A group of private investors will launch the UAE’s first locality-specific fund to invest $6 billion (Dh22bn) in the Dubai World Central (DWC) in Jebel Ali, Emirates Business has learned.
“We are studying the modalities and trying to define the business model for investment in DWC. We are already in talks with Daman Securities on this,” a person close to the initiative said. Buildan Development and Daman Investment will launch the fund, the person said. “Although discussions are at a very preliminary stage, the fund will be open-ended and could go up to $6bn.”
Buildan is an investment firm that will be looking at developments and other business opportunities in DWC, an artist's impression of which is pictured above.
DWC yesterday said the second phase of DWC Residential City sold out for Dh6bn. Regional developers, corporate houses and individuals bought 255 plots spread over 183 hectares, the company said in a statement. About 160 hectares was sold in the first phase for Dh2.5bn.
“While phase one saw corporate houses leading the investor rush, this time around most major real estate developers have invested,” said Khalid bin Harib, CEO, Real Estate, DWC. “This marks the maturing of DWC real estate within Dubai’s realty offerings.
“Regional developers have understood DWC’s value proposition in offering mid-cost housing, which is in high demand and will reach its peak around 2010. By then current investors of phases one and two would have already realised [gains on] their investment.”
About 20 per cent of phase two has been reserved for DWC’s future use in development and construction. DWC is a 140-square-kilometre urban aviation community centred around what is planned as the world’s largest international airport – Maktoum International. Being built 40 kilometres from the existing Dubai International Airport, the project is almost twice the size of Hong Kong island.
The Dubai Government announced last week that it will soon launch a new low-cost airline this year, which will use the upcoming Maktoum International Airport at DWC as its hub.
Land prices in the Gulf have soared due to surging demand for housing and office space spurred by rapid economic growth resulting from windfall oil revenues since 2002, according to analysts as the Jones Lang LaSalle consultancy.
Dubai-based Emaar Properties, the largest Arab property developer by market value, last week said the fair value of its land bank in the region increased by a massive 74 per cent in 2007 compared to the previous year.
$6bn fund to target DWC