RAK promotes realty growth
The first phase of Saraya Islands, a Dh1.83-billion mixed-use resort destination in Ras Al Khaimah, will be ready for occupation by 2011, according to general manager Mahdhar Abdullah Al Tamimi (pictured above). The project comprises four islands – Al Boum, Al Marsa, Al Sahab and Al Wahat – which are inter-connected through a series of appropriately scaled resort-style roads and bridges.
Al Tamimi believes a phase-wise release of the product will help them control cost escalation and RAK is witnessing progressive growth that fosters real estate development. He spoke to Emirates Business about the project, its prospects and his plans.
Saraya Islands was launched in 2005. How is the project progressing now?
We have completed our studies and evaluations and have advanced into the master plan to reach the detailed design stage. The site investigations have already started and the preparations for the next phase of development are under way.
How much are you investing in infrastructure development and what are the challenges when it comes to reclamation?
With regards to the infrastructure we have taken all measures needed to develop a first-class luxurious resort development. We have ensured the entire infrastructure is up-to-date and is able to meet the project’s requirements, such as designing bridges to complete the circulation within the project to an optimal form.
There is no reclamation planned for this project as the development is on a natural island. There will be some enhancements done for developing the project.
Does the holding pattern of the company still remain the same – Ras Al Khaimah Government, Saraya Holdings and Arab Bank – or is there any change?
It remains the same.
How is work on Al Boum, Al Marsa, Al Sahab and Al Wahat islands going? In what phases will it be completed?
The development strategy has been finalised and the islands will be phased accordingly.
When do you expect to complete the entire project? How many apartments, villas, hotels, resorts will be there?
The project will be delivered in phases with the first phase being ready for occupation by 2011. The total number of residential units is about 4,700 and about 1,600 hotels.
Do you plan to export this concept to other emirates and overseas? If so, when and where?
Saraya Islands is one of Saraya’s projects in Ras Al Khaimah. Saraya, the mother company, has a vision to take untapped locations and turn them into luxurious tourist destinations.
We have projects currently at various stages of development, including Saraya Bandar Jissah near Muscat, Oman, Saraya Aqaba at Aqaba in Jordan, Saraya Dead Sea at the Dead Sea in Jordan, Saraya Aktau on the Caspian Sea in Kazakhstan, and Saraya Sochi on the Black Sea in Russia.
Do you believe there is an urgent need for UAE to harmonise its property law so all emirates have everything in common?
The UAE is going through mass changes in the real estate sector, which is lead by Dubai and Abu Dhabi. Eventually each of the emirates will refine its own laws that will be aligned with the UAE federal law.
Getting experienced and talented people in the real estate sector is becoming an arduous task. Are you facing any such problems?
The real estate sector has been evolving for some time in the UAE. The successful concepts of our projects have attracted the talent mix that we have on board. However, the challenges of getting experienced staff are common within the sector.
How much debt are you planning to raise to fund your projects?
We are studying the amount to be raised, as well as various debt alternatives.
Do you believe it is the right time to borrow from the market since the US Federal Reserve has cut rates? Does it make borrowing cheaper for you?
The borrowing factor would be considered in the context of potential returns for a similar investment. Taking into consideration the positive trend of the real estate sector, borrowing is a safe form of contribution. Of course, cutting the rates of US Federal Reserve enhances our position.
How much do you expect prices of raw materials to go up by in 2008? How are you planning to offset the cost escalation?
Based on the market studies and trends, there has been different escalations in prices of the various items which have ranged between five and 20 per cent on an average. To offset the cost escalation, we would have to reduce the influence of such escalations, and one of the ways is to phase the release of our products.
What is your view on the UAE and GCC property market? Do you expect it to cool down in coming years?
This is a very speculative question. We have to deal with the market as per our current situation. At this point, we see a positive trend and Ras Al Khaimah specifically is witnessing progressive growth that fosters a real estate development.
Dubai is coming out with new laws and regulations such as escrow account and strata law to regulate real estate development. Are there any such laws in RAK?
The introduction of the escrow account has helped in regulating an expanding market such as Dubai and giving more confidence to investors. With such advancements, it was only inevitable to introduce new laws, such as the strata law to safeguard investors’ rights. As for the credibility of RAK projects, it is largely based on the contribution and the partnering of the government in such projects, as well as on the reputation of experienced developers such as Saraya.
Investment banks and property consultants point to rising delays in completion of various projects. Are you progressing to complete the project on time?
To deliver a project of this magnitude, one has to be realistic in the timelines. With our phased approach, we will strive to deliver the project on schedule.
Mahdhar Abdullah Al Tamimi
General Manager, Saraya Islands
Al Tamimi took over as general manager of Saraya Islands, Ras Al Khaimah, in 2007, bringing with him more than 15 years of international experience.
His job involves strategic planning, financial analysis, sales and marketing, customer relationship building, and operational planning and supervision.
Al Tamimi’s experience, with a substantial part of it in managing and developing tourism projects, has qualified him to be at the top of the Saraya management team.
He was general manager of Jumeirah Islands, one of Nakheel’s projects, where he was responsible for managing a team of high-calibre executives in planning, developing, delivering and managing the project.
He is a graduate of the University of Harrington, UK, where he specialised in business administration.
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