Nakheel posts Dh2.64B net profit for first half
dubai — Nakheel, one of the leading property developers in the UAE, reported on Wednesday a net profit of Dh2.64 billion for the first six months of 2017. The profit for the same period in 2016 was Dh2.95 billion.
The developer of Palm Jumeirah and other landmark projects said in a statement that it is confident of achieving its forecast 2017 result, which will reflect an overall growth in profits for the year.
Nakheel said it handed over almost 870 land form and built form units to customers between 1 January and 30 June 2017. In line with the company strategy, revenue from non-development businesses — including retail, leasing, hospitality and asset management services — registered a significant increase. Annual revenues from these segments have more than trebled from Dh800 million in 2010 to Dh2.5 billion in 2017. The surge in non-development revenues has also resulted in a significant increase in the asset values of the company.
“Nakheel is continuing its strategy of developing its cash-generating assets, and announced construction contracts worth more than Dh11 billion in the first six months of 2017. These include an Dh4.2 billion contract for Deira Mall at Deira Islands and a contract for Dh1.5 billion for The Palm Gateway at Palm Jumeirah,” said the master developer.
Nakheel has released a construction tender for its first hospitality joint venture — the Dh670 million, 800-room RUI resort at Deira Islands. The company has also broken ground on new hotels at Dragon City and Ibn Battuta Mall, which have a combined project value of Dh416 million.
Sanjay Manchanda, the CEO of Nakheel, told Khaleej Times in a recent interview that the developer had tweaked its business strategy and added more verticals such as retail, hospitality and residential leasing to its portfolio. “This was to hedge against fluctuations in property development and to add more income-generating businesses.”
On Nakheel’s future, Manchanda, said: “I don’t think anybody can predict where we would be 10 or even three years from now; the world is changing so fast. We have to be very circumspect about the changing environment around us and respond very quickly or we risk being left behind.”
He said Nakheel is the second largest residential leasing company in Dubai behind Al Wasl and has around 17,000 residential units under lease.
The developer currently operates 4.5 million sq ft leasable area in retail and aims to quadruple that figure in the next three to five years. Nakheel is already active in the hospitality market with an Ibis Styles near Dragon Mart and Premier Inn on Sheikh Zayed Road. Besides tapping the mid-market hotel space, Nakheel also has tie-ups with new brands which will bring in four-star properties to Dubai.
— issacjohn@khaleejtimes.com