OFFICIAL MAGAZINE OF REAL ESTATE REGULATORY AGENCY
MANAGING EDITOR K Raveendran
MANAGING DIRECTOR Sankaranarayanan
GENERAL MANAGER Radhika Natu
Message from the CEO
Vanit Sethi Manju Ramanan
Sales and Marketing Product Manager
Accounts & Administration
Biju Varghese Circulation Supervisors
Better supply management I view the merger of Emaar Properties with the Dubai Holding entities of Dubai Properties, Sama Dubai and Tatweer as the best thing that could have happened to the Dubai real estate sector. The merger will surely lead to significant synergies among the activities of the companies concerned, with the post-merger outfit enjoying the strengths and clout of a much bigger entity. But from my point of view, the most critical advantage that it provides to the sector is the ability to influence and manage supplies to the market. The consolidation will provide for better supply planning so that the city does not witness any unregulated growth in the real estate sector, which has been the case in the past. Emaar and Dubai Properties are estimated to be in a position to release a total number of over 5,800 new units to the market during 2009 out of a total supply of over 9600 units, with Nakheel accounting for over 3,800 properties, which means Emaar and Dubai Properties account for 60 per cent of the market supply.
Ibrahim A. Hameed Saleem K U
In 2010, supplies from the combined entity are estimated to come down to a little over 55 per cent of the total, although the total supplies to the market are set to more than double. Out of the 19,610 new units expected to be released to the market in 2010, the share of Emaar and Dubai Properties is projected to be 10,810 units, with another 8,800 properties coming from Nakheel.
The consolidation of the sector will provide developers the opportunity to better manage supplies so that the new additions to the market do not lead to any oversupply, which could exert downward pressure on prices and the overall sentiment in the Dubai real estate sector.
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We in RERA have all along been stressing that there was need for a consolidation among the cityâ€™s developers so as to allow for better planning and control of all aspects of the market. The merger of Emaar and Dubai Holding companies is a major move in this direction.
Eng. Marwan Bin Ghalita CEO, Real Estate Regulatory Agency
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C O N T E N T S
3 4 9
Branch Office News Statistics
RERA office at Emaar Business Park Evaluations June figures 6 Taqyeem Rules for Valuers 10
Believing in the Dubai brand
Royal Institution of Chartered Surveyors
Restoring confidence in the market Financing options
Auction results Middle income housing segment Investing for the long term You snooze you lose Local tales
7 Personality Mohammed Rashid bin Serdah
Human resources are your winners
Facilities & Services
Facilities management in demand
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A set of keys
Water and wastewater treatment
A defiant mood
The meaning of CSR
Whoâ€™s Who of real estate lawyers
List of Developers
Law & Regulations
Questions & Answers
Branching out By Linda Benbow of real estate developments 2. Restructuring and revamping real estate registry 3. Launching electronic system for developers and projects’ registry 4. Restructuring and revamping accounts trustees’ registry 5. Adopting new mechanism for real estate developers’ registration 6. Issuing accredited and authentic financial data and reports on developers and their projects 7. Fees-setting and collecting charges from real estate developers Abdullah Mohd Mohd Saleh, Senior Officer – Customer Care, explained some of the activities that take place at the branch office in the Emaar building. “We are here for the customer; to serve people,” he explained with a smile. “We check that all their papers are in order, that nothing is missing. We explain exactly what is needed to register their properties, and how to go about it. When everything is complete, we do all the necessary registering and issue an ownership document.” There are no big queues at this cool and quiet office, which is appreciated by most customers. There have been other branch offices in the past, one at Tecom, which is now defunct as the bulk of all registrations have been completed. Another previous branch was opened, and is now closed, at Dubai Holdings building. Once a property has been built and handed over to the buyer, he makes sure that it is acceptable and signs for it and then goes to Emaar who issues a No Objection Certificate (NOC). This NOC ensures that both developer and customer are fully knowledgeable about all relevant matters such as management
Sheikh Juma bin Thani Al Maktoum
charges, security, charges for the lifts and other facilities. “All the papers are then given to us. We check that all monies have been paid and finalised. We check that the documents state the correct address of the property and project name, its size and how, much has been paid for it, the buyers name and his nationality and passport number and municipality number. We then give the buyer a reference number that he can quote in future correspondence.” In the case of a mortgaged Emaar property, both buyer and bank representative should go to the branch
office and sign all papers together. All the details of sales transactions are entered onto the computer that is linked directly to the Land Department, and then a final Title Deed is given to Emaar, who will give it to their customer. “We are here to register transactions and update our database.” There is also a vice versa deal with Emaar Properties having a representative on the ground floor of the Land Department building, near the creek, for those who want to reregister their properties, mainly as second sale, or re-sale of their villa or apartment.
“We are here for the customer; to serve people,” Abdullah Mohd Mohd Saleh
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ith the amount of sales that Emaar Properties have managed to gain over the past number of years it made sense for them to try and tackle the matter of registrations of documents at the Land Department in a way that was simple and convenient for the customer, the government body and the developer. That is why a branch of the Land Department was successfully set up in 2007 within the Emaar Business Park on Sheikh Zayed Road, on the ground floor of Building One (the building nearest the new villas near Emirates Golf Club). The private, transparent offices are manned by trained Land Department staff from the Strategic & Excellence Department – Customer Care. Recently, the staff here were joined by RERA’s Sheikh Juma bin Thani Al Maktoum, Head of Trust Account, who is now also heading this facility. The Department of Real Estate Development Guarantee Accounts is one of RERA’s most critical departments, with the power to enforce Law No (8/2007) covering guarantee accounts of real estate developments. It is the responsibility of the department to: • Issue an executive bylaw consistent with law • Create and update developers’ registry • Create and update trustees’ registry • Approve real estate projects • Administer trust accounts • Control accounts financially and technically Among the departments achievements are: 1. Issuing the executive regulation which amends Law No (8/2007) that covers guarantee accounts
ERA has made an important accomplishment in unifying the real estate evaluation reports, licensing and qualifying real estate valuers and evaluation companies in Dubai. The Agency has been setting qualifications for companies and individuals to enable them to obtain a real estate valuer license. All real estate evaluation com-
Mahmoud Hesham Al Burai
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Yousif Al Hashmi
panies were invited to a meeting where Marwan bin Ghalita, CEO of RERA and Mahmoud Hesham Al Burai, Director of the Real Estate Sector Development Department, discussed with them the challenges that real estate evaluation in Dubai is facing and the current situation of this market. Marwan bin Ghalita assured them that the agency is providing the sector with all the information necessary to increase transparency and
be effective in the regulation system. Mahmoud Al Burai explained that all the evaluation reports in Dubai Land Department are coming from evaluation of lands, buildings, apartments, villas, commercial and residential complexes, industrial facilities and hotels. He added that the most important criteria of evaluating any property is to study supply, demand, prices in the market, specifications, age and the location of the building .
Dubai plans to simplify property contracts D
ubai plans to introduce a simplified contract that would become the norm for all property purchases in the emirate. The standard contract, which has been drawn up by the Land Department and awaits approval, will clearly set out terms for both buyers and sellers, said
Emmad Eldin Farouq, Senior Legal Advisor at the department. “In any contract, there is a chance a developer can add to it because different developments have different rules and regulations but the basic contract will stay the same,” Mohammad Sultan Thani, Assistant Director-General of the
Land department, said. Dubai’s Real Estate Regulatory Agency (RERA) and the Land Department are working hard to make the property sector more watertight but insist that there must be a large onus on the buyer to read contracts in full. During Dubai’s boom times,
He also said that qualifications, practice and experience are very important in the process of licensing real estate valuers; and that by RERA cooperating with RICS and many other high level international associations, this will help to increase the level of practice to the best international levels. He added that there will be a code of ethics, records and procedures that will be required to be followed by all valuers. Existing valuers have discussed their ideas, as well as given their opinions, in regulating this activity. Banks and financial institutes will be one of the most interested sectors in this activity as they depend on valuations to deal with real estate financing such as mortgages and loans. Yousif Al Hashmi, Director of Real Estate Licensing Department assured all that his department is preparing new conditions and requirements for getting the licence. He warned against people who represent themselves as real estate valuers while only having a brokerage licence.
many investors came swarming to Dubai just to buy property and paid less attention to contracts than they would in more mature markets. “Any contract should be very clear and we need to make sure people read the contracts carefully,” stated Thani.
Index to put school rents on level playing field launched by KHDA and Rera schools can vary significantly, which in the case of private schools has a knock-on effect on the level of tuition fees. The new scheme, which will involve the development of longterm rental contracts, is intended to smooth out such disparities and inconsistencies. The authority believes the unified index will assist private schools and investors and support them in confronting unjustified rent increases. The scheme is also intended to ben-
His Highness Sheikh Mohammed Bin Khalifa Al Maktoum, Chairman of Dubai Land Department, received certificates on behalf of the government body for ISO 14001:2001 and OHSAS 18001:2007. ISO 14001 is a standard aiming to reduce the environmental footprint of a business and to decrease the pollution and waste a business produces. OHSAS 18001 is an ‘Occupational Health and Safety Management Systems Specification’ which covers issues such as planning for hazard identification, risk assessment/control, OHS management, awareness and competence, training, communication, emergency preparedness and response, performance measuring and improvement. Sultan Butti bin Mijrin, Director General of Land Department described the certificates as a positive step towards action to upgrade and improve the environmental performance and health and occupational safety of employees as well as reflecting positively on the security and safety of workers. Mohammed Hamad Al Mehri, Chairman of the Group Environment, Health and Safety Service noted that “The Land Department is committed to all international and domestic legislation in this area and related activities and operations.”
