(DENNIS B MALLARI)
Omniyat Properties intends to invest more than Dh1.5 billion on the development of residential and commercial properties at the Waterfront, The Lagoons and Business Bay, a senior executive said.
The company, a member of Omniyat Holdings, has purchased 1.5 million square feet of land at the Waterfront and a similar area in Business Bay. It has also bought a million square feet of land in The Lagoons.
President and Chief Executive Mehdi Amjad said Omniyat will build a tower and a hotel at the Waterfront and The Lagoons and an office tower in Business Bay.
Omniyat has entered into an equal partnership with Investate of Bahrain to finance the Waterfront project. It will finance the two other projects on its own, Amjad said. Work will begin soon on all these projects, he said.
Since its establishment two years ago, Omniyat Properties has launched five commercial properties and two residential ones worth a total of Dh4.9bn. The latest investment of Dh1.5bn is part of the company’s drive to boost its property investment portfolio to Dh10bn and become one of the fastest growing property development companies in the region, said Amjad.
Amjad expected demand for residential and commercial property units in Dubai to exceed supply until the beginning of the next decade.
He said doubts that demand levels will go down in 2008 and 2009 are not based on tangible facts. Dubai’s economic growth and the attraction of the property sector for new investors will guarantee a continuation of the state of imbalance between supply and demand in the property market over the coming years, he added.
Amjad drew a link between the growth of demand for property units with forecasts that speak about the redoubling of Dubai’s population over the coming eight years. He rejected talk that the Dubai property market is just a bubble in the air.
The chief executive said whatever property units are made available will not be enough for coming years. The proof is despite the delivery of thousands of units in the International City and Jumeirah Beach Residence projects, the volume of demand is still high, he said.
With the growth of construction potential through attracting new players from various parts of the world, there will be an ability to develop new projects and deliver them on time, he said.
“Currently there are delays in the delivery of a number of projects because developers have not been able to control the contracting companies with whom they have signed contracts and to force them to work within the specific time schedule.
“But you do not find this situation in Omniyat Properties projects, because it carefully selects partners and subjects them to high-quality criteria,” Amjad added.
On why most of the development projects target high-income people, Amjad said it is natural in the new property markets where there are people with liquidity and ability to venture.
He said in the first five years of the property boom witnessed by Dubai, there was a very rich section of people and products were presented by developers to meet this section’s needs.
But now, he said, the market is more mature, and developers have started to build projects for the middle-class and limited-income people who only entered the freehold market after the rise in rents and living costs. They have come to realise that owning property is better than renting it, he added.
Omniyat will be among those property companies that develop such projects in the near future at a time when the Dubai Government seeks to offer easy property and finance loans to enable low- and limited-income people to buy property units, whether commercial or residential, he said.