Dubai luxury real estate has stabilised, says Deyaar CEO

March 7, 2024, 10:51 AM

Interview with Saeed Al Qatami
Demand rising for mid-range property
Company to launch in Abu Dhabi

Demand for mid-segment and affordable properties will increase in the coming months as luxury real estate prices start to stabilise, according to Saeed Al Qatami, CEO of the Dubai master developer Deyaar Development.

“This is a segment that will see more demand and an increase in prices. Luxury has stabilised,” Al Qatami said.

Last month Deyaar launched a AED750 million ($204 million) residential project, Eleve, in Downtown Jebel Ali in Dubai, scheduled to be completed in 2027.

The company will also be announcing the launch of another affordable low-rise residential project in the second half of this year.

Newsletter
Get the Best of AGBI delivered straight to your inbox every week

Later this year Deyaar will launch its first project in Abu Dhabi on Reem Island, joining developers such as Aldar that are expanding beyond their core markets.

Deyaar’s net profit more than trebled to AED440 million in 2023, thanks to the launch of new projects and a hot real estate market. The company, which is listed on Dubai Financial Market, announced the approval of a dividend for the first time this week.

“We have to ensure that we launch two to three billion dirham worth of projects every year. That’s why we’re considering launching three to four projects every year,” Al Qatami said.

While a crisis could be looming for commercial real estate in the West, the sector is doing particularly well in the UAE.

The market-wide average occupancy rate in institutional-grade buildings tracked by the real estate consultancy company CBRE reached 91 percent in Q3 2023 and Prime, Grade A, and Grade B rents grew by 0.5 percent, 3.4 percent, and 4.8 percent respectively in Q4 2023.

“In Dubai, an office space on Sheikh Zayed Road would have been leased for AED100 per square foot a few years back. Today, you can’t get it for AED300 [per square foot],” Al Qatami said.

“We’ve seen phenomenal growth into the commercial space and this is something that developers need to tap into. Maybe, we could have a project within the next 12 months. We need to find the right location.”