we accommodate the basic needs of clients most quickly?”

To be sure, this change may have been borne of necessity, but never was it pleasing to lose the edge in customer satisfaction.

Eventually, demand grew so quickly that some agents were even

neglecting to call many clients back.

The rationale was, “if they’re serious, they’ll call again.” Indeed, the agents were so busy they often physically didn’t have time to return every call.

At this point, perhaps three years ago, management realised something drastic needed to be done.

To advance our customer service offering, an entire dozenperson team was set up with the sole responsibility of receiving, tracking, routing, and following-up client enquiries. We called this team Customer Care, and their name quite clearly denominated their purpose.

Not only were people hired for this team, but an advanced call tracking

system was developed and this integrated into the CRM functionality of our backend real estate software, Masterkey. It took over a year to get this new team and associated software streamlined, but it has paid off substantially.

Better Homes is now able to accommodate clients quickly and personally, much as we had done in our early days when such relationships were easier to maintain.

As the global economic crisis swept over Dubai at the end of 2008, these new customer-focused processes became even more critical. Gone were the days when clients would automatically return calls and endure modest neglect. The tables turned, and it became quite clear who then had the upper hand.

Realising the increased importance of customer happiness, our efforts persisted. As an example, a policy was instituted in 2009 wherein agents would be fined Dh200 for any client whose enquiry was not formally followed up within 24 hours.

In 2009, client demographics had visibly changed. Gone were the careless investors who just wanted to snatch up the latest property offerings from the big developers.

Those who were buying from

December and January onward were almost completely end-users, who have very different preferences.

Buying a revenue generating or speculative asset is not the same as buying a comfortable home in which to live (though it can easily be argued that those in the former category should take a hint from those in the later). Given this new dynamic, it was much more common for buyers to discuss with our agents about the aesthetic and practical features of property, and the discussion changed from “this is about predicted ROI” to “this is about family and lifestyle.” This change has, I think, been welcomed by many agents who now feel more involved with their clients and have greater incentive to ensure their happiness.

Incredibly, in recent months, Better Homes witnessed the highest number of leasing enquiries in our history. Even so, the number of redirects from agents who haven’t answered calls is down 70 per cent.

Our customer satisfaction surveys have reflected this improvement, which has resulted from the heavy emphasis we now place on customer service as well as the technological and procedural changes we’ve implemented. As the market changed, we saw the importance of reemphasising this core virtue of customer service, and the result has been clearly positive.

This is a lesson we will not forget soon.

COMMENTS

A world without project failure

B

illions of dollars are wasted every year on project investments that fail to deliver the desired benefits. On a global scale, 24 per cent of all projects either fail, are cancelled, or delivered but never used. These failures are not limited to a specific industry but affect projects in the fields of engineering and construction, oil and gas, power and utilities, information technology, telecommunication, aviation, and many others. The failed projects are usually attributed to many factors, including unclear objectives and scope, poor planning and execution, organisational and political issues, unqualified delivery team, stakeholder conflicts, incomplete risks analysis and treatment, ineffective quality assurance and quality control among many others.

With organisations in both private and public sectors continuously investing in new projects to meet their strategic goals, the trend of wasted funds due to failed projects should be stopped. The botched projects squander substantial investments that cannot be recovered, resulting in missed opportunities as the funds could have been used to invest in more valuable projects. Corrective actions need to be taken by organisations to eliminate the causes of the project failures.

The question that many executives ask is: why are failures in delivering the desired results of projects much more likely than failures on the daily operations of the organisation? The answer is very clear; most organisations are structured in a way that creates an unfriendly project delivery environment.

The majority of organisations are usually designed around functional departments that are needed to run the business. For example, organisations will have departments for human resources, operations, engineering, legal, contracts, procurement, financial, maintenance and projects. Over time, these departments become silos that do not collaborate with each other.

Actually, in several instances, due to the politics within an organisation these departments compete among themselves and become less willing to support other departments.

This unfriendly environment increases the chances of failure as projects by nature tend to be crossfunctional and require the proactive collaboration of all departments.

To change the unfriendly atmosphere to a more project-friendly environment, organisations must change. They need to allow the best practices of project management to exist and survive within their own organisation’s system. To facilitate this change and empower them with the processes and tools that will enable them to deliver their project investments successfully, it is always best for organisations to acquire help from specialists who will come up with different solutions.

Organisations, however, must also pay attention to the track record and experience of project management solutions providers to ensure the best results. In this regard, CMCS, a provider of leading Project Portfolio Management solutions, advocates a set of five pillars of excellence.

The first pillar of excellence is maturity assessment. Through this service, current project management practices of an organisation can be diagnosed, helping identify good and bad practices. This health check assessment is based on the Organisational Project Management Maturity Model (OPM3) developed by the Project Management Institute (PMI).

CMCS, for its part, bundles its diagnostic services with regular assessment of the effectiveness of the Oracle Primavera Project Management tools that an organisation is using.

The second pillar of excellence is developing policies and procedures that an organisation needs to adopt to ensure successful project delivery and governance. Policies could cover

Bassam Samman, CEO and Founder, CMCS, said, “With several companies increasingly looking to invest in new projects and meet their strategic goals, the trend of wasted funds coming from failed projects should be stopped.

These failed projects have translated into huge financial losses, which can no longer be recovered and has robbed us of the opportunity to put the funds into other investment initiatives that could have benefited organisations.

Corrective actions should immediately be taken to effectively tackle this situation, and major, well-established companies have an important role to play in this regard.”

project management, earned value, risk management and project controls.

These policies are developed following international project management standards such those developed by PMI, IPMA, PRINCE2 and many others.

The policies are mapped into processes that identify the procedures to be followed during the different phases of the project’s lifecycle. It is also important that policies and procedures are developed in a format that will ensure ISO certification.

To enable cross-functional collaboration in project delivery, organisations need to establish an entity that takes responsibility for implementing project management related policies and procedures. In this regard, the third pillar of excellence is helping organisations set up and roll out a project management office (PMO) that best suits an organisation’s needs. The PMO

organisational structure, lines of communications, responsibility assignment matrix, job description, performance appraisal and career planning for the PMO team members will also have to be developed.

The fourth area of excellence is professional development and training. In several cases, more than 90 per cent of professionals involved in project delivery have not received any formal project management education or training, which substantially increases the chances of failure. It is thus no wonder that some major organisations in the region like Saudi ARAMCO have made it a top requirement for all project managers to have formal project management certification. On the other hand, professional institutions such as PMI, AACE, EMCI, IIBA and others have developed globally accepted certifications for project managers. CMCS, a global education provider, confirms the growing trend of organisations seeking relevant certification as it has trained thousands of professionals every year for Project Management Professional (PMP), Earned Value Professional (EVP), Planning and Scheduling Professional (PSP), Certified Business Analysis Professional (CBAP) and many other certifications.

The fifth pillar of excellence is portfolio project management technology. A solutions provider with extensive global experiences in selling, training and implementing Oracle Primavera products can certainly help make a difference in ensuring optimum return on investment. CMCS alone counts more than 1,200 organisations from a diverse range of key industries in the Middle East that have availed of its services for the implementation of these project management solutions. The organisations have used this to better plan their projects, record actual progress, monitor and visualise projects performance, and assess trends and impact of changes on the project objectives.

DUBAI REAL TIMES

By Bassam Samman

21 3

COMMENTS

Human resources that will make you win While the market focus has moved from ‘off-plan’ to ‘resale’, many real estate agencies are finding it hard to overcome the need of a new business model. Overlooking one of the key factors in their business - non performance of staff - could be the toughest challenge.

Cecilia Reinaldo, Managing Director of Fine & Country, explains how to identify the non -performance signs and to become resilient.

DUBAI REAL TIMES

I

22

t is a fact that in a real estate environment, we need sales.

Without sales, we are not in business.

Non-performance has led to the closure of many businesses recently, and although everyone believes that it is the nonperformance of the markets, I can assure you that in most cases, it is the non-performance of sales staff.

In a previous issue of Dubai Real Times the value of improving your market knowledge was highlighted as the first step to improving your sales ‘bottomline’. One of the underlying recommendations was that agents should dedicate two hours each week educating themselves by reading and studying the wealth of information available on local and global property markets and how possession of this information will quickly translate in client acknowledgement of their new found expertise.

Conversely, I was in a hotel lobby and could not avoid overhearing a conversation from what I would presume was a relatively new entrant to the UAE property market, advising a group of evidently disillusioned businessmen “that the market will definitely go up” and “they are guaranteed to get double digit rental yields.” I will never know whether a deal was made. But, as the old saying goes: if you think it’s

As the old saying goes: if you think it’s expensive to hire a professional to do a job, wait until you hire an amateur (Paul ‘Red’ Adair)

expensive to hire a professional to do a job, wait until you hire an amateur (Paul ‘Red’ Adair).

tools and equipment (website, computers, and advertising), budget and marketing material.

Here a few points that estate agency owners should have a close look at:

Capacity: Non-performance becomes the result when the agent does not have the skill to perform the job. In real estate, we often find that the agent does not have the ability to close the deal, or the agent does not know how to negotiate - knowledge, skill and attributes are key to this business. There are certain activities that are essential for an agent in order to be successful, and the education approach must therefore focus on the ability to do the things that will result in generating an above average income. Previously, most business

Resources: In practical terms, a few have the resources to take on extra financial commitment but, remember, when a company recruits a top agent, the company uses its current resources to draw this high profile estate agent to join them.

When the company does not supply the resources to assist the agent to do the job, it is to be blamed for the nonperformance of the agent. Lack of resources can include: understaffing (admin and marketing support),

training became ‘manager-centered’, focusing on teaching agents in a classroom about what to say and do, and memorising what must be done.

This method is fast changing back in favour of ‘agent-centered’ and task-based approaches whereby an agent first performs role plays in the office to prepare them before they do it in the field. This is an excellent opportunity to interact with a senior agent or manager and to learn the finer skills of negotiating.

Behaviour: The agents decide not to do certain tasks and simply ignores them. They ignore the guidelines prescribed by the company and sometimes deliberately refuse to cooperate with colleagues. One to one meetings with your agents will give you a closer understanding on the above. A close inspection might give you the exact reasons for underperformance.

In the end, we all need to go back to basics:- estate agents in the UAE need to learn to let go of the past.

Holding back on the thoughts of the ‘big deals’ you made and the ‘record’ reservation forms you managed to conclude are never going to get you to where you are trying to be; and time immemorial has illustrated that these thoughts are the very same that will hold you back from here to eternity.

COMMENTS

How mergers could save the property and financial sectors Mohanad Al Wadiya, Managing Director of Harbor Real Estate Brokerage, shares his thoughts on upcoming mergers

Development and Union Properties, with news about the latter having liquidity problems and losing its long-time chief executive recently.

While these developments are important for the sector, the most significant merger in the region is currently being discussed between Dubai Holdings’ ‘Big 3’ companies and Emaar, a most popular developer in the Middle East. Dubai Properties, Tatweer, and Sama Dubai—collectively known as ‘The Big 3’—are fully-owned subsidiaries of Dubai Holding Commercial Operations, a holding company of Dubai Holding Group with total assets of Dh126bn at the end of 2008, as quotes by Emaar.

There is a growing consensus among the officials involved that allowing healthy businesses to acquire companies in jeopardy of failing could stabilise the

economy by bolstering confidence in both the financial and property sectors. For some of these companies, merging with a partner that has a strong balance sheet is a pressing and essential step in preventing dissolution.