The unified index will establish appropriate levels of rent for different areas with a view to achieving stability in the rental market for public, as well as private, educational buildings
Sultan Butti Bin Mijrin, Director General of Land Department received Mr. Ali Bin Abdullah Al-Abbas, Director General of Internal Trade, the Ministry of Commerce and Industry Saudi Arabia as the head of a delegation that included a number of Saudi businessmen, to become acquainted with laws and legislation governing the real estate sector in Dubai and in particular the escrow account and mechanisms for organising and managing this account.
Dubai Land Department hosted a government departments award ceremony in partnership with Dubai Municipality recently. Ahmed Al Shehhi, Director
Land Department received a delegation from Dubai Police in the context of strengthening partnership and cooperation between various departments and state institutions to develop government services. The visit was to identify, review and share experiences particularly with regard to service and customer care. The meeting was attended by Khamis Al Muhairi, Director of the Department of Customer Service; and Mohamed Oe, Deputy Director of Strategic Management and Excellence
efit parents. The KHDA will contribute to the rent regulation and contract registration processes and in addition identify rented units and determine their usage, the facilities attached to them and the clauses and conditions of rental contracts. The agreement covers universities and training institutions as well as schools. 72 per cent of the total number of private schools in Dubai have rental agreements, which is 103 out of 144 schools.
of Partnerships, Dubai Municipality, reviewed the accomplishments of administrative excellence award winners which foster and encourage the importance of excellence among all staff, and then was astounded to win an award himself. He explained that achieving excellence is not difficult as long as there is a genuine desire and determination from within the staff member. He revealed secrets of success and excellence in his career through plans and objectives, personal commitment, responsibility and the pursuit of excellence, which earned him an honour in the Dubai Government Excellence for 2008 programme. Juma bin Humaidan, Deputy Director General, Land Department, congratulated Masoud Rashidi and commended her on winning a bronze medal for fourth position at the new athletics race held at Bundesliga, Germany in early July.
DUBAI REAL TIMES
rental index for schools and other education centres in Dubai is to be developed following the signing of an agreement by the Knowledge and Human Development Authority (KHDA) and the Real Estate Regulatory Agency (RERA). The unified index will establish appropriate levels of rent for different areas with a view to achieving stability in the rental market for public, as well as private, educational buildings. At present, rents for adjacent
Real estate valuation By Mouaiad Al-Omari, Edited by Mohamad Khodr Al Dah
eal estate valuation (REV) is considered the cornerstone of the real estate sector, and one of the important factors that affect the lives of individuals, as well as the economy. Lending, borrowing, buying, selling, investing and real estate acquisition decisions depend directly on the value of the property.
The Concept of Real Estate Real estate means the land and everything that is attached to it, such as buildings. Legally, real estate means the land and anything affixed to it and cannot be moved without damage or change to its structure. So, land covers not only the surface soil, but also every natural connec-
valuable minerals etc., to the infinite sky, with some limitations in relation to the height of structures.
The Concept of the Value The capitalist economy is based on the price mechanism. This means that there is a price for everything and there is no economic activity without a price. This means that money evaluation cannot be known without having a price to know this value, and the value cannot be known without evaluating things. Thus, the price is the standard that defines the value of things. From the capitalist point of view, the price mechanism is the fair way for distributing goods and services. For example, there are only a finite number of houses in the world, so
The real estate value depends on various factors such as area, location, type, use of property, title of ownership, size, condition, and legal status in terms of transfer of ownership, market conditions, supply, demand and many other data for an accurate appraisal of the property. This value is the opinion of an independent, experienced, educated, professional, honest, trustworthy expert who follows scientific principles and varied professional methods to approach the property value-whether the land is vacant or built-up.
Real Estate Valuation Real estate valuation forms the basis for almost all activities relating to the land surface, and is one of the mainstays of the real estate market, in addition to land surveying, land regis-
BIOGRAPHICAL NOTES Sky
DUBAI REAL TIMES
Centre of Earth
tration, and land use. It is the process that provides the indicator to land and improvements value. Hence, the failure or mistake in real estate valuation in terms of the ability to reflect the reliable value of the property in a way that is appropriate for accurate decision-making can result in serious risks. Therefore, real estate valuations in the absence of supervision by competent authorities, and depending on non-specialists who implement wrong valuation methods can result in wrong values. This will cause turbulence in the property market (e.g. banks, investors, and customers) and will adversely affect the national economy and will ultimately affect the global economy. The worldwide economic crisis that happened in the second half of 2007, starting with the United States, is a clear example.
tion to it (except water which is governed by special laws) like trees; and any improvements such as all kinds of construction below or above the surface. Land ownership, according to the theory of the inverted pyramid or the carrot (Fig. 1), contains not only the surface, but extending from the centre of the earth to specified limits and signs on the surface, with the exception of the natural deposits such as oil, gold, and other
who has the price of the house can afford to own the house. The same meaning can be applied to cars, milk, bread, and so on. Based on this, there is a need to convert everything to money to facilitate owning it. Hence, the basis of real estate valuation is to convert the property to a financial number (the value), to form the capital which is the main engine in the process of economic development.
Mouaiad Al-Omari Born in 1963; obtained his diploma degree in 1982 as Eng.-Assistant in Surveying; obtained a bachelor degree in 1996 in Business Administration and Computer Science from Yarmouk Uni-
versity, Jordan; obtained a master degree in 2005 in Land Management and Land Tenure, from Technical University of Munchen, Germany. Until 2005 he was a Property Valuer in the Department of Lands and Survey in Jordan, then a Head of Real Estate Appraisal Directorate in the same department until 2007. Since 2007 until now he is preparing for a PhD in Real Estate Valuation at Oxford Brookes University in the UK under the supervision of Dr. Peter Dent and Mr. Richard Grover. Since 2009 until now he is the Project Manager of Real Estate Appraisal Centre in Dubai Land Department / Real Estate Regulatory Agency (RERA).
Traditional meets modern man
f true leadership is a faith, dedication and lifestyle, then a man doesn’t need a very high position to become a distinguished leader in his professional team. This theory may be applied very well to Mohammed Rashid bin Serdah, Director of the CEO’s office at RERA. He can be considered as a unique personality in whom traditions meet modernity. The story of Mohammed Rashid takes many different turns beginning with his bedouin lifestyle and the change he added to his life by working at the Land Department and then RERA, as well as his unique outlook on life and its ethics. Mohammed Rashid graduated from Dubai College of Higher Technology with a diploma in Business Administration, however he did not put this degree to use until 2004. Prior to this, Mohammed Rashid remained free from work, spending most of his time in the desert practicing his favourite hobbies of falconry and shooting. He joined the Land Department in 2004 as a secretary for the deputy Director General, then as the secretary for the Director of Technical Affairs. He ended up working in the compensation department. In this team he proved his loyalty, dedication and he gained the trust, as well as appreciation, of his bosses resulting in many offers for him to progress upwards. However, Mohammed Rashid’s passion for working with Eng. Marwan bin Ghalita, RERA CEO, based on the respect and equality with which Eng. Bin Ghalita treats all of his employees, kept him as his office manager despite the fact that this kept him on a lower pay scale. His experience
Mohammed Rashid bin Serdah
with Eng. Bin Ghalita has made his personality richer with knowledge, expertise and refining his people skills. He began working as Director of the CEO’s office in 2008, being extremely busy setting the foundation for RERA, a new establishment that required much attention and care. Then he received the Unknown Soldier Award from the Dubai Government Excellence programme which was predictable considering his valuable contributions to the Land Department. His work as the director of the CEO’s office involves following up with the CEO’s directions and their execution, communicating with other departments, and coordinating between these departments and the CEO’s office. Mohammed adds that working in this position
requires a very trustworthy and reliable individual because you deal with many sensitive and important issues. His belief in RERA’s role in regulating the real estate market, protecting investors’ rights, and his belief in the team’s ability makes him proud to be a part of this agency that works along with other government bodies to improve Dubai and its image. He admits that the government work has changed his vision of Dubai and made him understand what a lot of hard work lies beneath Dubai’s accomplishments. Asking him about his strengths and weaknesses, Mohammed Rashid said he is quick to act and make decisions; and, by asking the people who work with him, we discovered a very high class individual
who has a strong work ethic with a concentration on honesty and trustworthiness for colleagues and friends. The desert takes up much of Mohammed Rashid’s time; he is a good shooter, he hunts with falcons, likes camel races, farming and taking care of camels. As well, Mohammed Rashid loves sailing. He loves to read about history and be religiously educated, spend time with his wife and children who are very understanding of his work schedule and provide him with stability at home. He gives credit of his great personality to his mother and father who raised him in the many beautiful Arabic traditions with the Islamic religion and good ethics too. He considers raising children by being a good example to be the best means of parenthood. He is always a friend to his son and daughter. Mohammed Rashid doesn’t believe in having one idol. He thinks that a man should take the best in everybody and he should become an idol himself, to force his good personality on people and to see God in everything that he does. He who does this does not need to look for an idol in another man. The last word, for his colleagues in RERA, are to cooperate and to complement each other because every member in this family completes the other – and we are all here to serve the community that we are a part of. If we can no longer do this, we should leave our place in this house for one who deserves it. Of course there will be more another day about this amazing man that has a lot of wisdom, is humble and dedicated.
