Nakheel confirms relaunch of Palm Jebel Ali

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• The Dubai master development has been on hold since 2009
• Relaunch comes at a time of real estate boom
• Residential market expected to see 80,000 more homes by 2026

Dubai state-owned developer Nakheel has confirmed it is planning to relaunch the Palm Jebel Ali master project, as it looked to take advantage of record demand for real estate in the emirate.

Palm Jebel Ali is one of a series of manmade, palm-shaped island projects off the coast of Dubai.

Launched in 2002, it stalled during the global financial crisis and development at the site has been on hold since around 2009.

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“We confirm that the Palm Jebel Ali masterplan is being revisited. Further details will be released in due course,” a Nakheel spokesperson told AGBI.

The news comes as several reports claimed Nakheel was planning to raise a loan of around AED17 billion ($4.6bn) to refinance existing debt and fund its development plans.

The Financial Times reported this week that Nakheel had appointed local banks Emirates NBD, Mashreq and Dubai Islamic Bank to help with the fundraising, and AED6 billion would be allocated to the relaunch of Palm Jebel Ali.

The relaunch of Palm Jebel Ali comes at a time when Dubai’s real estate sector has enjoyed a record surge in sales.

Online platform Property Finder reported that the Dubai property market in August recorded 9,720 total sales worth AED 24.3bn ($6.62bn), the highest performing month in terms of sales transactions volume and value in 12 years.

The figures showed volume growth of around 69.6 percent year-on-year, while the value of sales grew 63.6 percent year-on-year.

Palm Jebel Ali is one and half times the size of the popular Palm Jumeirah, which itself has enjoyed strong demand from wealthy buyers.

“Dubai’s residential market is expected to see some 80,000 homes delivered before the end of 2025, half of which should be completed by the time we get to December this year,” Faisal Durrani, partner and head of Middle East research at real estate consultancy firm Knight Frank, told AGBI.

“Interestingly, when we zoom in on the planned stock, it becomes clear that there is a severe shortage of high-end luxury homes, as well as villas.

“In fact, just 20 percent of the planned supply is expected to be villas. And between 2023 and 2025, the city’s prime neighbourhoods (the Palm Jumeirah, Jumeirah Bay Island and Emirates Hills) are expected to see just eight new homes completed.”

Durrani said some locations on Palm Jumeirah have seen villa values expand by 68 percent since the start of the pandemic in 2008.

In August Nakheel also unveiled the masterplan for its 17-square-kilometre Dubai Islands development, which was the revamped masterplan for the Palm Deira project.

Dubai Islands will be spread over five islands and will house more than 80 resorts and hotels, 20 kilometres of beaches, plus parks, open spaces and golf courses.

Real estate firm Savills said Dubai prime prices grew by 4.7 percent during the first half of the year and the city is forecast to witness strong capital growth for the remainder of 2022, placing the emirate at number four in a new list of the world’s best-performing markets.