Other benefits include leveraging economies of scale and having stronger negotiation positions with regard to suppliers and contractors. The mergers will allow companies to work together to achieve long-term, strategic benefits by uniting complementary businesses into a single, sufficient and more successful operation. For the property sector, these mergers will also allow consolidated companies to have better control of the overall supply introduced into the marketplace and the quality of the products and services offered. This will definitely have a positive impact on the market in the long run.

On the other hand, there are concerns that

these mergers will place heavy burdens on the stronger companies involved. These partners are not just taking over assets, but may also be inheriting large liabilities and debts. Furthermore, these mergers are likely to generate a lot of uncertainty among the investors and shareholders involved.

Investors might have to accept further delays until these mergers are finalised, and will then have to evaluate the impact of the mergers on their investment.

Whatever the impact, the number of mergers involving financial and property organisations is increasing.

For these new companies, the ability to provide prompt, transparent, and practical information that guide all stakeholders through the merger process and expected outcomes could make the difference between success and failure from the public’s point of view.

DUBAI REAL TIMES

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or many players in the local market, mergers and acquisitions appear to be a logical solution to stay afloat during the global financial crisis.

Opinion is divided as to whether these mergers and acquisitions will have a positive or negative impact in the short and medium terms, and it is too early at this stage to predict success or failure. Nevertheless, it seems clear that without these actions, the result would be a freeze in financing facilities and diminishing activity in the property sector, which would have an adverse effect on the overall economy.

Within the financial sector, these kinds of mergers really started as early as last year. It all began when Amlak and Tamweel announced a merger to create Emirates Development Bank in November 2008. The new bank will have access to federal funds and hopes to strengthen the UAE’s home finance sector. The merger news gained considerable media attention and created very high expectations.

In terms of property development, we have seen similar mergers within the last year. Dubai World, the major property and ports conglomerate, recently consolidated its management and property operations of Leisurecorp, Dubai Maritime City, and the Dubai Multi Commodities Centre, all of which it owns. The property divisions of these companies will now be run by Nakheel, another property arm of Dubai World.

There is also continued discussion of a merger between Deyaar

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COMMENTS

Realty rebound:

Pricing recovery bodes well for MENA property markets Even hardest-hit Dubai is showing forward movement

By Majed Azzam, Senior Analyst- MENA Real Estate Sector at HC Brokerage

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he once buoyant MENA real estate sector has been very busy staving off the adverse effects of the global downturn over the past year. The industry’s persistence and patience appear to be paying off, though, as October 2009 transaction price indices indicate a rally from the first half of the year.

Dubai’s services-based economy is the most closely linked to the global economy and was thus hardest hit by the crisis. The resulting expatriate departures, oversupply and speculation led to rapid declines in property occupancy levels and rental yields, with realty rates bottoming out in April 2009. However, October transaction prices show that the Dubai property market has since rebounded by nine per cent. As Dubai is viewed by foreign investors as a representative of the MENA markets, especially in terms of real estate, this development is being viewed as a possible catalyst for a sustained industry recovery.

“MENA property indicators as of October 2009 reflect a growing market confidence in the UAE. Abu Dhabi and even Sharjah and Ajman have been offering highly attractive deals, while former Dubai residents who were driven away by high rentals are now returning due to considerable price drops. As a favourite travel and lifestyle destination, the UAE’s gains in the sector can be expected to spill over throughout the rest of the region. Current condi-

tions are in line with predictions of a solid property rally come 2010,” said Majed Azzam, Senior Analyst- MENA Real Estate Sector, HC Brokerage.

October 2009 data from investment banking, asset management and securities brokerage and research firm HC Securities reveal that mortgage values and volumes in the Emirates have steadily eased back to pre-crisis levels, reaching 24 per cent and 14 per cent for the month compared to seven per cent and six per cent last April. Asking rentals in Dubai have receded for the ninth consecutive month since the start of 2009, retreating 38 per cent year-todate. Overall, the rate of decline has slowed down considerably in the past months: it was at two per cent in September and October.

Signs of job market stabilisation also indicate a positive outlook among employers on accommodation expenses and other cost fac-

tors. Online global recruitment agency Monster.com reported an 18 per cent month-on-month hike in job listings across the Gulf last June, which is expected to stabilise rental rates. There is a growing consensus that the impact of expatriate migration will be less damaging than expected.

Mortgage providers have been raising their loan-tovalue ratios, relaxing their credit policies and reducing their rates in line with an Emirates Interbank Offer Rate which has slid from 3.87 per cent in January of this year to 1.95 per cent last October. And while Dubai’s property market is still recording weak figures, transaction data suggest that it is still dominated by cash buyers who comprise around 79 to 85 per cent of

transactions. The emirate is estimated to welcome an additional 60,000 units to its market by 2011.

Nevertheless, the general consensus is that the property sector will experience a peak-to-trough drop of 40 to 60 per cent towards the year’s end. And while most investors are optimistic about property market fundamentals in Abu Dhabi, Riyadh and Cairo, they remain cautious about Dubai’s progress. The slide in rental rates and the yield compression occurring in Dubai amidst improving macroeconomic conditions are providing a silver lining though, as they are motivating realty investors to prepare for possible upward revisions of net asset values. Developers who will be able to build up a robust investment portfolio and maintain occupancy levels will emerge victorious amidst these prevailing trends.

COMMENTS

Resale heaven?

When things go well, time flies, but when things go the opposite way, time seems to stop dead!

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t does seem a long time ago that I was actually in New York, looking up at the Lehman Brothers building last September, and thinking I bet those chaps are making a fortune. Little did I know how close I came to the eye of the financial storm!

Well a year has gone by and there is life after all in the UAE, but it’s been a very rough ride for almost all of us. To say everything is back to normal would be a lie, but there are small signs that things are looking up, and the spin is now a bit more upbeat, not just here in the UAE, but around the world.

Let’s not forget that here, it would seem, apart from having to deal with the recession, we also had a load of bad apples to get out of the UAE system as well. The overseas press had a field day reporting about the real estate market crash everywhere, but to most reporters, the juiciest stories unfortunately were focusing on the UAE. Every week, we read in the newspapers that the jails were full of ex-CEOs and Sales Directors of major property companies who were now behind bars, for apparently fiddling the books.

Half of the overseas investors still have nothing more than a billboard near a motorway, as evidence of their large investment into the land of off-plan.

First, we came across that

dreaded word ‘subprime’, then the buzzwords used as a regular excuse were ‘global recession’. But perhaps ‘off plan’ is now edged to the top of the pile for bad karma words.

The UAE has always operated on the off-plan principle, where the investor financed the projects. Well , nowdays no one in their right mind will part with their hard-earned cash unless the building is reaching for the skies and the marble fountain in the lobby is fully operational.

The past twelve months have not been a great advert for our local property industry.

The government has tried to support the property industry, and to a certain extent, the buyers too, but have they done enough?

Still to this day, the Strata Law is not in place. Developers have been bailed out by the government funds, but even if they complete their existing projects, will there be any lenders around to assist in the buying cycle?

You will need to be a top dentist earning a fortune, with a hefty deposit to even be considered for a UAE mortgage. While the UK has lenders offering 2.5 per cent mortgages, here we have to pay up to nine per cent to have a mortgage, sometimes only for government backed developments.

So what are the positives to look forward to in the UAE?

Well certain areas, especially in Dubai Marina, Mirdiff, JBR, the Views, and the Old Town are almost complete, and the wheelbarrows and dust will soon be history.

Iconic Dubai will always outclass most cities for looks, with a number of great buildings, such as Emirates Towers, Burj Al Arab, Grosvenor House, Park Place and the Madinat Jumeirah, all leading by example.

And let’s not forget the world’s tallest building, Burj Dubai and its wonderful fountains. Due to the recession, who do you think will have the funds to compete for height in the future? It will, I am sure, keep its title for many years to come.

We should not leave behind Abu Dhabi, who in one short amazing week, stepped up in people’s admiration and took the global centrestage almost overnight, with the wow factor Formula 1 Grand Prix.

Some of the crazy plans to build an underwater hotel, or the Dubai Waterfront’s one-kilometre tower maybe on hold forever, but I bet most tourist boards around the world would still love to boast of just a few of the UAE’s great facilities.

Numerous first class hotels, superb shopping malls, state-ofthe- art metro, outdoor activities in the desert, top class sporting events, great international restaurants, and

a vibrant conference and exhibition industry.

Let’s not also forget that both Dubai and now Abu Dhabi’s airlines are offering the best service in the sky and their airports on the ground are a pleasure too.

Add this all together into the mix, and even if no more new hair brain ideas come off the drawing board, the UAE still has a lot to offer.

The big question is how do you attract overseas investors back to the table again? Unfortunately, it will be a long and difficult task as you cannot buy confidence.

Maybe the government could assist the private developer and co-finance or even buy out their properties. Then, to clear this stock, why not rent out these apartments to tenants, giving incentives to rent, then buy. It worked before in the Greens, so why not again?

Hopefully, the UAE’s great facilities, its industry, natural resources and, of course, the fabulous climate will draw international visitors, conference delegates and eventually that very rare species ‘the overseas property investor’ back to the table.

Mike Bridge is organiser of the Worldwide Property Shows in Singapore at Suntec City on February 27th-28th 2010 and in Dubai at the Grand Hyatt on June 3rd-5th 2010. www. wwshows.com

DUBAI REAL TIMES

By Mike Bridge

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COMMENTS

Gone with the gong Raymond Kuceli, CEO of Madania Real Estate, provides key insights into how to get the most from property auctions

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adania Real Estate launched the first public property auction programme in Dubai in May and is determined to increase understanding of the process in order that buyers and sellers get the most value from the process.

What is the public property auction programme?

The Madania property auction programme is a three phase process with a 60 day duration. The process begins with a vendor signing up exclusively with the company in order to sell a property. Properties must meet with the Land Department’s requirements.

Only ready properties with title located in Dubai will be accepted for the process.

Once all conditions have been settled, a four week aggressive marketing campaign begins during which the property is advertised to attract cash buyers ready to purchase. The buyers are free to bring in consultants such as surveyors to inspect the property, in order to judge the property on its merits and decide if and at what price they wish to make an offer. If a buyer wishes to make an offer during phase one, they will be considered.

The second phase is the property auction event itself, managed by the auctioneer. Buyers gather at the event, there is no fee to attend, and bid competitively against each other for the property. If the Seller’s reserve price is met or exceeded, the property will be sold. Representatives of the Land Department will also be present and buyers must pay a 20 per cent deposit upon the acceptance of a winning bid, with the balance paid up to 30 days later.

If the property is not sold, all the information gathered during the first and second phase will be used to gen-

erate a buyer in the third phase.

The Seller’s journey: The first thing you need to know is that the owner never loses control of his valuable asset and that when the owner auctions his property, it should not be considered a last resort. Instead, it is a clever move to secure the best value for an investment.

At the outset, a skilled auction trained consultant clearly explains the process to the seller. This is especially important in Dubai, because although the process is well known in other countries we are pioneering the method in the UAE and therefore starting from low levels of knowledge.

One of the key things a client needs to understand is that the process requires commitment from both the Agent and them, as the Seller.

The Agent secures this commitment with an exclusive authority to sell the property, which clearly outlines both parties’ commitment. As all auction properties must be registered with the Dubai Land Department, the company also requires some documentation from the Seller to get the process started and the documents required will vary accordingly.