DUBAI REAL TIMES
By Amal Abdul Rahim Al Sahlawi
Transactions during June 2009 The total value of real estate transactions in Dubai during June 2009 was Dh13 billion Land 895 8,905m 12,842,000
Total number of Transaction Total value AED Total Area(sq.ft)
Flat 2545 2,448m 70,955,000
ad Al Sheba had the highest number of land transactions with 221 sales completed. The total number of mortgage transactions was 265 with a total value of Dh2,525million for 4,782,000 square feet. Of these Arabian Ranches had the highest number of mortgages with 32 such transactions taking place for accommodation there. The total number of sales of apartments was 2,309 with a total value of Dh2,113million for 2,412,000 square feet. Jebel Ali had the highest number of these sales with 844 transactions taking place. Villa sales included a total of 146 mortgage transactions with a total value
Villa 203 361m 641,000 1000
Total Number of Flat Sales Transaction
162 84 28
Jebal Ali Warsan First
Sheikh Sayed Road
Palm Al Suooh jumeirah Third
Total Number of Villa Sales Transactions
Dubai Emirates Emirates Marina Hills Hills Second First
Nad Al Sheba
Emirates Arabian Emirates Emirates palm Bu Hills Ranches Hills Hills Jumeirah Kandra Third First Secound
Mirdif Al Kiran First
Total Number of Land Mortgage Transactions Top 10
22 20 17 15 11
0 Arabian Ranches
Emirates Aud Al Aud Al Al Barsha Al Warqa Al Al Qouz Hills Muteena Muteena South Third Khawaneej Second First second First First Third
Emirates Hills Second
Emirates Hills Third
Emirates Al Barsha South Hills Second Second
in the Sheikh Zayed Road area, which went for Dh88.9million. A 52,366 square feet plot in the Mirdif Area was acquired for Dh13million, while 38,068 square feet at Al Khabeesi was disposed of for Dh17.13million.
Motor City Sheikh Sayed Road
Trade certre second
of Dh274million for 458,000 square feet. Emirates Hills had the highest number of sales with 72 transactions taking place valued at Dh98million for 209,000 square feet. During the second week in June the biggest area sold was the 65,849 square feet
Total Value of Villa Sales Transactions (Million, AED)
Emirates Hills ThirdArabian Ranches Emirates Hills SecondDubai marina
Motor City Sheikh Sayed Road
DUBAI REAL TIMES
Total Number of Land Sales Transaction Top 10
Let’s believe in the Dubai brand Investors await confidence boost prior to revival
DUBAI REAL TIMES
urther real estate legislation, greater transparency and more accurate and timely market information are required to rebuild confidence in Dubai’s real estate market and stimulate investment. These were the conclusions from the expert panel at the third Cityscape Connect Business Breakfast, which attracted nearly 200 senior real estate industry players in early July. Cityscape Connect is the notfor-profit initiative from global real estate event and business information company Cityscape. It is designed to stimulate networking and information sharing and acts as a year-round platform to discuss business-critical issues in the real estate industry. “Sentiment drives markets, and sentiment is important to the recovery of Dubai’s real estate market,” explained Ian Ohan, Head of Investment Transactions at Jones Lang LaSalle and moderator of the panel discussion. The global economic downturn has dented investor confidence. Banks are unwilling to lend money to real estate investors and developers, concerned at the likelihood of defaults, while investors worry about falling values and the ability to let commercial or residential buildings. As a result, banks and investors have become very cautious with many preferring not to invest, despite having available funds. Those that do invest focus on secure income producing assets rather than seeking high risk-high return strate-
(left to right) Heather Wipperman, CEO of Investment Boutique; Markus Giebel, CEO of Deyaar; Ian Ohan, Head of Investment Transactions at Jones Lang LaSalle; Duane Keighran, Deputy Head of Real Estate, MENA region, at Simmons & Simmons and Marwan Shehadeh, Managing Director of Al Futtaim Capital
gies. The issue is risk aversion. Investors are worried about risk. We need the banks to invest once again and the funds to employ money. But there is no clarity of the future, so liquidity will remain on the sidelines until confidence returns,’ explained Marwan Shehadeh, Managing Director of Al Futtaim Capital. “‘Real estate is about supply and demand. People are only willing to invest where they see a clear shortage in supply. In Morocco and Egypt, for instance, there is a shortage of middle income housing. But in Dubai there is a lack of clarity regarding supply and demand in the real estate market.’ Heather Wipperman, CEO of Investment Boutique called for more
Banks are unwilling to lend money to real estate investors and developers, concerned at the likelihood of defaults, while investors worry about falling values and the ability to let commercial or residential buildings
reliable and timely statistics to be made available. She suggested that Dubai’s developers, brokers and mortgage banks pool their data to create one independent central source of real estate statistics to increase transparency, and therefore confidence and credibility, in Dubai’s real estate market. Improving real estate legalisation will also increase transparency and increase confidence, added Duane Keighran, Deputy Head of Real Estate, MENA region, at Simmons & Simmons. “Dubai needs to import best practice from maturer countries. For instance, it is difficult to get a judgement on a real estate court case. Nor can you do a real time search to find out who owns land. Such changes will add trans-
parency and attract institutional investors.’ However, Markus Giebel, CEO of Deyaar, defended Dubai. “You must remember that Dubai is still an emerging market, and emerging markets don’t have legal frameworks so Dubai is having to catch up. Can we change Dubai from an emerging to a mature market in 12 or 24 months? Probably not, but we are making the right tracks.” Martin Seward-Case, Chairman of the UAE branch of the Royal In-
stitution of Chartered Surveyors (RICS), supported Giebel’s view. He told the audience that the RICS was supporting Real Estate Regulatory Agency (RERA) to establish ground-breaking changes behind the scenes. “RERA are doing a fantastic job; we’d only hope that they continue to remain bold and impartial - where possible - avoiding significant influence from master developers.” In terms of a recovery in the real estate market, Wipperman
said Dubai still “had some way to go,” but she predicted a change in fortunes at the end of 2010. “‘Institutional investors are looking at the existing supply of real estate, the anticipated supply to come on line, population statistics and the health of the business community. But, in Dubai we still have a way to go on all of these factors.” Wipperman said any recovery in Dubai would at first be patchy; focused particularly on neighbourhoods. “Certain pockets of Dubai
are more robust. The southern area of Dubai is more resilient and we’re getting closer to a price equilibrium, particularly in Dubai Marina and Discovery Gardens.” But to reach a recovery, Markus Giebel, CEO of Deyaar, stressed that Dubai must continue to invest and improve as a city. “It is important to continue to spend on infrastructure, safety etc. It is these things that make Dubai a great city. Let’s trust in Dubai, believe in Dubai and continue to build Dubai.”
Funds aplenty for distressed buying
the money. Everybody realises that there may be further downsides and is waiting for the bottom. The issue with Dubai is that there is still a lack of clarity in terms of the amount of supply and demand, and that is what real estate is about. People are only willing to invest where they see a clear shortage of supply.” With developers in the emirate looking to diversify their business models to adapt to the new realities in the market, some are looking at the options of using their funds to buy back units in their own developments. These units can then be used to provide recurring income
from rentals while developers wait for prices on the market to begin to rise again, before releasing them for sale. “Now is a great opportunity for developers to take back well valued assets and hold on to them while the market settles, say two or three years until we see appreciation, and then sell them on,” said Giebel. “If we recover units from investors who have to opt out as they can no longer make the payments, and then sell them straight on at less than the bottom end of the market, we will only serve to destabilise prices even further, which does not
help anybody.’ Giebel also told attendees that Deyaar expected to begin raising the outstanding Dh300million of capital for its Dh500million distressed debt fund within the next few weeks. The developer and Dubai Islamic bank have already put Dh200million into the fund. Deyaar is also looking at investing into international markets as part of its longer term strategy. As well as being close to agreeing a deal in Lebanon and Saudi Arabia, the company would be examining opportunities in ‘high risk, high reward’ countries such as Iraq.
DUBAI REAL TIMES
ndividual investors and institutional funds have available liquidity, but are holding off on investing in assets in Dubai due to the lack of clarity as to the true situation on the ground, according to a panel of industry experts. Despite this short term gap, the emirate has the fundamentals to attract international interest in the medium to long term. While no significant distressed funds are yet active, the few in the pipeline are likely to increase confidence in the market and rescue defaulted assets. “Although there have been ‘distressed’ sales by individuals, a number of investors have been helped by a number of easy payment plans and similar initiatives by developers,” said Markus Giebel, CEO of Deyaar. “Real distress will come when developers stop these plans, and the misfortune for those who cannot pay is an opportunity for these funds - and the funds will come, that’s for sure.” Fellow panellist Marwan Shehadeh, Managing Director of Al Futtaim Capital agreed, pointing out that the majority of the group’s property fund has yet to be spent. “The issue is risk aversion; it’s no longer liquidity. We have plenty of money, but where do you put it? Two thirds of our fund is not yet deployed. There is a lot of uncertainty in the market, and there is no pressure from our investors to spend
The property surveyor typically is known as a Valuation Surveyor or possible a building surveyor
DUBAI REAL TIMES
he Royal Institution of Chartered Surveyors (RICS) wholeheartedly supports RERA in their quest to protect the rights and interests of consumers. The RICS also shares RERA’s vision that Dubai property investors are assured the highest possible service standards from real estate agents, brokers and property developers transacting business in Dubai whilst maintaining the integrity of all the developments. In late 2008, the RICS was pleased to sign Memorandum of Understanding with RERA to share best practice in real estate matters. We catch up with Martin SewardCase, Chairman of the RICS UAE Board to ask him a few questions as to what Chartered Surveyors do in the UAE, and advise on how to avoid another disastrous property bubble in the future.
