Sharjah developer Arada considers further Armani projects after last year’s sales boost
▶ Company plans first trackless tram in its home emirate as revenue doubles to Dh7 billion in 2023
Sharjah developer Arada plans to continue its aggressive expansion in Dubai with new projects, amid record sales figures in 2023.
The developer doubled its sales last year to Dh7 billion ($1.9 billion), compared with Dh3.5 billion the year before.
Following the sales launch of Armani Beach Residences on The Palm Jumeirah this month, Arada plans to acquire more plots in Dubai to launch new luxury projects, Ahmed Alkhoshaibi, Arada group chief executive, told The National.
He said Arada’s sales in Dubai will overtake what it sells in Sharjah – where it is developing a 2.2-square-kilometre megaproject, Aljada.
This includes an entertainment complex designed by the acclaimed Zaha Hadid Architects, four hotels, three schools and a business district. It will eventually be home to 75,000 people.
The project, which is expected to be completed in 2030, will see the introduction of the emirate’s first tram system.
“Our target for 2024 is Dh10 billion in sales and we expect Dh6 billion from Dubai and Dh4 billion from Sharjah,” Mr Alkhoshaibi said.
Its first Dubai project, Jouri Hills, a 294 luxury villa project at Jumeirah Golf Estates, sold out last year.
And, despite only launching a little more than a week ago, Armani Beach Residences has already sold more than 20 per cent of the 53 ultra luxury apartments at Dh8,000 per square foot.
Arada will launch two further luxury, branded projects this year – at Dubai Harbour and DIFC. But neither will be Armani, the Italian fashion house with which it has signed a sixyear exclusivity contract for the UAE, Mr Alkhoshaibi said. “We’re launching maybe next month or March, the Harbour project – it’s not Armani.”
In DIFC, close to Index Tower and Central Park Towers, the 50-floor luxury residential tower will have 400 apartments, some of which will have Burj Khalifa views. “It’s a luxury – it could be branded or could be a new brand, we’re looking at both options,” Mr Alkhoshaibi said.
“Both [DIFC and Harbour] will focus on the experience of the resident, with plenty of amenities to differentiate it from others.”
Arada is considering another project with Armani.
“There could be [a new project], depending on the location, because it is an expensive product to build – very expensive – so, it needs to attract that selling price. There could be an Armani villa community coming up, potentially in the future, but nothing [confirmed] yet. We’re looking for the right location.”
Mr Alkhoshaibi said Arada is “negotiating a couple more plots in Dubai” that he hopes to be in a position to announce later this year. “We’re trying to get bigger projects to give us a bit more planning than two years,” he said.
“So far, our inventory is probably two years selling. Whatever we bought is two years maximum [before being sold out].”
Launching new projects in Dubai is attractive for developers like Arada, with property prices soaring to new highs each month.
Mr Alkhoshaibi said prices will continue to grow between 5 per cent and 9 per cent this year, and taper down to 3 per cent in 2025.
“Coming from a high growth period, that’s still a great thing because demand is there.”
Arada, a joint venture between KBW Investments – a company controlled by Prince Khaled bin Alwaleed – and Sharjah’s Basma Group launched in 2017 with Aljada, which has a current sales value of Dh35 billion – a 45 per cent increase from its value at launch.
“Aljada is a long-term project that keeps appreciating as we deliver. People are understanding that this is not like any other project that’s available in the UAE,” Mr Alkhoshaibi said.
“It is the ethos of live, work, play to another level. We say that in Aljada, you literally don’t even need to own a car.”
Getting around will be simpler too, with plans to launch a new trackless tram system, similar to those being trialled in Abu Dhabi.
“We’re looking at a continuous loop within the project. We call it a sustainable lane, which has been built already. We’re talking to a manufacturer,” he said. “It’s going to be free. It’s like a hop-on hop-off, with multiple stops, and our objective is that you don’t wait more than five minutes for a pickup.”
Located in what Mr Alkhoshaibi describes as the “new Sharjah”, he said traffic is less of an issue for residents.
“Connectivity to Dubai in the new Sharjah is a lot easier, you have Mohammed bin Zayed Road, Al Dhaid Road, which connects to the Emirates Road, and the University Road, which also connects to the Emirates Road,” he said.
“It’s easy to get to Dubai from here. That’s why there’s a big migration of people within Sharjah coming here, and people from Dubai and from the Northern Emirates.”
The Sharjah law change in 2022 to allow full freehold ownership of properties, coupled with progress on the site, has seen a sharp increase in own-occupiers. About 65 to 70 per cent are end users, with the remainder investors.
Arada announced last week the start of the handover of the first 430 homes in its forested megaproject, Masaar.
Located in the Suyoh district of the emirate, close to Tilal City and the Sharjah Mosque, the project consists of 3,000 villas and townhouses over a 19 million-square-foot master plan that includes a 6.6km looped cycling circuit.
Mr Alkhoshaibi said Arada will continue to expand in its home emirate. “In Sharjah, we’re about 70 per cent market share of off plan sales and we want to maintain that,” he said.
“We’re very aggressive and bullish on the Sharjah market and we’re looking at other lands in Sharjah.”
Financing new plots will most likely require another sukuk for Arada.
In February, Arada closed a $50 million second tap of its existing $450 million sukuk that was issued and listed on the London Stock Exchange in June 2022.
Mr Alkhoshaibi said the company’s sales revenue has given it the cash liquidity needed to build its current projects.
“We’re selling way ahead of our construction, so by the time we start construction, we’re 100 per cent sold,” he said. “But we will probably, if we do acquire [land], probably in the short and medium term, we will do another sukuk.”
He said an initial public offering is “still on the table”, but is three to five years away from happening.
“We’re not in a hurry. The value proposition of Arada will be really appreciated in about three years, I would say,” Mr Alkhoshaibi said.
Our target for 2024 is Dh10 billion in sales and we expect Dh6 billion from Dubai and Dh4 billion from Sharjah AHMED ALKHOSHAIBI
Arada group chief executive