If the Seller’s property has a Title Deed, the Agent will require the Title Deed, site plan and no objection certificate from the master developer to sell in an auction, the Seller/Agency agreement, as well as, the Seller’s passport copy, statement of services charges and, if applicable, a copy of any tenancy agreement on the property.

Once he has all the documents and the property is registered, the process can move into the exciting part - marketing and then selling the property.

The company meets with the Seller and gathers as much information as possible on the property, during which time they set in place the tasks required by each party. They agree on the process and sign an authority to sell the property using the auction system, and also sets out the costs involved. The next step is to create a marketing programme best suited for the property and schedule the critical dates. The auction is conducted at an agreed venue, and if it is not sold at the auction event, the phase three programme will commence.

Buyer’s ambition First time buyers using the auction process don’t need to worry that it is difficult, but there are a few things that you should be aware of as buying a piece of real estate can be a testing time and being armed with information will help smooth the process.

Firstly, buyers need to be aware there is no price that is stated for a property. This is because the owner is looking for the true market value of the property. However, the company encourages buyers to research comparative properties in the surrounding area, to get an indication of market value for similar properties.

The properties will be advertised in

different media and the buyer will have the opportunity to view these properties at specified times, usually twice a week, at open inspections. Once a buyer has viewed a property, they may wish to view the property again – perhaps with a valuer or a builder, or just a friend or family member who can give a second opinion. This can be organised.

It is important for buyers to make sure that they have their finances in place, before they attend the auction.

Buying at auction will require the buyer to pay 20 per cent of the agreed price at the time of the auction and the balance of the purchase price at the transfer which will be up to 30 days after the auction unless otherwise agreed upon.

This is a binding process.

After all this is complete and the buyer is sure they want to be the owner of the property, they will arrive at the venue of the Auction event with their passport and their cheque book and they will be ready to register for bidding.

A few things to remember: • There is nothing to be frightened of - most others are in the same boat as you, they have not bid before • Make sure you know your limit and stick to it – go in with a clear idea of the maximum amount you are prepared to pay for the property • There are others who will want the property, so people will bid against you • Make sure your bank has clearly given you an amount • There are clear conditions of Auction you will be required to adhere to – so make sure you receive a copy • You will need to be registered to bid - this can be done before or at the auction • Be there early and make sure you have a good position so your bid will not be missed.

COMMENTS

Oversupply in retail space Reidin.com information partner Global Investment House forecasts oversupply in retail space to push rental rates downwards

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"The Dubai Land Department is our knowledge partner. They have the data which we make useful," said Ahmet Kayhan, CEO, Reidin.com. "We have a contract for 10 years which is extendable for another five years. It is a direct partnership both on the revenue side and marketing side. So it is convenient and beneficial for both parties." He stressed that portals other than Reidin.com cannot carry the information or data of the Dubai Land Department. Elaborating on the partnership, Kayhan said that the source of the data is the Dubai Land Department, whilst all the analytical tools, the search engine, design, maps and statistical systems are Reidin's.

"It is our own patented, copyrighted individual information. There was basic information from different servers of the Dubai Land Department. We worked with them for eight months to make such information readable, starting from 1973," Kayhan said.

tional, the company’s information partner, revealing that premium retail destinations such as Mall of the Emirates, Dubai Festival City and Burjuman have emerged as the most expensive in the UAE. Among the establishments that offer the most extensive gross leasable area (GLA) across the emirates are Dubai Mall (344,000 square metres), The Walk (1500 square metres), Oasis Mall (60,000 square metres), Mirdiff City Centre (183,000 square metres), and Dubai Marina Mall (77,000 square metres).

“In a market as active as Dubai, accurate and relevant information is key to ensuring that investments result in returns and targets are met.

We are keenly partnering with government agencies and other organisations to extend the scope of our information gathering,” concluded Kayhan.

REIDIN.com has pioneered the concept of providing extensive and interlinked databases of shopping centre and retailer profiles, Gross Leasable Area (GLA), footfall statistics, price data, news, research, upcoming retail projects, owners, developers, and property manager profiles, all of which are supported by analysis and advanced comparison tools, and a powerful search engine. Backed by a repository of

hard-to-get data and information, the retail property market in developing economies, coupled with the tools to analyse and make calculated

decisions, ‘RetailFocus’, delivers an up-to-date market insights, along with retail real estate news and research reports.

About DUBAI Focus Currently for Dubai only, DUBAIFocus provides data, information and analysis covering all Deals & Transactions registered in Dubai since 1973 with daily updates. Powered by an exclusive partnership with the Dubai Land Department, DUBAIFocus offers the most granular level of transaction data and analytical tools available, including advanced mapping and graphical functionality.

Features: DATA • View districts and have a first sight intelligence on Dubai property market through Property Transaction Heat-Maps • Get full access to all real estate transactions - residential, commercial, industrial, land, et al - categorised by value, size, district, buyer/seller demographics, transaction types, etc.

• View results on the map or on a tabular format • Download results into spreadsheets • Find lands and properties directly on the interactive Dubai map and reach all transaction history on that particular land or property.

• Track trends through built-in intuitive categorisation tools.

• Get results delivered in the form of customised charts - pie, time line, bar • Get answers to critical questions like what property was sold, to whom, in which district, at what price, and financed by which bank?

ANALYSIS • Perform comparative analysis through online analytics and comparative tools.

• Search in-depth timeline series specific to Dubai property landscape

DUBAI REAL TIMES

ubai’s retail sector is witnessing a rise in annual rental rates, which has hit $1,800 per square metre, according to a report by Global Investment House, a Kuwait based investment company and information partner of Reidin.com, the world’s first global online information services provider. The report further reveals that there is an impending oversupply in retail spaces in the emirate, which is set to push rental rates downwards in the coming years. With aims of providing upto-date information on the dynamic retail property sector, the company offers ‘RetailFocus’, a product that leverages extensive and interlinked database on retail real estate markets for the benefit of buyers, investors and stakeholders.

Reports published by Cushman and Wakefield, an information partner, have revealed that there is tightness in the availability of units in prime locations, with retailers increasing focus on AAA locations and their efforts to scale down presence in less profitable areas expected to result in downward adjustment in rents in secondary streets. Occupier demand is also expected to continue being selective, thus preventing global rental growth from spiking unless a period of recovery ensues.

“The upward movement in rental rates within Dubai’s retail property sector is reflective of the correction phase that is sweeping the UAE’s real estate sector, which validates the high value of maintaining presence within one of the world’s most sought-after retail destinations,” said Ahmet Kayhan, CEO, Reidin.com.

Dubai’s global repute as a premier leisure and shopping hub has created a significant impact on the local retail scene, with further statistics provided by Colliers Interna-

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COMMENTS

Market stability a question of time Dr. Wan Hasni

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n a recent Colliers International report, the property services company predicted a further 20per cent drop in property prices before the market stabilises. While the analysis is a useful benchmarking tool, it paints an incomplete picture of what is currently happening here in Dubai.

The Dubai market is currently maturing to become quite similar to other established real estate markets in the East like Singapore and Kuala Lumpur.

The key issue in the Dubai market today is about the real supply vs. demand and the yields landlords can expect. In maturing markets, there are a few common traits: gross yields (or income rate) generally run from eight per cent (for residential) to 10 per cent (for commercial), and the gross occupancy ratio is usually in the neighbourhood of 80 per cent (i.e. 20 per cent vacancies). In better times, the gross occupancy ratio can go as high 90 per cent, but if it ever reaches 95 per cent, then the market is overheated.

A simple way to analyse property prices and whether they will continue to drop further is to use the 10 times multiplier: that is, if a property can earn a gross income of Dh100,000 per year on the rental market, the stable market price of the property would be Dh1 million.

What we have been seeing in

Dr Wan Hasni

Dubai are rental prices dropping to ‘reasonable’ levels – which can be used to calculate the true property value (by the 10 times multiplier).

However, some property owners are not willing to let rental or sale prices go down and are currently holding their stocks. This keeps some property prices artificially higher (as landlords or sellers anticipate getting better deals at a later date). In truth, these better deals rarely materialise as many more new units come onto the market offered at cheaper prices for both rental and sale.

My analysis of the Collier’s assertion is that where property prices have been kept at artificially high levels, there will be a further 20 per cent drop, but even those statistics are always a generalised version of numbers and can be misleading.

Does this 20 per cent decrease apply to all properties or just select properties – the Dubai Marina or other similar high-end properties, for instance? Does it also apply to International City or Discovery Gardens? I believe not, because in these locations, we have already seen the rental rates level out with the property prices based on the 10 times multiplier.

In other areas of town, this has not necessarily been the case (i.e. prices are higher than rental rates the property can command). For such properties, a price drop of 20 per cent or

even more would not surprise me, as it is what a sensible economic model would forecast.

There is one other force in play to consider. The distressed sale – wherein owners who are desperate for cash to cover their liabilities are selling properties at prices below the market value. In any market, these prices are always on average 30 per cent lower than the true market value, and these sales distort the statistics, because they artificially bring down the average prices.

These properties are sold at less than the value the 10 times model would indicate when considering their rental prices.

In summary, look to the rental rates as your indicator. If they go down further, then you can expect the property prices to follow. However, based on my casual observations, it has been holding steady for several months now. If it ever drops lower, then you will see that rental demand will immediately start to pick up, because it will make those who live in other emirates consider a move to Dubai.

It is clear that Dubai already has an economic mass that will keep the market steady and sustainable, and prices to be stable over the long term. Market stabilisation is merely a question of time.

Dr. Wan Hasni is the Advisor in Charge of Tanmiyat.

Traditional property sales move UAE market Off-plan property sales model unsustainable; return to traditional buying methods evident, says leading UAE developer Traditional business models that market new properties are gaining in popularity and beginning to generate more sales than off-plan projects, according to a leading UAE property developer in UAE. “Off-plan property sales have proved to be unsustainable,” said Mohammed Nimer, CEO of MAG Group Property Development, which is involved in Dh3 billion of developments in the UAE. “With so many projects heading towards completion, and with little difference between the prices of completed and off-plan properties, why would a bank or an owner-occupier take any sort of risk; a completed property is tactile and ready to move in.”

“Sales enquiries for off-plan property have been stagnant now since the third quarter of 2008 – completed properties are however starting to show signs of life,” Nimer added. “Buyers now have the luxury of inspecting the actual villa or apartment that they are considering

Mohammed Nimer

buying methods. This means a property development is fully financed by a combination of sophisticated private equity investors prepared to take the risk, and the banks. The end-user, or owner-occupier, does not become part of the transaction until the very near completion of the building”. He continued: “This means that the risk of a development being abandoned in a tough selling environment is reduced as both the developer, the private equity investor and the banks are too exposed to

do anything other than complete and handover the property. In the boom years, we saw small investors take the place of professional private equity investors, and in many cases, even the banks, to finance property development with the results we see today. With

The challenges ahead Networking session examined ‘Industry outlook and challenges ahead’ Dubai Property Society (DPS), an association of professionals engaged in the real estate sector in Dubai, highlighted the status of the global and local real estate market during its participation in an ‘invitation-only’ networking event during Cityscape Dubai.

Titled ‘Industry outlook and Challenges Ahead’, the networking luncheon was hosted by the Dubai Chamber of Commerce and Industry (DCCI) at the Al Massa Ballroom, The Monarch Hotel.

The event, which comes as part of DCCI’s drive to build upon its portfolio of networking events, included a panel discussion on current challenges and opportunities in the Dubai Adel Lootah market.