What does a surveyor do?
What is a surveyor?
Before buying a property (yes, to ascertain its value as well as its state of repair), during the buying process (yes, to help you in the transaction process), after the property is bought (possibly only to assist in calculating the cost to rebuild for insurance purposes)
It’s a term that has changed dramatically over the last few years. Traditionally the surveyor was seen to stare through a level at another site technician holding a staff. While this activity still continues on construction sites, the chartered surveyor will study a property, any construction related problem, and provide advice too.
This depends on the discipline. A Valuations Surveyor will provide an educated and professional opinion on the value of a piece of real estate. Banks use these valuations to base their lending decisions. Construction Cost Surveyors are known as Quantity Surveyors and they look after the cost and contract administration involved in building the project.
What is the job of a home/ property surveyor? There is no designation as a home surveyor. The property surveyor typically is known as a Valuation Surveyor or possibly a building surveyor .
When should one enlist the help of a surveyor?
What will the surveyor do at each stage of the buying
process? This depends on the sort of surveyor one is looking for. Usually enquiries are answered with a fee set against a series of separate and distinct functions outlining exactly what is being asked for and what sort of report or recommendation will be provided for the fee itself.
What should you expect your surveyor to do for you? Provide clear unbiased advice.
What types of surveyors are there? (ie, those of relevance to potential homebuyers.) We have 17 different disciplines that form the 140,000 Chartered Surveyors worldwide. These disciplines advance the standards of processes in land, property and construction. The potential homeowner needs to know that valuations, State of the Property and rebuild cost estimates (for insurance purposes) should all have the involvement of a specialist chartered surveyor.
When would you need to enlist their services? The potential homebuyer should
ultimately involve a chartered surveyor if they have any nervousness regarding the processes they are being required to sign up to. As he is duty bound to primarily protect the interests of the public, he will be best placed to advise whether further specialist services may be required (structural survey, etc).
When buying a property, why should you enlist the services of an independent chartered surveyor? The chartered surveyor is duty bound to provide clear impartial advice whether it be for the valuation of the house or apartment or the condition that it is being sold in. The answer may not necessarily be what one was hoping to hear but it will be fair and reasonable and reflect the full circumstances of the purchase.
Don’t banks/mortgage providers use surveyors, anyway? Isn’t that enough? Typically yes it should be enough, however, the purchaser should check that this is the case. It is not mandatory in the UAE for chartered surveyors to be used as part of the transaction process, however the purchaser (or seller) can have significantly more peace of mind if a one
What is a home condition report? Is it required in the UAE? It does what is says on the box. Currently it’s not mandatory but we’d recommend that it is put in place. As the secondary market matures and homes start aging, this report protects both parties in that an independent surveyor has created it.
What can Dubai do to avoid another property bubble in the future?
More relevant regulation
has been involved in the correct part of the transaction.
What questions should you ask a surveyor?
• • • •
In buying home typically : Is the property I’m purchasing true “unencumbered freehold”? Does the seller actually own the property? Is the price we’re agreeing on the right price? Are the charges I’m being asked to pay the correct level of charge?
What is RICS? RICS is the world’s leading qualification when it comes to professional standards in land, property and construction. RICS is an independent professional body originally established in the UK by Royal Charter. Since 1868, RICS has been committed to setting and upholding the highest standards of excellence and integrity – providing impartial, authoritative advice on key issues affecting businesses and society. RICS
is a regulator of both its individual members and firms enabling it to maintain the highest standards and providing the basis for unparalleled client confidence in the sector.
What is the advantage of using a RICS surveyor? Primarily, peace of mind. However, chartered surveyors also carry professional indemnity insurances to cover the unlikely instance of the advice provided not being correct.
What’s the difference between a valuation and a building survey? The building survey looks at the condition of the building and recommends what needs to be done to make it habitable. The Valuation looks at the market value of the asset.
If you want to make an alteration to your property, why is it important to enlist a RICS surveyor?
Many exponents of free market principles will not openly support the notion of public institutions placing regulations onto an open growing market. However if we consider how the low levels of regulation in the banking and financial services sectors have directly contributed towards the financial meltdown of Q4 last year, we now see those very services themselves admitting that greater regulation will indeed have taken the edge off the collapse we have now witnessed. In Dubai, the recent bubble raced ahead of us as the speculation cycle took hold. With RERA’s now strong position on speculation we’re seeing far more sensible level of regulatory mechanisms in place to ensure we don’t fall into the same trap. With RERA now in place it’s unlikely that we will see another bubble growing at the speed that we witnessed – and this is a good thing. It is all about sustainability. Growth is important, but growth in a sustainable manner.
Lower barriers to entry to allow in greater competition These barriers to entry include the
prohibitively expensive cost associated with the establishment of a Consultancy Practice or General Contracting concern. By lower entry costs smaller business can enter the market and keep competition healthy in the event that the sector in particular starts to heat up. We had several instances of small to medium size contracting concerns from the UK and South Africa make enquiries during 2007 and 2008 but were put off by the cost and bureaucracy related to establishing the concern. It is pleasing to note that at both local and federal level, the authorities are starting to look at this now.
Supply chain responsibility in pricing During the recently witnessed upturn, opportunism by the supply chain is one of the most regrettable but significant contributions towards inflationary pricing we have seen. Clearly resource restriction will contribute towards inflationary pricing however the attitude of “…it’s not the cost of the service but the price we know we can get away with…” obviously prevailed in the UAE market during the 2006 – 2008 upswing. While consultancy man-hour charge out rate increased dramatically it was the “Cost plus: take-it-or-leave-it” approach by many contractors that was most regrettable. Whilst the developers clearly signed up to contracts with values provided by an opportunistic supply chain, many of these organisations have now banked these ‘super profits’ and are crying foul. In future the entire supply chain should be more responsible in not creating or contributing towards the perception of profiteering. The supply chain should use a ‘bottomup pricing approach’ where the cost of the service is supplemented by a reasonable level of economic profit. Martin Seward-Case is a Chartered Quantity Surveyor and Partner with Reaction Project Management, a consultant providing Project and Cost Management advice to developers, contractors and other consultants. Martin was elected by the RICS UAE Membership to Chair the RICS UAE Board for 2008 / 2009.
DUBAI REAL TIMES
It’s wise to involve a chartered surveyor to ensure your rights and obligations under your ownership are fully understood. Equally in the event that alterations to the apartment or semi- detached dwelling are in any way associated with a commonly owned wall, it is essential that a chartered surveyor is involved to put steps in place to protect both party wall owners.
MARKET TRENDS & ANALYSIS // PROPERTY FINANCIAL ROUNDUP PRICES
DUBAI REAL TIMES
t is clear to everyone that people should talk to each other to discuss mutually beneficial ways of organising their money. Developers, bankers and buyers need to discuss options to what can often seem like an impasse, when outside financial problems affect all and sundry irrespective of their colour, class and creed. Buyers welcome an understanding attitude when discussing how to maintain payments on their purchase even when they cannot manage to pay what was originally agreed upon – such a long time ago, at least eight months or so in the past. Developers would like to get some money into their coffers, any reasonable amount will do to stave off the spectre of bankruptcy. Dubai-based Deyaar Development has announced continued partnerships with leading banks to offer financing options exclusively to its customers, including up to 90 per cent financing and repayment periods of up to 25 years. Deyaar customers, subject to meeting the bank's credit approval requirements, will be able to obtain special financing schemes and favourable repayment terms and quicker approvals, the bank said. Markus Giebel, Chief Executive Officer of Deyaar Development has said the company, along with Dubai Islamic Bank, has secured Dh200million from regional investors for a new distressed asset fund that will buy property from buyers who default on their payments and hold onto the units for several years, reselling them for a profit in the future. He said the creation of the fund was the final step in a strategy to lower the company's default rate from about 50 per cent to the low single digit range.
