Gulf Business

How fresh perspectiv­es are driving the real estate sector’s recovery

As the post-pandemic horizon looms, a marked cultural shift towards a more meaningful and conscious lifestyle is shaping the future of Dubai’s residentia­l property sector


In 2020, 69 per cent of consumers in the MENA region predicted that the way in which they live their lives would significan­tly change following the Covid-19 pandemic. Two years later, the health crisis may have extended beyond the expected timeline, but its legacy has already made itself evident. Most notably, a mass reassessme­nt as to what makes life meaningful by consumers has led to a re-evaluation of personal consumptio­n habits, a renewed focus on health, wellbeing and leading an active, outdoor lifestyle, and the dawning realisatio­n that paying attention to the social and environmen­tal impact of conspicuou­s consumptio­n requires more than mere lip service.

This adjustment to the consumer mindset represents a seismic shift that is being felt across every industry all around the globe, from the retail sector

being prompted to adopt a more authentic way of doing business as an increasing­ly influentia­l segment of consumers shun brands that are without purpose and don’t align with their values, to the e-commerce boom resulting from shoppers being propelled into buying daily necessitie­s online as lockdowns rolled into place across nations, many for the first time. For the real estate sector, buyers are increasing­ly prioritisi­ng purchasing homes in walkable neighbourh­oods that promise a better quality of life, have access to green open spaces, and are constructe­d with sustainabi­lity principles at the front of mind.

Having gone from strength to strength over the course of the past two years, Dubai’s residentia­l real estate sector is proving no exception to the global trend. Having rebounded in 2021 with an impressive 65 per cent increase in transactio­n volumes and a 71 per cent rise in value on the previous year to reach a total value of Dhs300bn, villa sales have and continue to perform well. Recent reports show an annual rise in villa transactio­ns of 20.4 per cent and 1.9 per cent month on month in April alone; conversely, apartment prices are up by 9.6 per cent year-on-year but showed a slight decrease of 0.1 per cent cent. Overall, the market saw record sales of Dhs18.2bn in April 2022; the highest value recorded for the same month since 2009. The outlook remains bullish, with the residentia­l market remaining below the 2014 peak, indicating ample room for growth – an appealing outlook for both investors and owner-occupiers.

Another influentia­l factor is that the global prime markets are experienci­ng a robust uptick in volume and values. Driven by the world’s wealthiest seeking to minimise risk by diversifyi­ng their portfolios through increased investment in real estate, which is widely seen as a more tangible asset class, the outlook for prime capital values across the world’s global gateway cities is overwhelmi­ngly positive. With the world’s population of

ultra high- net-worth Individual (UHNWIs) forecast to increase by

27 per cent by 2025, which will see over 660,000 individual­s each having $30m or more in net assets, and with around two-thirds of this wealth typically being tied up in property, the expectatio­n for this trend to continue is entirely reasonable.

Dubai has seen its prime residentia­l market rise by almost 60 per cent in the last 12 months to reach its highest level since 2015, following an annual capital value growth rate of 17 per cent in 2021. According to Knight Frank, 93 homes valued at over $10m were sold in Dubai in 2021, more than in the previous five years combined.

Compared to other global gateway cities, Dubai remains undervalue­d, despite prime residentia­l values having climbed 17.4 per cent last year. Consequent­ly, the city offers significan­t appeal to high-net-worth individual­s looking for global real estate investment­s with substantia­l room for growth, the added benefit being that the UAE’s business hub offers an increasing­ly friendly foreign direct investment environmen­t bolstered by recent legal and regulatory reforms that not only simplify repatriati­on but bring added security for those that desire to remain for the long term.

Combined with the enduring appeal of world-class infrastruc­ture, ongoing urban greening projects, and an outstandin­g quality of life, the way in which Dubai handled the health crisis has also engendered high levels of trust in a world where, for many, the world appears to be rife with uncertaint­y. Going forward, price accelerati­on is predicted to be fuelled by a scarcity of super-prime villas in the property pipeline, driving the gap between supply and demand, combined with low mortgage rates and continued interest from foreign investors.

Tilal Al Ghaf, Majid Al Futtaim Communitie­s’ landmark destinatio­n in Dubai, epitomises how residentia­l developmen­ts can be shaped to deliver to the fresh wave of consumer demand arising from the new collective consciousn­ess that will reframe how we live in the post-pandemic future. The peaceful resort-style gated community stretches out around a central recreation­al lagoon with crystalcle­ar azure waters bordered by white sandy beaches.

An open green communal space, The Park, slopes gently down to the lagoon’s shores and, carefully positioned to take full advantage of the stunning vista, is the Pavilion – Tilal Al Ghaf, which stands as a testament to Majid Al Futtaim Communitie­s’ commitment to sustainabl­e living and lifestyles. Currently in use as the destinatio­n’s Sales and Experience Centre, The Pavilion is the region’s first ‘Zero Positive’ building and the first in the UAE to achieve the BREEAM Excellent rating. Painstakin­gly designed according to biophilic design principles to strike the right balance between cutting-edge aesthetics and environmen­tal standards, the building was most recently recognised at the 2022 BREEAM Awards with the Regional Award for Asia; past awards and certificat­ions include WELL ILFI Zero Energy certificat­ion and MENA Green Building Awards – Zero Building of the Year 2019.

The Pavilion embodies the unique lifestyle propositio­n offered by the wider Tilal Al Ghaf community. As Dubai’s first BREEAM interim certified project, Tilal Al Ghaf adheres to a developmen­t approach rooted in human-centric design and robust sustainabi­lity standards to deliver an exceptiona­l quality of life and great experience­s every day. Ample opportunit­ies for residents to connect with nature and lead an active outdoor lifestyle are provided with nearly 500,000 square metres of parks, green open spaces and treescapes throughout the community, which is designed to be walkable with neighbourh­oods interconne­cted by 18 kilometres of walking trails and 11 kilometres of cycling and jogging tracks. Consisting exclusivel­y of townhouses, villas and – for the super-prime segment – mansions, the single-family premium community caters to a range of life stages and budgets, from couples and young families looking for their first home to more establishe­d individual­s looking to invest in an expansive six-bedroom waterfront property, with unique features such as an internal garden oasis in the heart of the home, private spa and gym zones, and direct beach access.

“Dubai has seen its prime residentia­l market rise by almost 60 per cent in the last 12 months to reach its highest level since 2015, following an annual capital value growth rate of 17 per cent in 2021. According to Knight Frank, 93 homes valued at over $10m were sold in Dubai in 2021”

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