Adel Lootah, Executive Director of thrown up by the current economic situation.

Dubai Property Society, participated in the In addition, he offered a general overview on panel discussion as a keynote speaker and the real estate and property market in 2008 and highlighted the projects and services planned 2009.

by DPS. Lootah also offered an update on Mr. Lootah said: “Dubai Property Society DPS’ recent activities for its members that combines a rich portfolio of industry experts particularly aimed to address the challenges as members. We are working towards joining

banks now having little appetite for high-risk investments, off-plan is an unsustainable business model - the future is the traditional, completed property transaction.”

forces with all industry players, including government and nongovernment institutions, in our ambition to increase our contribution to the economy of Dubai.”

Established in 2000, Dubai Property Society (DPS) was launched with a mission to energise business relationships through hosting networking events, informative lectures and awareness seminars on industry issues for the holistic benefit of each member of the society and the community at large. With a membership base of over 300 real estate professionals, DPS provides access to a vast network of property owners, developers, managers, advisors, brokers, finance houses, banks, hotel owners, hotel operators, insurance companies, IT and technology solution providers, as well as mall owners and operators.

DUBAI REAL TIMES

purchasing - no longer are investors risking capital on the basis of an artist’s impression and a salesman’s promise.”

“It’s also interesting that unfinished property prices have fallen further than those for completed apartments and villas,” added Nimer.

“Everyone in the property business today is going through challenging times,” Nimer commented.

“Prices, targets and ambitions have dramatically altered. But overall, the market will benefit from a more rational approach to real estate investment as opposed to the speculative market model of 2007 and 2008.”

The collapse of the off-plan property model affected not only the UAE, but other more developed property markets such as the UK and Spain. Those markets moved away from their traditional property buying methods and have seen similar declines, with small investors often left holding property with negative equity.

“Mature property markets have turned away from the off-plan model and returned to the traditional

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Community

Proving their mettle It has been a season of congratulations and kudos for some of Dubai’s companies and businesses - and they can prove it, judging by the trophies awarded during the past few weeks.

Well done to all of them …

DUBAI REAL TIMES

(from left to right) – Stuart Shield, CEO, International Property Awards presented two Arabian Commercial Property Awards to Danial Schon and Asher Schon, both Vice-Presidents of Schon Properties, for their flagship developments Dubai Lagoon and Schon Business Park in the Best Mixed Use and Best Office Development categories respectively

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UAE property website PropertyStop.ae won the Best Property Portal award in the CNBC Arabia Arabian Property Awards. The website is a project by RichWeb which is a member of Tharaa Holding. Commenting on the achievement during the awarding ceremony Mr. Shabeer Mohammed – Managing Partner of RichWeb expressed that: “We are committed to innovation and to applying the highest international standards in all our businesses and projects. The award comes as a clear proof of our principles.”

Jones Lang LaSalle MENA has been named Best Commercial Property Agency Arabia at the 2009 CNBC Arabia Property Awards where the firm also won the ‘Best Commercial Property Agency – Dubai’ award. Matthew Hammond, Head of Agency, Jones Lang LaSalle MENA accepted the awards on behalf of the firm

Proud of its success, P&T Architects and Engineers Ltd (Dubai Branch) recently announced that the company won two prestigious Arabian Property Awards 2009. P&T won the Architecture Award for the Kensington Krystal project, which is an office tower located in the Dubai Maritime City and an award for Best High Rise Architecture for its Ajman Corniche project

Eng. Hussain Nasser Lootah, Director-General of Dubai Municipality said the Municipality pursues a policy of well-planned steps and works as a team to reach the best practices. He was speaking while receiving certificates for quality systems in accordance with the requirements of ISO 9001:2008 international standard for nine organisational units in the Municipality. The ISO certificates were awarded to Sewage Network Department, Drainage and Irrigation Department, Contracts and Purchasing Department, Partnership Department, Food Control Department, General Maintenance Department, Public Health Services Department, Survey Department, and the Director-General’s Office

(from left to right) Mr Clive Horwood, Editor, Euromoney presenting the Euromoney Real Estate award for ‘Best Developer in the Middle East & North Africa’ to Mr Naaman Atallah, Group Managing Director, Hamptons International. The property services company with an extensive portfolio of projects in the region, clinched four top laurels as the Best Advisory & Consultancy, Best Valuation, and Best Research in the Middle East & North Africa (MENA) region. It also won the country award for ‘Best Advisory & Consultancy’ in Oman

Zain Mustafa was awarded the prize as winning designer of the first ever contemporary majlis competition at Index 2009, sponsored by Al Nakheel, last month. DMG World Media, the organisers of the exhibition, set the challenge of creating a contemporary majlis to four leading interior design companies based in the UAE - Etcetera Living, Hirsch Bedner Associates, House of Zunn and Zain Mustafa. Each company showcased their vision of a modern majlis on the exhibition floor

(from left to right) Wafa Tarnowska, Regional Manager for CSR Arab Initiatives and Furmeet Kaur, Partner. DLA Piper received an award for its commitment to CSR at the Women in Leadership Awards recently. The ‘Best CSR Initiative of the Year’ recognised the international legal practice’s holistic approach to CSR, from its empowerment projects and environmental policies to the activities of its dedicated CSR Manager. The award was DLA Piper’s second in a week, having received ‘Best Environmental Excellence Award’ at the 6th CSR Summit Awards for its commitment to environmental accountability and sustainability

DUBAI REAL TIMES

Eng. Hussain Nasser Lootah, Director-General of Dubai Municipality said the Municipality’s winning of the second place in the International Awards for Livable Communities in the group of cities that has more than 750,000 people is further evidence of the extent of the Municipality’s efficiency and excellence in this vital area.

It is the world’s only competition for local communities, focusing on environmental management and the creation of active vibrant communities

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MOVERS & MERGERS

Board named for Dubai Logistics Corridor HH Sheikh Ahmed bin Saeed Al Maktoum and HE Sultan bin Sulayem witness a major agreement

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DUBAI REAL TIMES

conomic Zones World (EZW) and Dubai Aviation City Corporation (DACC) recently announced the creation of a board for the development and implementation of the ambitious Dubai Logistics Corridor (DLC), planned to be the world’s largest multi-modal logistics platform.

Under the agreement, witnessed

by His Highness Sheikh Ahmed bin Saeed Al Maktoum, Chairman, Dubai Aviation City Corporation,

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and His Excellency Sultan Ahmed bin Sulayem, Chairman, Dubai World the parent company of EZW; Salma Hareb, Chief Executive Officer, EZW, and Rashed Buqara’a, Chief Operating Officer, DACC, were appointed members of the board.

Two more members, one each from EZW and DACC, will be nominated at a later date.

The board will formulate a longterm plan to ensure the sustained development of DLC and the

alignment of its concept with national economic objectives. In the short term, this will involve overseeing the four areas of collaboration, including: Development and implementation of common business processes to benefit customers by enabling a seamless and fast transaction turnaround for goods and freight passing between the two adjacent locations The development of one-stop-

shop services, including registration, licensing, and management of human capital Development of an operational platform, setting out consistent rules, regulations and offerings Focus on business development, where the two entities would align their respective capabilities in areas of marketing and promotion. This will result in a more synergistic and effective approach to acquiring new customers by promoting a unified offering.

Director changes at DP World

Raymond Crane Is Managing Director of Engineering at RMJM

DP World Limited announces the following changes to the board: Yuvraj Narayan will step down as Chief Financial Officer at the board meeting on 10th December 2009, when he joins Dubai World, taking on the role of Group Chief Financial Officer. The board of DP World has commenced search for a new CFO and a further announcement will be made in due course.

Mohammed Sharaf, CEO of DP World said: “Yuvraj has been involved in the dramatic growth of DP World and has been instrumental in building our strong balance sheet.

We wish him well in his new role at Dubai World.”

As was announced on 18 September, Jamal Majid bin Thaniah, Executive Vice-Chairman of DP

The Dubai office of the architectural firm RMJM has announced the appointment of leading structural engineer Raymond Crane as their new Managing Director of Engineering. He has worked on major building projects around the world with particular experience in tall structures and those with a major urban impact. His experience of living and working in New York, Hong Kong, the Middle East and Asia have given him an appreciation for the benefits of diversity, looking beyond conventional boundaries and developing new project delivery methods.

Raymond joins RMJM from the Abu Dhabi office of Arup where he played a lead role in the structure of landmark projects such as the Dubai Towers in Dubai. The company’s Dubai engineering team has nearly four decades of hands-on experience and an unrivalled portfolio of iconic projects. His focus will be to encourage the team to push the limits of

Yuvraj Narayan

World Limited, has been appointed as Group Chief Executive Officer of Dubai World. Jamal, therefore, becomes Non-Executive Joint Vice -Chairman of DP World Limited. He will continue to play a pivotal role in the development of DP World supporting both the board and the company.

New project director for Tiger Woods Dubai Dubai Properties Group has named Mohammed bin Essa as Project Director for the 55 million square foot Tiger Woods Dubai golf community, following Abdulla Al Gurg leaving the position to take up the role of Group General Manager for the Easa Saleh Al Gurg Group.

Bin Essa was previously the General Manager for strategic business development and risk management at Majid Al Futtaim Properties before being appointed Director of Operations for Dubailand, a position in which he will continue.

design, and develop a more culturally diverse workforce to match the needs of clients across the region.

Raymond will introduce a new Project Delivery Model to the team, aimed at ensuring a greater integration between design and delivery.

Experience has also shown RMJM that collaboration between architects and engineers from the earliest conceptual stage is key to the successful delivery of world-class structures.

Raymond Crane

UNDER CONSTRUCTION

Almost there Hircon’s 23 Marina’s first, fully-fitted show apartment was launched recently. Mr. Alkesh Tandon, Managing Director of Best Interiors, was pleased with the end result of his complete outfitting of the apartment with its variety of suggestions for family living glut of towers in Dubai are completed theirs will stand tall next to the competition in offering the quiet life with exclusive residential addresses and privacy that multi-use skyscrapers cannot.

What currently makes the building stand out from the masses is the 57 swimming pools it has on offer to residents. Each of the duplex apartments will have an L-shaped plunge pool 5.2 metres by 2 metres located on their projecting triangular balconies.

The company saw initial works on site begin in July 2006. The scale of the scheme has proven to be enormous with the 150,000 man hours of work, 1,400 tonnes of steel and 7,000 cubic metres of concrete just to build the main three metre thick concrete raft and foundations that the building will sit on.

The scheme is now rapidly growing and, at current rates, should see residents moving in sometime in 2010.

Hircon is a joint venture between India's Hiranandani Developers and ETA Star Properties.

They tied up to develop 23 Marina, a 90 level luxury project in the Dubai Marina.

As India's ambassador, Hiranandani has been dedicated to the mission of creating not just homes, but better communities.

Hiranandani is a wellrespected and leading name in the Indian construction industry for its opulent townships that have changed not just the landscape, but also the level of expectations of the lifestyle Indians aspire to live. The group is known for its unique showcase residential townships in Mumbai that has brought global living to India.

Update on Hircon’s website on 22 November shows supporting photos and states: • Core wall is completed up to 79th level and works are on at 80th level.

• Peripheral slab work is in progress at 77th level.

• Curtain wall is in progress at 44th floor and ACP cladding is in progress at lower levels. Marble wall tiling works are in progress at 28th floor.

• Marble flooring works are in progress at 42nd floor.

• False ceiling works in progress at 52nd floor.