Dubai Islamic Bank (DIB) has announced that it is offering up to 90 per cent financing for properties across the UAE. Property buyers can avail of Al Islami Home Finance for up to 25 years for ready and underconstruction properties from approved developers. This financing is available to both UAE nationals and expatriate residents. DIB is also offering refinancing solutions for properties that are already completed. Dr. Adnan Chilwan, Chief of Retail and Business Banking, DIB, said: “The security of owning a home in the
Dr. Adnan Chilwan
UAE provides great comfort to our customers. With a high finance to value ratio and a range of products to suit every need, we encourage homebuyers in the country to take advantage of this opportunity.” Nakheel has said that it is offering its customers discounts of between 10 per cent and 30 per cent to help investors meet their commitments and obligations towards the company. To qualify, buyers will have to settle outstanding balances and continue to pay their instalments on time, and the scheme is available to customers who have bought in Jumeirah Island Mansions, Jumeirah Heights Clusters, Badrah phases one and two, Marina
Residences and Veneto. Nakheel has also announced a new, lower service charge budget for its Discovery Gardens community, following a detailed review of scope and suppliers. The new rate has been formally agreed with the Dubai property market regulator, RERA, and will mean a reduction of approximately Dh5 per square foot in service changes for homeowners. The new lower service charge rates will be backdated to 1st January, 2009, with any rebates for householders being credited against next year’s service charges effective from 1st October, 2009. Abdulrahman Kalantar, Managing Director of Nakheel Asset Management and Design (NAMAD), said: “When we first set the service charges for Discovery Gardens, they were based on our best estimates for this new Nakheel community. Following a lengthy review, we have been able to take advantage of recent reductions in the cost of goods and services, which has in turn reduced our overall service charge budgets. We’re now delighted to pass on these cost savings to every homeowner at Discovery Gardens.” Presently, across Nakheel’s devel-
opments, including Discovery Gardens, service charges are budgeted according to projected costs and all accounts are independently audited to ensure accuracy and transparency for homeowners. Nakheel works with RERA, residents and suppliers to ensure that the charges are in line with market averages. Following the introduction of Strata Law in April 2008, Nakheel made the necessary preparations to register the Owners’ Association with RERA once the regulations are finalised by the Dubai Land Depart-
Dubai-based Deyaar Development has announced continued partnerships with leading banks to offer financing options exclusively to its customers, including up to 90 per cent financing and repayment periods of up to 25 years
Old Town Island at Burj Dubai
renew the rental lease if they do not decide to purchase the home after one year. The Rent-to-Own scheme, launched by Emaar in November 2008, has gained strong response from customers, who benefit from the convenience of staying in a home of their choice for one year before making a purchase decision. With the entire rent of the year going towards down payment, the scheme also presented a financially beneficial option. The residences showcased as part of the programme are located in the residential clusters of The Old Town, Old Town Island, South Ridge and The Residences, all established communities with an array of lifestyle amenities. South Ridge and The Residences are impressive highrise towers while The Old Town and Old Town Island feature elegant Arabesque architectural features. The newly released units include one- to five-bedroom apartments with either large terraces or balconies. All the homes have upgraded finishes. All homes offered as part of the Rent to Own scheme are near Burj Dubai, the world’s tallest building, and residents only need to take a short stroll to watch The Dubai Fountain, the world’s tallest performing fountain and a spectacle that performs to popular Arabic and World music. Dubai Investments Real Estate
The home finance options will cover an extended portfolio of Emaar projects including apartments and villas in Dubai in prime locations such as Downtown Burj Dubai, Dubai Marina, Arabian Ranches and Emirates Living.
Company (DIRC), the real estate arm of Dubai Investments, is giving a 100 per cent refund to its investors on the Mirdiff Hills project, which it has put on hold due to unavailability of mortgage financing. Khaled Kalban, Managing Director and CEO of Dubai Investments has said DIRC would continue with the project should the lending scenario improve in Dubai. Eng. Hussein Nasser Lootah, Director General of Dubai Municipality has issued a decision cancelling the insurance amount, which was required at the time of approving building plans. Lootah said that the Municipality has, through this decision, tried to reduce the efforts exerted for the process of payment and receipt of insurance so as to save the time and effort of customers. "At the same time it will also save
the customer’s financial burden and facilitate procedures in light of the current situation." As per the clauses of the decision, the insurance on transactions regarding the approval of plans, imposed on the owners when they submit applications for building permits, has been cancelled. It was a fee submitted, along with building plans, which was acknowledged by the competent department to issue a building permit. The owner receives the difference between the acknowledged fee and the estimated fee which must be met in the light of accounts of the building, during the final approval of the plans. Previously the owner had to pay an insurance amount related to plan approval, which was equal to the set of fees that must be met for the issuance of a building permit.
DUBAI REAL TIMES
ment (DLD). As master developer, Nakheel will ensure that the owner associations are established in a timely manner, together with the creation of an owner’s committee which will empower residents to actively participate in the management of their building. Emaar Properties has partnered with Standard Chartered Bank to extend two easy home finance packages for all its projects in Dubai that will be delivered in the next nine months. Standard Chartered Bank will offer two mortgage products – the Asset Back Lending (ABL) Product and Standard Mortgage Product (SMP). The Asset Back Lending (ABL) Product offers an easy loan of up to 40 per cent of the property price with a mortgage of Dh100,000 to Dh2.5 million being provided for a tenure of three to 25 years. The Standard Mortgage Product offers a standard loan of up to 75 per cent of the property price. Potential endusers and customers can obtain financial support from Dh150,000 to Dh10 million for a tenure of three to 25 years. The home finance options will cover an extended portfolio of Emaar projects including apartments and villas in Dubai in prime locations such as Downtown Burj Dubai, Dubai Marina, Arabian Ranches and Emirates Living. The ABL easy loan is particularly tailored for current investors and end-users seeking financial support to complete the remaining payments before handover, while the standard mortgage will appeal to all potential home-buyers. Mr Ahmad Al Matrooshi, Managing Director – UAE, Emaar Properties, said: “The partnership between Emaar Properties and Standard Chartered Bank is a huge confidence booster for Dubai’s property sector as it marks the strengthening of liquidity levels.” Emaar Properties has also unveiled a new portfolio of homes in its Rent to Own scheme within the Downtown Burj Dubai community. Customers can lease the ready-tolive-in residences for one year before making a purchase option, with the entire rent for the first year going towards the down payment. They can
MARKET MARKET TRENDS TRENDS & & ANALYSIS ANALYSIS //
The role of transparency in restoring confidence in real estate market By Craig Plumb, Director of Research, Jones Lang LaSalle (UAE) Jones Lang LaSalle’s second Invest- form and creating a transparent importance of improving sentiment ment Sentiment Survey (ISS) under- market will provide the surety that and restoring confidence in the real taken in March 2009. They asked investors require to re-enter the estate sector and a key component their sample of the regions leading market with the enthusiasm they, of this strategy has been to improve the openness and transparency ubai has been one of the real estate investors what factors once had. While Dubai saw a major im- of the market. It is in this area that fastest growing real es- they considered most important tate markets in the world in their decision to invest in a par- provement in real estate market RERA is playing a key role. There has over the last 15 years, ticular market – the results, which transparency between 2006 and been widespread industry support with Jones Lang LaSalle identifying are shown in the chart on this page, 2008 (scoring the world most im- for the raft of measures to improve Dubai (along with Dublin and Las highlight the importance of trans- proved market in its 2008 survey), transparency being implemented The Role of Transparency in Restoring Confidence in the Dubai Real Estate Market Vegas) as cities of growing influence parency, with improved regulation there is no doubt that the market by RERA including: far less than on the world stage back in 2001. AsDubai has been one of the fastest growing real remains estate markets in thetransparent world over the last 15 (along with Dublin and Las as Vegas) more mature markets such Aus-as • Availability of better quality we all know, the market continuedyears, with Jones Lang LaSalle identifying Dubai Role of Transparency Confidence the Dubai Estate Market citiesThe of growing influence on in theRestoring world stage back in in 2001. As weReal all know, the market market data through the REIDIN tralia, Canada, the UK and the US. to grow rapidly before reaching a continued to grow rapidly before reaching a ‘tipping point’ in the third quarter of 2008 as Dubai has been one of the fastest growing real estate markets in the world over the last 15 sales database and the Projects At a recent Cityscape Connect ‘tipping point’ in the third quartera result of the liquidity crunch which triggered a major global economic slowdown. years, with Jones Lang LaSalle identifying Dubai (along with Dublin and Las Vegas) as Progress Indicator breakfast, participants from differof 2008 as a result of the liquidcities of growing influence on the world stage back in 2001. As we all know, the market availability of capital was one reaching of the key ingredients the spectacular growth • Publication of regularly updated ent sectors real estate market ity crunch, which triggered a majorThe continued to grow rapidly before a ‘tipping point’fuelling inof thethe third quarter of 2008 as of the Dubaiofmarket and its abrupt withdrawal a major correction, with rentals a result the liquidity crunch which triggered triggered a major global slowdown. rental indices shared what economic they believed couldtobe global economic slowdown. and values having fallen in the order of 50% over the ensuing 9 months, returning • Improvements to the legal done to restore confidence to the The availability of capital was2007The levels in some sectors. The rapid turnaround in market conditions in Dubai has availability of capital was one of the key ingredients fuelling the spectacular growth of the Dubai andthe its old abrupt withdrawal triggered majoronce correction, with rentals The themarket truth of investment adage that a‘sentiment moves markets’. framework through new regulamarket and, again, transparone of the key ingredients fuel-demonstrated and values having fallen inlips the order of 50% over theare ensuing 9 months, returning to question now on everyone’s is ‘what strategies required to restore confidence and tions governing strata titles, Esency was identified as a key factor. ling the spectacular growth of the 2007 levelsDubai?’ in some sectors. The rapid turnaround in market conditions in Dubai has rebuild brand demonstrated the truth of the old investment adage that ‘sentiment moves markets’. The crow accounts, lease registration One of the participants summed Dubai market and its abrupt withquestion now on everyone’s lips is ‘what strategies are required to restore confidence and While the answer to this question will clearly vary across different stakeholders in the and mortgages up the general consensus when he drawal triggered a major correction, rebuild brand Dubai?’ across that the board, an improvement in • Better enforcement and imthe lack of market transwith rentals and values having fallenreal estate market, one theme appears commonnoted transparency critical to restoring confidence andacross sentiment. This was highlighted in the While the is answer to this question will clearly vary different stakeholders into the the proved mechanisms for real esparency had contributed in the order of 50 per cent over thefindings of Jones Lang LaSalle’s second Investment Sentiment Survey (ISS) undertaken real estate market, one theme appears common across the board, an improvement in Craig Plumb tate dispute resolution feeling of ‘delay and pray’ which ensuing nine months, returning toin March 2009. We askedtoour sampleconfidence of the regions leading real investors what transparency is critical restoring and sentiment. Thisestate was highlighted in the findings of Jones Lang LaSalle’s second Sentiment Survey undertaken they considered most inInvestment theirwas decision to invest in a(ISS) particular market improvements, currently characterising the – • Operational 2007 levels in some sectors. Thefactors and reduced market riskimportant being idenin March 2009.are Weshown asked our sample of below, the regions leadingthe realimportance estate investors what the results, which in the chart highlight of transparency, agreements on codes of meaDubai market. rapid turnaround in market condi- tified as the two leading influences. they regulation considered most importantmarket in theirrisk decision invest in a as particular – withfactors improved and reduced beingtoidentified the twomarket leading the results, which are shown in thethat chartesbelow, highlight the importance of transparency, surement and licensing proceThe good news is that the Dubai tions in Dubai has demonstratedinfluences. The company is certain with improved regulation and reduced market risk being identified as the two leading dures for real estate professionthe truth of the old investment ad- tablishing a solid regulatory plat- government has recognised the influences. T h e Im p o rta n c e o f T ra n s p a re n c y als age that ‘sentiment moves markets’. R e s u lt s f r o m J L L ’s 2 0 0 9 I n v e s t o r S e n t im e n t S u r v e y T h e Im p o rta n c e o f T ra n s p a re n c y The question now on everyone’s
R e s u lt s f r o m J L L ’s 2 0 0 9 I n v e s t o r S e n t im e n t S u r v e y
P l e a s e r a n k t h e i m p o r ta n c e o f t h e f o ll o w i n g f a c t o r s i n f l u e n c e o n y o u r d e c is i o n to in v e s t i n a p a r t i c u la r r e a l e s t a te m a r k e t / a s s e t c l a s s . Transparency
lips is “what strategies are required to restore confidence and rebuild brand Dubai?” While the answer to this question will clearly vary across different stakeholders in the real estate market, one theme appears common across the board, an improvement in transparency is critical to restoring confidence and sentiment. This was highlighted in the findings of
P l e a s e r a n k t h e i m p o r ta n c e o f t h e f o ll o w i n g f a c t o r s i n f l u e n c e o n y o u r d e c is i o n to in v e s t i n a p a r t i c u la r r e a l e s t a te m a r k e t / a s s e t c l a s s .
Re gu la tion /Le gisla tio n
DUBAI REAL TIMES
Re gu la tion /Le gisla tio n
M a rke t Risk
M a rke t Risk
Le ve l of R etu rn ( Re ntal I nco me )
Le ve l of R etu rn ( Re ntal I nco me )
Le ve l of R etu rn ( Ca pital G ro wth ) Le ve l of R etu rn ( Ca pital G ro wth )
A va ila b ility of E q uity A va ila b ility of E q uity
E xit S tra teg y
E xit S tra teg y
A va ilab il ity of P r od uc t
A va ilab il ity of P r od uc t
T ra nsp arTerancy C eorncy po/rCate Gor ate ve rn nsp/ ar or po Goan vece rn an ce A va ilaofbility A va ila bility D eboftD eb t
Cost ofCost D eboftD eb t 0 .0%
1 0.0 %
1 0.0 %
15 .0 %
15 .0 %
2 0. 0%
2 0. 0%
2 5.0 %
2 5.0 %
The continued role of RERA in improving the regulatory environment and market transparency will have a significant impact on the recovery of the Dubai Real Estate market. Continued transparency improvements through 2009 and 2010 will provide a foundation for stability ahead of what we believe will be a recovery of transactions and pricing levels in 2011.
A good turnout at the auction
herwoods Independent Property Consultants held an auction in early June featuring properties in The Palm, Dubai Marina, Downtown Dubai, Jumeirah Lakes Towers, and other locations in the UAE. The offerings covered a broad price range and featured a mix of ready-to-use, nearly completed and off-plan residential and commercial units, as well as a number of plots. On the night, however, just one plot of land was sold. “To be honest we knew it was going to be a real challenge to actually conclude a sale on the night of the auction. Before we started we said we would be pleased if there was a good turn out and if we succeeded in getting people in the room to bid. Just shy of 200 people turned up so this was a good result. On several of the Lots we also managed to get people to bid and came close on two of the Lots to the reserve level. So again this was satisfying,” stated Jeremy Mayhew-Sanders. “We did sell one unit immediately after the auction, Emirates Crown penthouse for Dh6million, and we are genuinely in discussions with three other buyers on two other Lots. Having said that we know there is still a lot of work to be done. We still have a way to go to get people to understand the auction process; and this is understood and will be worked on for our next auction. Price and confidence in the market
generally remain the main barriers and this is a challenge for everyone in the property industry. You can't hide behind the auction process, it's a public arena and open for all to see and judge and this should be seen as a positive move in an industry that is shrouded in gossip, rumour and hearsay! The lack of confidence in the whole auction process perhaps played a bigger part than I probably thought. The company had to reduce the number of properties on offer from 50 to 20 as many sellers were unwilling to accept lower reserve prices proposed by the company. We could not get to a level of reserve that we thought
would be of interest to the market with the sellers. That pricing has been the key issue.” Mayhew-Sanders explained. High expectations of sellers and bargain-hunting buyers seem to be the stumbling block for auctions currently. According to Mushtaq Ahmed, a Dubai-based businessman, properties with high reserve prices should not be in the auction market. His bid of Dh70 per square foot for a 6,142 square foot villa plot in Dubailand was the highest but did not meet the reserve price. “I came here to get a better deal. I don’t need to come here to get properties at market price. Why should I waste my time?” he said.
Expectations were high on Sherwoods to put lower-to-mid range properties on offer as industry experts felt that the absence of it caused the failure of an auction in May by another company which had offered three villas and one penthouse apartment in upscale areas of Dubai. Only one property, a three-bedroom villa in Arabian Ranches managed to draw buyers’ interest. It received a highest bid of Dh2.3 million, which according to organisers was below the minimum price the seller was willing to accept. However, Sherwoods auction did not offer lower-to-mid range properties. “We will definitely be holding another auction and this is likely to be in October or November,” stated Jeremy. “There are two types of buyers who we want to encourage into the room. Investors and owner-occupiers, people who want a set of keys and move in. Next time, for the investor, we will endeavour to get more inventory that has income. Both commercial and residential property that is currently let out and will provide the investor with ready income and a yield. For the owner-occupier we need to source property of low to mid-range values. More affordable stock. Another lesson learnt is to extend the marketing period to allow people more time to inspect the property and to ask questions about the auction process.”
DUBAI REAL TIMES
Linda Benbow asked auctioneer Jeremy Mayhew-Sanders, Head of Investment & Developments at Sherwoods, on what happened at a recently held property auction.
Human resources that will make you win Whilet the market focus has moved from ‘off plan’ to ‘resale’ many estate agencies are finding it hard to overcome the need for a new business model. Overlooking one of the key factors in their business - non-performance of staff - could be the toughest challenge. Cecilia Reinaldo, Managing Director of Fine & Country, explains how to identify the non-performance signs and to become resilient.
DUBAI REAL TIMES
t is a fact that in a real estate environment, we need sales. Without sales we are not in business. Non-performance has lead to the closure of many businesses recently, and although everyone believes it is the non-performance of the markets, I can assure you that in most cases, it is the non-performance of sales staff. In the previous issue of Dubai Real Times, the value of improving your market knowledge was highlighted as the first step to improving your sales ‘bottomline’. One of the underlying recommendations was that agents should dedicate two hours each week, educating themselves by reading and studying the wealth of information available on local and global property markets. Possession of this information will quickly translate in client acknowledgement of their newfound expertise. Conversely, I was in a hotel lobby and could not avoid overhearing a conversation from what I would presume was a relatively new entrant to the UAE property market, advising a group of evidently disillusioned businessmen “that the market will definitely go up” and “they are guaranteed to get dou-
The value of improving your market knowledge is the first step to improving your sales bottomline ble digit rental yields.” I will never know whether a deal was made! But, as the old saying goes if you think it’s expensive to hire a professional to do a job, wait until you hire an amateur (Paul ‘Red’ Adair). Here are a few points that estate agency owners should have a close look at:
Resources: In practical terms a few have the resources to take on extra financial commitment but, remember, when a company recruite a topagent, it uses its current resources to draw this high profile estate agent to join them. When the company does not supply the resources to assist the agent to do the job, the company is to be blamed for the non-performance of the agent. Lack of resources can include: Understaffing (admin and marketing support), Tools and equipment (website, computers, and advertising), Budget and Marketing material. Capacity: Non-performance becomes the result when the agent does not have the skill to perform the job. In real estate we often find that the agent does not have the ability to close the deal, or he does not know how to negotiate knowledge, skill and attributes are key to this business. There are certain activities that are essential for an agent in order to be successful, and the education approach must therefore focus on the ability to do the things that will result in generating an above average income. Previously, most business training became "manager-centered", focusing on teaching agents in a classroom
about what to say and do, and memorising what must be done. This method is fast changing back in favour of "agent-centered" and task-based approaches whereby an agent first performs role plays in the office to prepare them before they do it in the field. This is an excellent opportunity to interact with a senior agent or manager and to learn the finer skills of negotiating. Behaviour: The agent decides not to do certain tasks and simply ignores it. They ignore the guidelines prescribed by the company and sometimes deliberately refuse to cooperate with colleagues. One to one meetings with your agents will give you a closer understanding on the above. A close inspection might give you the exact reasons for underperformance. In the end we all need to go back to basics:- estate agents in the UAE need to learn to let go of the past. Holding back on the thoughts of the ‘big deals’ you made and the ‘record’ reservation forms you managed to conclude are never going to get you to where you are trying to be; and time immemorial has illustrated that these thoughts are the very same that will hold you back from here to eternity.