• Fire Fighting piping at 56th floor.

• Gypsum partition at 57th floor.

• Drainage rises at 60th floor.

• HVAC Duct rises at 60th floor.

DUBAI REAL TIMES

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ircon International plans to hand over units in its 23 Marina a Dh1.3-billion project in Dubai Marina by June next year, a senior company executive said.

“There will be a phased delivery of units in the tower, starting from March. We expect to complete the handover by June,” Darshan Hiranandani, Director, Hircon International, told Dubai Real Times.

Hiranandani said launching a large number of projects was never the company focus as it believed in completing one project at a time.

“This policy of ours has actually saved us. The number of defaults too are very few, and in those cases we have managed to resell such units as well.”

23 Marina is a 395 metre tall residential building, now under construction, that will rise 89 floors above ground. It’s been designed by the International Building Centre with roughly octagonal floorplates and a 64 metre tall spire above the main structure that helps turn it into what looks like a giant pencil with cladding of blue and white.

23 Marina is being developed

by Hircon International who have deliberately rejected the multi-use concept that many of Dubai’s taller towers enjoy, going for a solely residential building with 288 apartments and only a few extra facilities such as a three storey spa which will, of course, be for the exclusive use of the occupiers.

Hircon believe that once the initial

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UNDER CONSTRUCTION

Tall towers and community plans Not only are new projects being started, but the ongoing ones are speedily getting ahead with their concrete pours, dismantling of cranes and fit-outs

DUBAI REAL TIMES

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ameer Holding Investment LLC is progressing well on its prestigious Princess Tower, the world’s highest residential skyscraper located in Dubai Marina. Construction is progressing according to the master schedule and has reached floor level 65 and core level 75.

Commenting on the excellent progress of the project, Federico Tauber, President of Tameer Holding Investment stated, “The Princess Tower once complete, will be a significant landmark in the Dubai Marina area and the country, and we are committed to ensuring the success and timely delivery of this project.

Residents will have a panoramic view of the surrounding area and the endless horizon. An abundant amount of private parking spaces are provided for occupants however, for those that prefer to use public transport, the Al Sofouh Tram will have a line adjacent to the building.”

Occupying an area of 37,410 square feet, the tower houses a large selection of luxury two, three and fourbedroom residential apartments, duplex villas and high-end penthouses.

The 107 floors of the tower are a com-

Sanctuary Falls

bination of luxury apartments, retail sales outlets, sports and recreational clubs. It offers its customers state-ofthe-art facilities, high-quality finishes, well-designed interiors and a wide range of recreational facilities Shaikh Holdings has made substantial construction progress on its award-winning golf development Sanctuary Falls. The developer has achieved significant milestones over the past 18 months, and has been working diligently to build the 99 villa community and deliver on its commitment to its residents. Overlooking the Earth Course at Jumeirah Golf Estates, Sanctuary Falls provided a dramatic backdrop for the Dubai World Championship, which was held last month.

With the villas now at various stages of construction, from main concrete works to internal finishing, the streetscape of Sanctuary Falls has started to take shape. The current onsite construction workforce stands at 1,800 with an additional 200 workers expected by year-end. The final finishes are currently being applied to the first show villa which will be fully completed and unveiled soon, while the remaining villas are on schedule Remraam

Bird’s eyeview from Princess Tower Core Level 75

for completion, starting early 2010.

Remraam, a development of Dubai Properties Group, has announced construction work at its 22.6 million square feet community is achieving consistent and scheduled progress across all phases of the development, including external finishes. Contractors, working simultaneously on all aspects of the community, have completed 30 per cent of superstructure works with 36 per cent of the buildings having reached the fourth floor. Infrastructure work throughout the development is progressing as scheduled, with a notable 70 per cent completion rate. Work on Remraam’s dedicated 132 KV power substation is also underway, in line with the proposed timeline.

The architectural design elements and community aesthetics are taking shape as internal and external finishes progress on site. Exterior paint works and decorative metal work is currently being installed on the building. In addition, block and plaster work have been completed on several buildings and the application of wall tiles has commenced.

The Arabian-themed Remraam features low-rise architecture, high

quality standards and an outstanding location within Dubailand. When completed, this will be a self-contained community, offering landscaping over 85 per cent of the development and a gamut of facilities.

Memon Investments has completed nine out of the ten floors within Cambridge Business Centre (CBC), its inaugural commercial venture located in Dubai Silicon Oasis.

The continuous construction works on the Dh80 million tower is leading up to its expected timely delivery.

With a total built-up area of 160,000 square feet, CBC is the first project in the region comprising 10 floors that are all dedicated to commercial space. Memon Investments has partnered with several leading construction partners for this project, with Cairo Contracting Company bagging the main contract for the business tower; Win Gate Electromechanical Services providing topquality materials and delivering complete electrical, plumbing, drainage, fire fighting and fire alarm works; and Stromek Emirates Foundation, which is in charge of shoring and excavation works. Further, Hi-Tech Electro Mechanical Contracting Est. and ShangCambridge Business Centre

withstand 120km/hour winds. Typical cargo included welding equipment, scaffolding, reinforcement bar cages, steel link beams that weighed up to 20-tonnes, shuttering pieces, compressors, hoist masts, cladding panels, and custom-made elevator motors – in short, everything that is needed to build the world’s tallest tower.

In all, the three cranes lifted over 63,300 tonnes of steel reinforcement, and were operational for a total of 45,000 man-hours. A team of 35 skilled technicians manned the cranes. The operators of the cranes worked at dizzying heights of more than 700 metres, almost double the height of the Empire State Building.

Mr. Abdullah Lahej, Executive Director, Dubai Project Management, Emaar Properties, said: “No highrise construction project has moved the same volume of materials as Burj Dubai or to the same heights. The way tower cranes have been used to complete the world’s tallest tower is unprecedented and writes a new chapter in super-tall tower engineering.”

He said: “Managing the effects of wind speeds and the unique design challenges involved in realising the Burj Dubai’s slender structure was an extreme test. Each aspect of the construction was analysed to ensure maximum safety, efficiency and ease of operation – and the steady progress of the tower’s construction is a testament to the team’s exceptional commitment and abilities.”

Final work on interiors and landscaping is underway as the Burj Dubai prepares to open on January 4, 2010 to coincide with the Accession Day of His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President & Prime Minister and Ruler of Dubai.

Landscaping at The Galleries at Downtown Jebel Ali is taking on a new dimension, with construction

Construction of the amphitheatre comes as Limitless marks the third anniversary of the launch of Downtown Jebel Ali

of a 300-seat amphitheatre and 105 square metre screen now underway at the mixed-use community project in Dubai, master developer Limitless has announced. The amphitheatre will be a venue for cultural, arts and social events, and the focal point of The Galleries’ 20,000 square metres outdoor landscaped plaza, which also features 200 trees, lawns, fountains, pools and shaded spots for relaxation. The screen will be housed in a steel structure which, at 288 square metres, is about the size of a tennis court.

Construction of the amphitheatre comes as Limitless marks the third anniversary of the launch of Downtown Jebel Ali, its 200 hectare mixeduse, master planned development on Sheikh Zayed Road. The Galleries – an eight building complex of offices, apartments, retail and leisure facilities – is the first community project within Downtown Jebel Ali. A-grade office and retail space is available for lease in The Galleries’ first four commercial towers, while residential accommodation will be online in the first half of 2010. Landscaping is scheduled for completion in early 2010, when a mosque for 500 worshippers is also due to break ground.

Under the patronage of His Highness Sheikh Ahmed bin Saeed Al

Maktoum, Chairman, Dubai City of Aviation Corporation - Dubai World Central, Aramex today broke ground on its new Logistics Centre, located in Dubai Logistics City (DLC). The Dh120 million Aramex facility encompasses a built-up area of over 43,000 square metres, situated on a 140,000 square-metre area of land, and is due for completion in the first quarter of 2011. The logistics centre is strategically located next to the Jebel Ali Port and Free Zone, complementing Aramex’s product offering of total transportation solutions.

The environmentally friendly features of the Logistics Centre are in line with Aramex’s sustainability strategy and practices. The centre is being built with advanced technological systems and fittings for enhanced energy conservation. These include the use of an energy-saving water cooling system, channeling waste water for irrigation purposes, and the installation of sophisticated lighting sensor systems.

The new Aramex Logistics Centre has capacity for more than 40,000 pallet locations and a specialised terminal dedicated to express air cargo, sea cargo and land freight shipments, serving the full spectrum of Aramex solutions. Aramex also has additional land at the site to increase capacity at a later stage.

(from left to right) Khalifa Al Zaffin, Executive Chairman, Dubai World Central; Fadi Ghandour, Founder and Chief Executive Officer, Aramex; His Highness Sheikh Ahmed bin Saeed Al Maktoum, Chairman, Dubai City of Aviation Corporation Dubai World Central; Hussein Hachem, CEO-Gulf, Aramex

DUBAI REAL TIMES

ntre

hai & Arabian Electromechanical LLC, are also part of this massive project, installing York air-conditioners and three high-speed elevators, respectively.

Rizwan Shaikhani, Joint Managing Director, Memon Investments said, “Construction of CBC is progressing rapidly, and we are now preparing for the handover of the offices to our investors. We are proud to be close to delivering this project despite the drawbacks of the current recessionary period.”

Inspired by classic British architecture, CBC will offer small, medium and large offices that are fully equipped with technologically advanced facilities such as Wi-Fi technology, keyless entry and hi-speed internet connection and a fully-serviced health club at the rooftop.

Burj Dubai, the world’s tallest building, which is being developed

by Emaar Properties PJSC, is nearing completion, following the dismantling of the last high-altitude crane used in the tower’s construction. Having also completed the external cladding recently, the Burj Dubai construction team is now concentrating on the interiors and landscaping.

Mr. Mohamed Alabbar, Chairman, Emaar Properties PJSC, said: “The sheer size, scale and architectural detailing of Burj Dubai demanded an unprecedented degree of engineering innovation. Working at great heights involving the use of massive cranes has been one aspect of the challenge. Dismantling the cranes is an exciting development because it shows that completion of the world’s tallest tower is just around the corner.”

Three huge tower cranes were used in moving construction materials up to Level 156 of Burj Dubai. The cranes could each lift a staggering 25-tonne load and were designed to

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HANDOVERS

A schedule of handovers

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he big names in developments are making plans to hand over their projects.

Homes and offices are scheduled to be given to those who have bought them, while homes that have been completed are being handed over to their owners in phases right now.

Nakheel, Dubai’s master developer, has commenced handover of homes at Marina Residences, Palm

set to enjoy the best of what Palm Jumeirah has to offer with gorgeous homes, stunning views, world-class hotels and entertainment on their doorstep. At Nakheel , our focus is on delivering quality communities and this handover marks another major milestone on Palm Jumeirah. Going in to the new year, we are pleased to welcome more and more families into this growing community.”

The waterfront development

DUBAI REAL TIMES

Marina Residences, Palm Jumeirah

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Jumeirah. The phased handover of 980 units at Marina Residences, located at the tip of the island’s trunk, will continue until early next year.

It marks another great milestone in the development of Palm Jumeirah, with more than 2,000 new residents to be welcomed to the community during this process.

Marwan Al Qamzi, Group Managing Director, Nakheel Development Projects said: “Palm Jumeirah remains a sought after location in Dubai and residents at Marina Residences are

features six residential towers containing 980 units, 940 of which are a mix of apartments and penthouses.