Transparency: the best surprise is no surprise By Aziz Valliani & Carla Polkinhorn
he concept of Settlement and Escrow services is not a new one. Over a century ago certain companies began routinely offering their services to sellers and buyers of real estate to assist them with the safe and expedient transfer of property and funds in accordance with local laws. Many countries around the world have some form of settlement services whether it is called Settlement, Closing, Escrow, Conveyance or Guarantee services. Basically these companies offer a failsafe way to document the terms of a closing and execute the instructions accordingly. The word ‘escrow’ has its roots in Middle English and old French and basically translates to ‘scroll’ which in today’s terms means ‘checklist’. In the 1930s, during the Great Depression, escrow accounts were implemented heavily in the United States to gather funds from property owners regularly to pay property taxes or loan amounts owed so that they would not fall behind on payments. These escrow accounts are still used in most, if not all transactions, as a means used to account for all costs associated with buying and selling property.
become more transparent to both the buyers and sellers. The agent creates Settlement Instructions that all parties sign off on detailing all material aspects of the agreement and the terms and conditions that must occur in order for the transfer of the property to be effectuated. He creates an accounting of all funds owed by the buyer, or the buyer’s lender, as well as the amount of funds due to the seller’s existing lender (if any) and both parties are required to sign off on this accounting for complete transparency. Lenders become more willing to transact on deals that accurately reflect the current ownership and financial details of the transaction. Deposits of funds or cheques for the
purchase of property are insured in bank accounts that are regulated and all property transfer details, including mortgage details, are documented and registered with the local authorities.
Best practices yield best results Recently, a buyer borrowed Dh 800,000 to purchase his dream home from a seller. The seller had an existing mortgage of Dh700,000 that he was supposed to pay off with the proceeds at close. Well, after receiving the funds from the buyer’s lender, the seller - for some reason - decided to back out of the deal and leave the country in a hurry, without even returning the buyer’s earnest money deposit. So the buyer is now required to make payments with interest on his Dh800,000 loan to the lender for a property that he does not even own. Best practices would dictate that all funds be placed with a neutral third party (Settlement Agent) right when the agreement is reached between the principals. If the seller decided not to go through with the deal, then the Settlement Agent would be compelled to return buyer’s loan amount of Dh800,000 to the lender and the buyer’s earnest money deposit. Settlement services of a neutral third party could have alleviated this problem for the buyer. This article was written by Aziz Valliani, Managing Director, & Carla Polkinhorn, Sr. enTrustee at enTrust & Title Ltd., www.entrusttitle.com. In addition to real property transactions, the company also provides Settlement Services for the transfer of personal property, business assets and rental or lease transactions. Non real estate settlement solutions are available for individuals or corporate entities. The same concept of having a neutral third party act as the intermediary between the parties is applied.
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In uncertain economic times the services of a Settlement and Escrow company are highly valued. Buyers know that their deposits of funds are safeguarded with the Settlement Agent -even if their sale and purchase agreements do not contain all the requisite items that are on the standard ‘checklist’ to properly close a property transaction. For example, buyers are generally expected to sign an MOU to purchase a property before the seller has signed; and it may be missing key elements such as the amount of sellers existing loan that is secured against the property, the amount of rent paid in advance by an existing tenant or the amount of strata fees that will become due. . The unbiased third party intermediary, neutrally monitors the specific requirements of each and every closing while overseeing and controlling the documentation that is required by local authorities, attorneys, lenders, insurance and real estate brokers. These various parties to the deal, whose representative industries have done their best to introduce initiatives that address the problems faced by the current economy, can rely on the Settlement Agent to become the cost effective checks and balances system during closing of a real estate transaction. Currently sellers are experiencing difficulty in finding qualified buyers who will risk making any deposit of funds into a transaction which may fail to complete. The trust factor has evaporated. The chances of a deal going through get much better when a Settlement Agent is involved. His best practices require that the details of the transaction
Investing for the long term Facilities management solutions and value-added real estate services take the spotlight as companies invest for the long term
DUBAI REAL TIMES
hile unprecedented global economic challenges have affected real estate and construction markets, several companies have managed to stave off extinction by harnessing all available resources that help improve competitiveness. The key to this approach, analysts note, is to invest in solutions and services that enhance long-term sustainability and improve operational efficiency. In the property sector, for instance, firms are taking proactive steps to counter the effects of diminishing demand by investing in facilities management solutions and other value-added real estate services, which are now a lot more accessible because of a more competitive pricing structure. “There had been a prolonged period of diminished construction costs as a result of reduced property demand and slow construction activities. The corresponding price corrections naturally reverberated across the real estate value chain, including facilities management solutions. I believe this is a very crucial situation wherein businesses must be able to correctly assess how they should be able to take advantage of competitive pricing structures to offset the effects of a slow demand,” said Sobhi Agha, General Manager, The Specialists. “Some companies capitalise on the low costs by optimising their construction activities. On the other hand, property owners, based on our experience, are investing more on products and services that enhance long-term sustainability such as facilities management solutions.
Either way, I believe they are making the right decision by focusing on the future. Demand gaps and fluctuating construction costs are shortterm issues and the best way to take advantage of the situation is to think long-term,” added Agha. Agha has revealed that the company has seen a significant increase in the number of developers and building owners that are now aggressively seeking suitable facilities management solutions and other complementary real estate services to boost business value and longterm prospects. Just recently, The Specialists has sealed an agreement to deliver sales, leasing and property management services to Dunes Village, a Dh300 million development in Dubai Investments Park. Agha also noted that the growing emphasis by
local authorities on green building regulations has likewise increased demand for the company’s energyefficient property management solutions. “It’s all about consolidating your business. Different economic situations present different challenges and opportunities. In this period of economic difficulties, property management solutions and other valueadded real estate services serve as important consolidating measures that definitely help developers and building owners boost business and asset value. Moreover, governmentled efforts to promote green building standards have likewise further enhanced the demand for the services that we offer. This is why business has remained upbeat as usual for us as our value-added real estate
solutions offer companies an opportunity to focus more on their long-term business prospects and abide by green building regulations,” said Agha. While costs of construction materials have previously declined by up to 30 per cent, recent reports show that they have recently jumped by 15 per cent. However, analysts say the fluctuating figures do not suggest anything concrete at the moment and may be the result of companies buying to replace stock, and not necessarily because of a sudden sharp surge in construction activities. “Things don’t change overnight. The best approach is still to prepare and invest in solutions that offer the best long-term value. In this regard, there have been several companies that are now reaping the benefits of adopting facilities management services through reduced maintenance costs, streamlined operations, energy efficiency, and long-term sustainability. Surely, such an investment puts them in a very good position to weather the downturn and, more importantly, capitalise on the excellent opportunities when the real estate and construction industries finally stabilise,” concluded Agha. The Specialists delivers a comprehensive range of services to cover all types of property transactions within both the commercial and residential markets, for lease and for sale. The company additionally offers comprehensive property management services to clients in the UAE, while it has also been expanding across other key markets in the Middle East, including Lebanon.
Middle income housing segment maintains price despite market slump
here is still a reasonable demand for middle income housing,” declares Ashok J. Galgotia, CEO of Triveni Builders and Promoters Limited, developers of the Dh80 million middle income residential development at La Fontana in Dubailand. And although some projects by other developers have been cancelled Galgotia is undeterred. “La Fontana has started its construction, and has never been in danger of being cancelled. The project is supported by a company that has substantial capitalisation and remains competitive despite the current property slowdown,” he continues.