The most luxurious penthouses are designed over four floors, providing more than 14,000 square feet of living space. The development is complemented by 40 townhouses which are located along the marina fronted promenade.

Palm Jumeirah is now home to more than 12,000 residents. However the project is still ongoing and the next five to six years will see the

island become one of the world’s premier resorts, offering a number of top-brand named hotels, including Atlantis, which opened in September 2008, as well as a wealth of retail and leisure choices, offering the ultimate luxury Markus Giebel retail, dining and entertainment destination.

Further demonstrating its continued commitment to its customers, Deyaar Development PJSC, a regional real estate company dedicated to innovation, customer care and long-term sustainable growth, has announced that it will hand over six projects in 2010, including premier developments in Dubai’s master planned communities. The handover will include five projects in the Business Bay master development and one project in International Media Production Zone (IMPZ).

Of the projects scheduled for delivery next year, five are residential properties, while one is commercial.

The first project to be delivered in 2010 will be Hamilton Residency, a premier residential tower located in Business Bay, scheduled for delivery in the first quarter. This will be followed by the delivery of four projects in the third quarter of 2010. These include Mayfair Tower and Mayfair Residency, both contemporary residential towers located in Business Bay. The other two projects to be delivered in the third quarter will be Clayton Residency, located in Business Bay, and Oakwood Residency, located in IMPZ.

The fourth quarter of 2010 will see the handover of ‘51@Business Bay’, a state-of-the-art commercial tower located in Business Bay. Deyaar’s handover schedule for 2010 was announced at Cityscape Dubai 2009 in October. All properties offer a wide range of superior amenities and the highest construction quality.

“The hallmark of Deyaar’s success and indeed one of its key differentiating factors amidst these challenging conditions has been its commitment to its customers and focus on highquality real estate projects whose value as an investment-grade product will endure over many years,” said Markus Giebel, Chief Executive Officer of Deyaar.

“As the business and investment paradigm for the regional real estate sector undergoes a structural shift due to global economic trends, Deyaar has already adopted a strategic approach that has enabled it to streamline its portfolio and focus on long-term value proposition for endusers and investors. The announcement of our handover schedule for 2010 is in line with this guiding strategy and reinforces our continued commitment to transparency and customer service excellence.”

INTERIOR DESIGN

came many challenges in order to fulfil the request. Firstly, the layout required a comfortable fit for over 100 staff, with each departmentalised team having to be grouped together and positioned in a productive seating arrangement for optimum employee performance. As the original design of the space was for a food court, the design team had to make numerous modifications, including moving large industrial air conditioning units in order to reduce the noise

Neocasa unveils ‘The Loft’

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ednesday, 14 October, marked a milestone in the interior design world as Neocasa, a collaborative platform of industry leaders with a passion for great design, unveiled ‘The Loft’, the ultimate in style-led living.

Neocasa is the brainchild of Shahriar Khodjasteh, Group Marketing Director of Al Aqili Furnishings. The forum has been established not only to reflect the very best in contemporary interior design but also to offer a canvas for locally established interior designers and the opportunity to show off their skills and talent, creating comprehensively furnished living spaces, for complete style and living solutions.

Located in Murjan Towers, Jumeirah Beach Residence, The Loft is the official opening showcase for Neocasa. Chris Barnes of Broadway Inte-

in the office areas,” commented Arthur Villanueva, Senior Interior Designer Summertown Interiors.

Additional layout challenges required modification such as re-routing the plumbing and drainage lines in conjunction with DOZ, TECOM & Zoning Authority. The restrooms were also restructured to accommodate the mainly female staff.

Ahrend furniture was extensively used, as it met all of AXA’s requirements for ergonomics and flexibil-

ity. These multi-functional tables and chairs could be configured according to employees’ height and body size, promoting productivity and efficiency.

The end result was the multi-functional call centre which allowed for open communication between employees as well as providing them with their own personal space and comfort.

The AXA Insurance call centre has an industrial look with a warm modern feel, while still reflecting the AXA corporate branding.

A celebration of design

riors was invited to create a home that would reflect an affluent individual’s fashion and personality through a living environment. The finished result is a testament to this – the property exudes the style and taste reflective of the modern-day executive, having contemporary furniture and fittings of the highest quality, fresh and forward artwork, all the latest in up-to-date appliances and home automation technology, plus a cutting-edge gymnasium. Throughout the interior, Chris has also chosen to infuse an Arabic twist to the design to reflect the culture of the region.

Spearheaded by Al Aqili Furnishings, the project brought together top brands that exemplify the best in their field to fit out and furnish a home.

There is a Porsche Design kitchen by Poggenpohl with a sub-zero built-in refrigerator. The audio-visual

technology and home automation was provided by Dubai Audio Centre featuring luxury Loewe televisions, while the mirror TVs in the bathrooms came from Ad Notam. The contemporary furniture is i4Mariani from Italy, and the beautiful paintings are by Hengameh Mahvi.

The importance of exercise has not been forgotten either, and Technogym, the world leader in the design of fitness equipment, has installed a treadmill which, when not in use, folds up to just one metre squared, as well as the KinesisTM Personal, which offers 400 different exercises.

Soft furnishings were sourced from Al Aqili Furnishings own portfolio, which consists of 57 international brands. Flooring came from their Carpetland division, automated blinds and curtains from Curtainland, and sophisticated lighting from Belight.

Chris Barnes said, “From the outset we wanted to use the best products, fittings and accessories available without the overall effect being excessive or overly flamboyant. We used Al Aqili Furnishings’ products because they had a wide portfolio that fit with the vision of the project, not because we were obliged to do so.”

Subsequent projects are already in the planning stages. Shahriar said, “We want Neocasa to be the platform that brings together the region’s most creative designers and give professionals a blank canvas on which they can showcase their artistic abilities and vision without constraint. The projects will enable designers, design-forward brands and those interested in design to mingle, view the works of other designers, gain inspiration and expertise, and work together to create future masterpieces.”

DUBAI REAL TIMES

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ummertown Interiors, the international corporate turnkey interior fit-out contractor, has completed the AXA Insurance multi-functional call centre on schedule. The client brief indicated that the 650square metre area needed to be turned into an efficient call centre, including amenities such as meeting rooms, prayer room, storage areas, employee restrooms, and pantry.

“Summertown successfully over-

Interior of multi-functional call centre completed on schedule

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FOCUS

Buildmart in Dubai Festival City New retail showroom marks Danube Building Materials’ first branch within a mall

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E. Eng. Hamad Buamim, Director General, Dubai Chamber of Commerce & Industry, inaugurated the Dh10 million ‘Danube Buildmart’ in Dubai Festival City, which marks Danube Home Interior’s first retail showroom to be based within a mall. This latest venture will cater to individual homeowners and designers, and is part of the construction, building materials and shop fitting industries leader’s Dh50 million expansion plans for its retail complex chain, which also involves the opening of additional branches in Ibn Battuta Mall in Dubai and Bawadi Mall in Al Ain by the end of 2009. Mr. Hassan Al Hashemi, Director, External Relations, Dubai Chamber, was also present at the event

along with Danube officials.

“I welcome the opening of Danube Buildmart’s showroom in Festival City, which reflects the investors’ continued trust in Dubai,” said Buamim.

Spanning an area of 4,500 square feet, the store offers products from a host of reputed international and regional vendors under a single roof, including goods such as chandeliers, wall paper collections, luxury sanitary ware, Venetian blinds, wooden flooring and home decor among others.

At present, there are five retail outlets under the ‘Buildmart’ banner. Expansion plans involving the launch of a flagship branch along Sheikh Zayed Road and an additional branch in Fujairah are also on the pipeline.

Dubai International Cricket Stadium is “sensational” Former Australia captain impressed after visit to the venue: “It’s a fantastic facility, among the best I’ve seen”

DUBAI REAL TIMES

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teve Waugh, former Australia captain has seen most things in cricket over the course of an international career spanning almost 20 years. But he was still mightily impressed after a visit to the Dubai International Cricket Stadium at Dubai Sports City on Tuesday, labelling the venue “sensational.”

Waugh, who won two ICC Cricket World Cups in 1987 and 1999 captained Australia to a record-equalling 16 Test wins in a row; and who was recently inducted into the ICC Cricket Hall of Fame, said after his visit: “It’s a fantastic facility, among the best I’ve seen. With a venue like this it would be great if there could be more

cricket played here and I know that if more cricketers see it then they will want to play here. It’s sensational.”

Waugh’s wish for more cricket at the 25,000-seat capacity venue has been fulfilled with the PakistanNew Zealand Twenty20 International (T20I) last month.

Khalid Al Zarooni, President, Dubai Sports City, said: “We are delighted to have had the chance to show Steve around our facilities and we are equally delighted to know he was impressed.

Waugh also visited the soon-tobe-completed ICC Global Cricket Academy and added: “What is being put together is world-class.”

Steve Waugh with Maqbul Dudhia, Dubai Sports City’s General Manager for Sports Business, at the Dubai International Cricket Stadium

Dubai Silicon Oasis Authority Receives ISO-27001:2005 Certification

Turning around troubled projects

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Seminars to present recommendations on better and faster risk management decisions as slowdown hits $200 billion in hydrocarbon projects

ubai Silicon Oasis Authority (DSOA) has received I S O -270 01: 2 0 0 5 certification for implementing global standards for the Information Security Management Systems (ISMS) at the high-tech business park. TÜV SÜD Management Services GmbH of Germany, a leading international service organization catering to the strategic business segments industry, mobility and people, awarded the certification after stringent quality inspections at Dubai Silicon Oasis (DSO).

ISMS is a systematic approach to managing and ensuring the security of critical information and data. Commenting on this occasion, Abdulsalam

Al Bastaki, Director of IT and Services at DSOA, said: “As an internationally recognized technology park, we implement top-notch quality standards in all our areas of operation and the ISO certification adequately demonstrates our status as a widely acclaimed global organisation.”

Interfaceflor opens new regional workspace

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nterfaceFlor, a worldwide leader in the design and manufacture of environmentally responsible modular floor coverings has opened its new regional headquarters in Dubai while celebrating 15 years on the path to Mission Zero – the company’s bid to achieve a zero environmental footprint and become the world’s first sustainable business by 2020.

The new 250 square metre workspace will serve as the company’s regional headquarters.

The office space together with a cutting edge

design showroom incorporates many sustainable elements including InterfaceFlor’s newest range of carpet tiles using Convert – a yarn system which offers a high level of post consumer recycled content on the surface, lighting controls with daylight censors and occupancy control, water consumption reduction measures such as low flow fixtures and furniture with the highest content of recycled material available.

Neel Bradham, Senior Vice President of InterfaceFLOR Europe, Middle East, Africa and India, said, “A waste reduction programme has InterfaceFLOR's new workspace in Dubai is aiming for LEED Gold Certification allowed us to generate over $405 million in avoided costs, energy efficiency programmes have resulted in a 67 per cent reduction in greenhouse gas emissions since 1996, and a commitment to renewable energy and changes to the production process have allowed for 100 per cent of renewable electricity in manufacturing processes throughout Europe.”

Raed S. Haddad

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est practices on how to turn a troubled project around and make better and faster risk management were outlined at a series of seminars in Qatar, Egypt and the United Arab Emirates.

“With budgets squeezed ever tighter and deadlines being pushed, project managers have to cut down on the unexpected surprises which put projects at risk,” said Raed S. Haddad, Senior Vice President of Global Delivery Services at ESI International.

Illustrating the scale of the task, Haddad cited a recent report by research house Proleads Global showing more than $200 billion worth of projects on hold or cancelled in Gulf Arab countries in the oil, gas and petrochemical sectors.

“With success rates only around 40-50 per cent there is certainly plenty of room for improvement. To be sure, studies have shown that using a structured risk management approach can improve project success and reduce subpar performance. In a highly competitive business world, unrecognised, unplanned for, and unmitigated risks could sink a project, a company, or even a career,” Haddad said.

DUBAI REAL TIMES

Sustainability leader aims for LEED Gold certification and supports the World Interior Design Congress in Dubai.

Celebrates 15 year milestone on journey to Mission Zero

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Tackling fire fighting, safety and rescue issues In the UAE this year, a total of 1,543 fires occurred, causing 30 deaths and 115 injuries across the country, according to official figures

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ccording to the Abu Dhabi Civil Defence Directorate, in order to curb these fire outbreaks, building owners need to follow the mentioned fire safety procedures and regulations on a frequent basis. Fire fighting and rescue concerns will be debated and highlighted at the Intersec 2010 trade event, taking place from January 17 to 19, 2010, at the Dubai International Convention and Exhibition Centre.

“The high number of fire incidents in the country, causing significant losses in life and property, has sparked a series of emergency response procedures and exercises from the regional authorities, organisations and experts,” said Ms. Elisabeth

Brehl, Managing Director of Epoc Messe Frankfurt GmbH, organisers of Intersec 2010.

Ms. Brehl added, “The Gulf region is one of the most challenging markets for the industry of fire fighting, fire prevention and rescue worldwide.”

The Civil Defence has inspected 5,300 buildings so far this year, including 1,105 residential properties, and the vast majority were found to have poor fire equipment, lacked smoke alarms, had faulty central gas systems or had inaccessible emergency exits.

Intersec 2010 will, for the first time, present an industry-led approach to major topics in the fire fighting, fire prevention and rescue industries.

Stop that cab!

Media One Hotel Welcomes Dubai Taxi Drivers

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Media One Hotel greeted some of the taxi drivers outside the hotel

s part of its pre-opening campaign to raise awareness of the property’s location, Media One Hotel invited Dubai taxi drivers to visit the hotel in order to get acquainted with its location in Dubai Media City. Working closely with the RTA, Media One Hotel successfully welcomed almost 700 taxi drivers over a two day period.

For his part, Yousef Al Madani Director of Transport Systems at RTA’s Public Transport Agency said: “On

behalf of the RTA, we think this is a great initiative by Media One Hotel, as it undoubtedly supports RTA’s efforts in better serving the taxi customers in Dubai.

“So often drivers are coping with identifying new hotels, venues, roads and they cannot expect to know every single location across Dubai without our help,” said Cora De ConceicaoStuart, General Manager of Media One Hotel.

GCC demand for sun protection and door systems R+T Middle East 2010 opens pioneering trade platform for shutters, sun protection, rolling doors and garage doors in MENA region

DUBAI REAL TIMES

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+T Middle East, the only professional trade show dedicated to shutters, sun protection, rolling doors and gates in the MENA region, will make its highly anticipated debut from May 10 to 12, 2010, at the new exhibition halls of the Dubai International Convention and Exhibition Centre (DICEC).

The GCC in particular has been a key target market for R+T Middle East with the exceptionally large number of projects under construction in the region; from 2009 to 2011 alone, the combined expenditure in the UAE,

Saudi Arabia, Kuwait and Qatar has been estimated to reach more than $1.1 trillion, driving demand for specialised sun protection, doors/ gates and access control systems.

R+T Middle East is jointly organised by Deutsche Messe Dubai Branch and Messe Stuttgart, offering a comprehensive selection Angela Schaschen of technical innovations from global suppliers and opening opportunities

for both exhibitors and visitors to synergise and strengthen strategic partnerships.

Angela Schaschen, Managing Director, Deutsche Messe Dubai Branch, said, “We are creating greater value for trade visitors and exhibitors by organising the region’s pioneering trade event for sun protection, doors/gates and access control systems. The exhibitions underscore our continuing commitment to address the expanding requirements of the niche markets we serve.”

Minister backs Middle East’s first test furnace State-of-the-art facility fire tests construction products to ensure compliance with regulations making buildings safer

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he Middle East’s first furnace for testing and certifying fire rated doors and partitions used in the construction of all commercial, public, office and multi-family buildings has received its accreditation from the national accreditation body for the United Arab Emirates, the Emirates National Accreditation Service.

The accreditation certificate was presented by HE Dr Rashid Ahmed Bin Fahad, Minister of Environment and Water and Chairman of the Emirates Standardisation and Metrology Authority (ESMA), to Thomas Bell-Wright International Consultants of Dubai, to highlight the availability of proper fire testing facilities for the region’s construction industry.

The Minister said: “Accreditation of this laboratory provides confidence in the market and further enhances the infrastructure of quality for assuring safety and conformity of products and services.”

Engineer Mohammed Saleh Badri, Acting

Director General of ESMA, added that the new facilities are critically important tools in ensuring buildings are properly constructed.

Tom Bell-Wright, founder and CEO of Thomas Bell-Wright International Consultants, said: “There have been many major fires over the last few years and hopefully the presence of this testing furnace will now make it easier for builders to comply with the regulations and help make our buildings safer to live and work.”

The fire testing furnace is now fully operational with accreditation under ISO 17025 from the UK Accreditation Service and now the Emirates National Accreditation Service, a part of ESMA. HE Dr Rashid Ahmed Bin Fahad, Minister of Environment and Water and Chairman of the Emirates Standardisation and Metrology Authority (ESMA), presented the accreditation certificate to Tom Bell-Wright, CEO of Thomas Bell-Wright International Consultants, at the laboratory in the Ras Al Khor area of Dubai

Wet projects ET, In addition to previous projects including Jewelry Trade Center (Bangkok), Canal City Hakata (Japan) to the Bugis Junction (Singapore), the San Ji Cheon (Korea) the Marina Mall (Abu Dhabi), has multiple projects on the horizon in the Asian market. In Dubai, it is responsible for Dubai Fountain at Burj Dubai. The engineering and entertainment marvel uses the most innovative technologies, unmatched anywhere in the world, moving the needle on watercentric design-meets-entertainment experiences.

Key Facts & Figures • Situated prominently in front of the world’s tallest manmade structure Dubai Tower, The Dubai Fountain is a thirty-two-acre animated lake – equivalent to that of over two football fields – and is, by any measure, the largest choreographed fountain in the world • WET’s use of projected light allows for the fountain to be visible from over 20 miles and even from space • Powerful water nozzles shoot wa-

ter sprays to a record-setting 150 metres in the air – equivalent to that of a 50-storey building • The Dubai Fountain has over 22,000 gallons of water in the air at any given moment • The fountain performs its reper-

toire of over 1,000 individually choreographed elements to international music selections • A complex water feature such as this typically requires three years from start to finish; WET and the Emaar team were able to finish the

project in just 18 months The meaning of the word fountain does not capture what WET creates: works of art, dramatic spectacles and entertainment that transforms how people connect with nature and each other.

DUBAI REAL TIMES

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ENVIRONMENT

Debating about desalination

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aking the salt out of water and making it useable is not an easy thing to do throughout this world of ours. It can be done, that’s true, and in a variety of ways too, but at what cost, both

financially and morally? In this unequal world of have and have-nots, who should help whom to look after this precious commodity?

His Highness Sheikh Majid bin Mohammed bin Rashid Al Maktoum,

Chairman of the Dubai Culture and Arts Authority, officially opened the International Desalination Association (IDA) World Congress 2009 on Desalination and Water Reuse last month and presented the IDA World

Water Masters Award to Dr. Farouk Al Baz, Research Professor and Director of the Centre for Remote Sensing at Boston University for his extensive research and significant work in groundwater storage and recovery.

Fady Juez

DUBAI REAL TIMES

HH Majid bin Mohammad bin Rashid Al Maktoum

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His Excellency Dr. Rashid Ahmad bin Fahad, UAE Minister of Environment & Water, Salma Hareb, CEO Economic Zones World, and Lisa Henthorne, President of the IDA, at the official opening of the exhibition which took place alongside the IDA World Congress 2009 was inaugurated by His Highness Sheikh Majid bin Mohammed bin Rashid Al Maktoum, Chairman of the Dubai Culture and Arts Authority

Metito, the international water desalination and wastewater treatment specialist, announced that Fady Juez, the Managing Director of Metito, has been elected to the Board of Directors of the International Desalination Association (IDA). This appointment comes after an election process involving many representatives of global leaders in the water desalination industry and is a result of Metito’s numerous contributions to the desalination sector.

Patricia Burke, Secretary-General of the IDA, comments: “Metito has been among the top five global desalination companies for many years now and has contributed endlessly to this sector of the market. With over 30 desalination plants around the world and Metito’s constant support to the desalination community, it came as no surprise that Fady Juez would be elected.

the country with a capacity of 1.3 billion cubic metres a year, which meet 98 per cent of the household and industrial water demand.

“Nevertheless, the demand for water remains high. Future projections indicate that demand will rise from five billion cubic metres to seven billion cubic metres in 2020,” he said.

“Despite the advances in water desalination, the industry still faces technical, economic, and environmental challenges, especially from the effects of rising temperatures. In order to mitigate climate change, the UAE has adopted the option of using nuclear and renewable energy in desalination processes,” he added.

Lisa Henthorne, President of IDA said: “Desalination and water reuse offer our growing population what nothing else can - an abundant source of fresh water through which our health can be maintained, our

gies. A key community concern associated with desalination, particularly seawater applications, is the energy demand to drive the process and emission of greenhouse gases. Similarly, plant intakes and concentrate discharges, if not checked, may adversely affect coastal waters and marine life.

Avista Technologies launched an array of new products as their laboratories continue formulating a variety of new chemicals. Danfoss RO Solutions, selling compact and energyefficient high pressure pumps for Seawater Reverse Osmosis systems introduced an even more breakthrough innovation at the exhibition.

Koch Membrane Systems, Inc. (KMS), a pioneer in membrane technology filtration systems, engineering and process expertise for close to half a century, launched its new solution for large capacity seawater RO projects.

Global experts and local stake-

ticipants representing federal and local governments, academies, institutes, organisations, environment authorities and the private sector. The session themes were highly focused, each coming up with clues to solutions for the issues and suggestions for implementation. The subjects covered included Desalination & Environment, red tide, alternative energy in desalination, desalination operations & monitoring policies; and integrated water management.

The workshop also urged enhancement and improvement of environmental legislation on pollution.

The panel called for additional attention to be given to the issue of postdesalination flow of salt into sea and harmful gas emissions. The experts also urged adapting best practices in the desalination industry.

TechnoPark, the Economic Zones World subsidiary, extended its commitment to sustainable water

A Memorandum of Understanding has been signed by TechnoPark, the Boston University Centre for remote sensing and Concorde-Corodex Group

economies can prosper, our standard of living can be enhanced, and water can be recycled repeatedly, thereby minimising our environmental footprint on the planet.”

Industry specialists at the exhibition launched the latest scientific and technological breakthroughs in desalination and water treatment. New innovations and ideas to reduce the environmental footprint of desalination were showcased, in addition to new reverse osmosis (RO) technolo-

holders called for a national regulatory body under the UAE Federal Government to monitor and regulate the desalination industry and address all related issues. They also recommended that desalination management should be brought under the scope of Integrated Water Management in order to ensure long-term sustainability.

Divided into five main sessions, the workshop saw 15 papers being presented and discussed by 72 par-

and energy solutions with its strong support of the 1001 Wells Project in Darfur, a huge United Nations initiative by the Boston University Centre for Remote Sensing under the direction of Dr. Farouk El Baz, the Centre’s Director. The project is an ambitious humanitarian initiative to provide access to water to thousands of Darfur refugees living under grave conditions in northwestern Sudan, including acute scarcity of water.

TechnoPark, the Boston University

DUBAI REAL TIMES

The opening ceremony featured the launch of the Excellence Centre for Integrated Water Management, a world-class initiative to undertake applied research in Water Cycles, sustainable solutions for the ecosystem and the proper use of water resources.

Salma Hareb, CEO of Economic Zones World, said: “In collaboration with our partners, this world class R&D centre is dedicated to water issues. Its objectives include research in qualitative and quantitative water management, adequacy of water for human use, and planning for water sustainability.”

Speaking at the ceremony, His Excellency Mohammed bin Dha’en Al Hameli, UAE Minister of Energy, said: “Despite the advances that have been achieved in water desalination internationally and regionally, the world water situation is worsening due to the inadequate availability of clean water, population increases, wastage and bad practices in water usage. All these factors which are relevant at international, regional and local levels, paint a frightening scenario of people competing for insufficient sources of water with all the attendant ramifications of that struggle.

“Today, here in this conference in which we are discussing the looming water problem, and in front of this gathering, most if not all of whom, are the decision makers in this area and from this platform, we should declare that it has become incumbent upon us all to take a serious stand and to keep doing all we can; governments, private organisations, and individuals alike to conserve water, irrespective of its source including desalinated water, through encouraging research and scientific experimentation to develop new designs for desalination plants which are cost effective, technologically advanced and environmentally friendly, so that we can achieve desalination for a better world.”

The UAE Minister of Environment and Water, Dr. Rashid Ahmad bin Fahad, highlighted the strain on the already-scarce water resources caused by nature and development.

He noted that there were more than 30 desalination plants operating in

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Green parking areas Dubai Municipality has taken up a new initiative to introduce green

the Roads and Transport Authority on the possibility of its application in all areas in the emirate of Dubai, as per technical regulations,” he said.

Lootah said that Dubai Municipality would implement the project in cooperation with the concerned authorities as part of spreading green areas, along with the need to take into account environmental standards to achieve sustainable development and strengthen the culture of green environment and organic and visual harmony between the population and the urban fabric of the city.

“This is in line with our vision to create an excellent city that provides the essence of success and comfort of living through the development of laws and regulations to keep pace with international standards in the field of sustainable development, by cultivating parking lots in the emirate of Dubai,” he said.

Lootah said that the project will be implemented gradually and in

community and the preservation of the ecosystem.

Go green with artificial grass Save water, money and environment with simulated turf, says leading UAE company.

Companies and individuals seeking ways of reducing spiralling water bills as well as contributing to the environment are being urged to ‘go green’ by landscaping with artificial grass.

“Amazing as it may seem, the cost of laying out a garden or terrace with today’s natural looking artificial grasses can be recouped in less than two years in water savings alone,” said Markus Oberlin, General Manager of Farnek Avireal, a leading UAE company advising building owners on how to dramatically cut their utility bills.

According to the United Nations,

Green parking area

parking areas in the emirate of Dubai as part of the new criterion in green building specifications. Eng. Hussain Nasser Lootah, Director-General of Dubai Municipality, said the green parking project aims to transform all parking areas in Dubai to cultivated areas.

“We will start the project with the municipality parking areas and the parking lots of projects, plus commercial and residential complexes.

We will also seek the cooperation of

line with the green buildings and green roofs projects. “Dubai is witnessing tremendous growth in urbanisation, and as a result, temperature in the region is rising. Green parking areas is one of the environment friendly solutions adopted by the Dubai Municipality to meet the expected urban expansion,” he said.

Lootah said the green parking area project is also significant in improving the environment and air, thereby improving the health of the

the Gulf Cooperation Council countries are among the world’s highest

per capita water users, and UAE residents top the table by consuming the equivalent of an average of 550 litres a day each, virtually all of which is produced by expensive desalination.

With water a scarce and increasingly expensive commodity in the Arabian Gulf, the UAE Minister of Energy Mohammed bin Dha’en Al Hameli recently called on governments, private organisations and individuals to do all they can to conserve water.

“We have analysed UAE water consumption rates for irrigating natural grass and found that between 130 and 180 litres are needed for every square metre per year – which is around Dh75 a square metre,” Oberlin added. “Using artificial grass not only saves water but money too.

“Modern, low maintenance, natural looking artificial grasses are in widespread use in Europe and North America but are surprisingly rare in the Middle East where maintaining natural grass is much more costly and environmentally unfriendly.

However, all that is changing. With building regulations under review to include a compulsory percentage of green space or landscaping, the costs and limitations of natural grass are becoming increasingly apparent,” he said. “For example, a major private school in Dubai has laid out its large football, rugby and hockey pitches with the latest simulated turf.

“Another great money saving use for artificial grass is in pubic urban landscaped areas such as road verges, traffic islands and interchanges.”

Water and cost savings are not the only reasons for switching to artificial grass, Oberlin added. “Natural grass can harbour insect colonies, especially mosquitoes which are a major health hazard. Artificial grass doesn’t need to be sprayed with the chemical pesticides that can be harmful to children and animals.”

DUBAI REAL TIMES

Centre for remote sensing, and Concorde-Corodex Group have signed a Memorandum of Understanding on the sidelines of the IDA World Congress 2009. Concorde-Corodex Group will donate a fully integrated mobile desalination plant, which normally costs about $250,000, for the first well to be drilled in Darfur.

The unit generates 100,000 litres of fresh water per day and has the potential to provide water for up to 4,000 refugees in the affected region.

The Dubai-based group will also supply the consumable chemicals and filters as well as train local technicians and engineers in the operation of the unit.

TechnoPark will co-ordinate the deployment of the desalination plant and ensure its successful initiation.

45 Simulated turf is now more realistic than ever

PROFILE

BESIX Group celebrates a century of building experience Over three decades of commitment in the UAE and Middle East

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Towers Hotel in Dubai and, most recently, the world’s tallest building, Burj Dubai.

With three decades of growth in this part of the world, Besix Group, headquartered in Belgium, has made the Middle East its second home. Though one of numerous groups offering key industry services within the region, this one attributes itssuccess not only to their in-house design and engineering experts, but the visionary minds within the region, offering the challenge of innovation, a rare quality in the construction world.

“We thrive on developing struc-

DUBAI REAL TIMES

he BESIX Group are celebrating 100 years of experience and innovation in construction of large and complex buildings, marine works, infrastructure and environmental projects around the world. In an event held to mark the milestone, in the presence of chief executives, local dignitaries and the Duke and Duchess of Brabant, their Royal Highnesses, Prince Philippe and Princess Mathilde of the Kingdom of Belgium, the group thanked the region for its trust and partnership and commitment to continuing their level of excellence into the next century.

The group, which has been pioneering its field since 1966 in the UAE, has been a driving force in the development of a number of high profile structures within the country, including the Abu Dhabi Corniche, Bainunah Tower, The Grand Mosque, Emirates Palace, Yas island, Emirates

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Duke and Duchess of Brabant, their Royal Highnesses, Prince Philippe and Princess Mathilde of the Kingdom of Belgium

2009 saw a major partnership penned that will see the company responsible for the design, building and maintenance of the largest ‘MBR' (Membrane Biological Reactor) water sewage plant in the world, with a capacity of 220.000 m³ per day in Dubai tures that are unique and innovative, and the UAE has enabled us to work on some truly pioneering projects.

We have been able to carry out visions and this has inspired us to grow. It is fair to say we would not be where we are today without the opportunities we have found in the UAE and the Middle East. We are committed as a lifelong partner to this part of the world,” commented Mr. Johan Beerlandt BESIX Group Chief Executive Officer.

The company’s CEO has more than a small affection for the UAE with his career starting as a project engineer in Abu Dhabi in 1976. With a recent nomination that saw him in the role of Chairman of the ArabBelgium Luxembourg Chamber of Commerce, the Group’s link to the UAE has strengthened. This tie is a partnership built on decades of trust and excellence.

The group has seen its manpower doubled in the last four years. More-

over, the Group has come to the forefront not only in construction and engineering but marine works and water treatment facilities as well.

2009 also saw a major partnership that will see the company responsible for the design, building and maintenance of the largest ‘MBR’ (Membrane Biological Reactor) water sewage plant in the world, with a capacity of 220.000 m³ per day in Dubai. With a 30-year partnership signed with Nakheel and a 25- year contract with ADWEA to service both Abu Dhabi and Al Ain, the accomplishments of the Group in each of their key sectors is a testament to the solid foundation built within the UAE and region over the last three decades.

“We believe the UAE and the region as a whole have only begun to demonstrate their potential vision and we are proud and excited to be a part of it today and well in to the future,” added Beerlandt.

LEGALLY SPEAKING

Your questions answered by Helen Tapadar Hangari and Jacqueline Latham, DLA Piper Middle East LLP I invested in an off-plan property earlier this year and when I entered into the contract with the developer, I provided four post-dated cheques to cover the initial instalments. As far as I am aware, the development has not progressed and I want to cancel the remaining cheques. I have heard that this could result in imprisonment. Is this true?

DUBAI REAL TIMES

This is a possibility, as dishonouring cheques is a criminal offence under the Commercial Code and the Penal Code; and should the developer take the dishonoured cheques to the police you could face up to three years imprisonment, in addition to a fine ranging between Dh100 and Dh30,000. As you may also be in breach of your contractual obligations by failing to make the instalment, you should also be aware that you could be exposed to civil penalties.

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I have been in Dubai for a year and shall shortly be negotiating my lease renewal with my landlord. I have heard many accounts that the rent can only be raised by five per cent. Is this the case?

This used to be the case. However, the law changed earlier this year, and rent reviews are now pegged to a rent index prescribed in an annually revised decree. The rent index percentages are based on property location and the current market rate when compared to the rent payable under the lease: if the rent payable under the lease is below a banded percentage threshold, an appropriate increase can be made to bring the revised rent in line with the current market rate.

Therefore, the percentage increase could exceed five per cent.

It should be noted that the current landlord and tenant legislation provides that a rental increase cannot take place within the first two years of a lease, so if you have only been renting the property for a year, there can be no increase in rent.

I am a developer of residential apartments, most of which were sold off-plan. As we are nearing completion of the project, we have noticed that some of the apartments are actually smaller than the size we contracted to provide to the purchasers. Do we have to compensate the affected purchasers?

My tenancy agreement is due to end in January and my landlord contacted me last month to say that I cannot renew my tenancy because he wants to sell the property. Doesn’t he have to provide me with a bit more notice?

Yes. Under Law No. 13 of 2008 regulating the interim real estate register, where there is a significant decrease in the size of a unit, a purchaser can claim compensation from a developer. The Law does not however specify what would be considered ‘significant’, nor does it state what level of compensation should be made available to the affected purchaser.

Where a landlord wants to end a tenancy on expiry of the tenancy contract on the grounds that he wishes to sell the property, then in accordance with Law No. 33 of 2008 which amends the earlier landlord and tenant law, the landlord must provide you with 12 months notice stating the reasons for the eviction, and this notice should be served via notary public or by registered mail.

2010 Calendar