Ashok J. Galgotia
The six-storey, low-rise building located in the Arjan Master Community, a one-of-a-kind community that promotes nature, greenery and
a family-first, amenity-rich lifestyle is still a hot property among those on the lookout for residences to move into. La Fontana offers a choice of 105 units comprising studios, onebedroom and two-bedroom apartments ranging from 352 square feet to 1,219 square feet, all surrounded by calming greenery and judicious use of light and space. And while property prices have tumbled down as much as 35 per cent since the start of 2009, Triveni is maintaining a status quo on its current offer, with prices ranging from Dh498,600 for studios to Dh1,315,900 for two-bedroom apartments. “There is no need to slash prices, because the best thing about La Fontana is
its value-for money location. Prospective buyers appreciate the value they will get in return for their investment,” continues Galgotia. Galgotia likewise confirmed that construction has been in full swing since May 2009, and assured investors that the project will be delivered just after Eid Holidays of 2010. The change in completion schedule was caused by a slight delay in the provision of permanent power and water supply from the master developer of the Dubailand community, Mizin. Triveni Builders is a subsidiary of Triveni Group, which has appointed Al Shafar National Contracting L.L.C. (ASNC) as the general main contractor for La Fontana.
etter Homes real estate agency has witnessed some positive results over the past few weeks, where both general enquiries and transactions are on the rise, after a dip in recent months in light of the effect the global financial crisis has had on the UAE. The company has engaged in a number of promotions and campaigns throughout the first half of 2009, where it has focused on offering carefully selected units to its clients, through various marketing methods and channels, within both the sales and leasing segments of its business. Following a summer promotional ‘Open Day’ event at its Jumeriah Beach Residence branch in line with the start of Dubai Summer Surprises, it recorded an overwhelm-
ing response to its summer offers of inventory for sale and for rent. “There were no signs of repressed customers during our Open Day weekend” said Jannie Biddulph, Sales Manager, Better Homes. “Our promotion received over 350 walkin customers, seeking both properties for sale and for rent.” Since then, the company has focused on promoting competitively-priced units in areas of demand and received over 1,400 calls in just two days during the selected promotions. “The positive result indicates that despite the recent market downturn, if the right product is offered to the client at the right price, at the right time, there is a good opportunity to transact units within both sales and leasing” said Ms Billy Rautenbach, Director of
Operations, Better Homes. With a specific customer and the right product in mind, it has been able to successfully match buyers and tenants with units, at a price which aims to satisfy its clients, creating positive results. “For example, our number of leasing transactions
is looking very positive”, added Ms Rautenbach. “In May this year, we executed 24 per cent more leasing transactions than in May 2008”. With general enquiries on the increase and talk in the market of mortgages becoming available soon, Better Homes expects to see continued success in leasing and see an increase in property purchases sooner than expected. “As soon as lending becomes available on a wider scale, we expect to see a rise in sales transactions”, added Ms Rautenbach. “It is difficult to forecast an exact trend, but if the UAE real estate market, specifically in Dubai, is bottoming out as many have suggested (and Better Homes has noticed an increase in prices in select areas), then now would be the definitive time to invest in property”.
DUBAI REAL TIMES
Witnessing a positive market reaction
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ieutenant General Dahi Khalfan Tamim, Chief of Dubai Police, has made an official visit to Dubai Industrial City (DIC) in which he was briefed about the various development and infrastructure projects located across the six zones of the industrial destination. Dubai’s top police officer and his delegation were welcomed by Rashed Al Ansari, Vice President of Dubai Industrial City, as well as heads of departments at the destination. The light and medium weight industrial zone currently features 2.8 million square feet of open storage yards, three million square feet of warehouses in addition to 64 showrooms and four office buildings. Dubai Industrial City is also witnessing the construction of 30 manufacturing facilities that are due to be operational by the end of 2010. The 560 million square feet project is a comprehensive one stopshop industrial and commercial destination featuring six industrial clusters including food and beverage, base metal, mineral products, chemicals, transport equipment and parts, as well as machinery and mechanical equipment. The Chief of Dubai Police was also provided with an overview of safety standards at DIC which will house more than 500 light and medium
industrial factories when the city is completed in 2010. The industrial destination is also expected to house around 350,000 people across its industrial and commercial zones. The delegation toured the main offices of DIC, the offices of Dubai Industrial Academy (DIA), and were also given a presentation on the growth and development of the city and its future plans. They were also introduced to the services of Taasees, the largest government service centre in the UAE through which businesses can access the services of ten government departments all under one roof. Lt General Dahi Khalfan said: “Dubai Industrial City is one of the strategic projects in the UAE that plays a key role in promoting local industry, supporting the national economy, and elevating services to international standards.” Praising DIC’s efforts to create an ideal environment for attracting industrial investments, he called for a proactive approach to facilitate investment in the sector in addition to re-examining any regulations that might impede this progress. He also noted the need for nurturing industrial leaders through programmes such as those currently being offered at DIA. Al Ansari said the visit underlined
the vital role the Dubai Industrial City plays in supporting the industrial sector across Dubai. “His visit reflects the increased cooperation between us through the exchange of expertise and sharing of knowledge on various issues of mutual interest such as safety and traffic management. These factors have assumed added significance with several factories commencing production and development work progressing across various parts of the city.” Property prices in Jumeirah Village have climbed by five to 30 per cent from their low levels in January this year, according to recent reports, signifying an early recovery for the Dubai property market, which has witnessed a nine-month period of decline. Driven by its commitment to offering high-value units within luxury community developments, Memon Investments is fast-tracking the construction of ‘Gardenia I & II’ - a project strategically located in Jumeirah Village which has been master developed by Nakheel, and is set to provide authentic Mediterranean-inspired residential, commercial and retail space. According to recent reports, the 811-hectare integrated master community has not been impacted to the same degree as the large number of residential properties in
various locations across Dubai, and thereby presents a more profitable investment option for property purchasers today. Consequently, an increasing number of investors are reportedly looking at Jumeirah Village for a more solid investment opportunity with a lower risk percentage. As one of the first to develop within the Jumeirah Village development, Memon Investments has reported increased demand and inquiries for its ‘Gardenia I & II’ project. “Our capacity to identify the best master developments to build our projects in, not only in terms of facilities and prestige but more importantly in their potential to provide excellent investment returns, is the foundation of our strength as a developer,” said Ahmed Shaikhani, Managing Director, Memon Investments. Located near the Cultural Centre and Central Park, Memon Investments’ five-storey residential development will incorporate studios, one and two-bedroom units; lavish townhouses and loft apartments, with retail units on the ground floor. Based on the vision of Dimensions Engineering Consultants (DEC), it was splendidly designed with stuccoed walls, tiled roofs, rustic arches, solid wrought iron balcony grills, carved doors, ornamental spiral columns, marble flooring with thematic and floral patterns. Two leading suppliers and contractors are also collaborating for the project, including the International Foundation Group (IFG), who is undertaking the Dh 2.4 million shoring and excavation contract; and Shanghai & Arabian Electromechanical LLC (SAE), who will install high-speed elevators within the towers.
FACILITIES & SERVICES
ooking after buildings after they have been built is big business nowadays, and looking to get bigger as laws are introduced to encourage centralisation of those who fix things. Strata practices are being adopted more and more by interested groups who are being taught the ‘do’s’ and ‘don’ts’ of hiring a plumber, gardener, electrician, mechanical engineer and other tradesmen and professionals who see to our homely and workplace needs. Wouldn’t it be nice to just call one company to organise all the others. Well, yes, actually, it would be nice. It happens elsewhere – Australia has an established strata system for looking after its buildings, projects and people – and it going to happen in Dubai. Imdaad, an integrated facilities management company under Dubai World, has announced plans to recruit more staff this year to match projected growth in its operations. The decision will raise its staff count by 25 per cent by the end of 2009 compared to the number of staff in 2008. Imdaad sees this as a strategic necessity designed to meet the increasing demand for its services across an expanding geographical footprint. Jamal Abdulla Lootah, Chief Executive Officer of Imdaad, said: “The decision to increase our manpower base is a forward-looking strategy. The company has set ambitious targets for expansion in the region and to cement our leading position in the facilities management sector. Augmenting our human resources will enable us to meet our contractual commitments and deliver services of the highest standards.” The recruitment plan is consistent with the steady expansion of Imdaad’s workforce over the past
two years in line with its increasing operations. The company’s current manpower base shows an increase by 26 per cent compared to the number of employees in 2007. Armed with several new high-profile FM contracts, Imdaad has already set it expansion plans rolling by adding to its service fleet, which presently has 129 vehicles, including tipper trucks, skip loaders, dump trucks, tipper trucks with cranes, double cabin pick-ups, sand sweeping machines, beach cleaners, buses, tankers and compactors. New compactors and other vehicles have been ordered to strengthen waste collection and disposal services. In line with Dubai’s commitment to sustainable development, Imdaad has stepped up efforts to deliver ‘green services’ to ensure environment protection, and implement all safety and health parameters at its various projects. The Beati environmental awareness initiative it launched in Dubai schools has generated a tremendous response from the student community. Imdaad provides integrated facil-
ity management solutions and consultancy from the conception to the completion of projects, as well as customised long-term FM solutions. The company’s client base includes major corporate and service establishments such as Nakheel, Jafza, DP World, UAE Region, Dubai Customs, Limitless and Tamweel. Among major projects on its portfolio are Palm Jumeirah, The Gardens, Atlantis, International City, Jebel Ali Port and Free Zone, Ibn Batuta Mall, Dubai Maritime City and Wasl-DREC. The increasing emphasis by the UAE Government in the UAE on green building regulations has boosted demand for facilities management (FM) services not only in buildings under construction but in existing buildings as well, noted Sungwon OBO, a member of Makateb Holding. Sungwon OBO pointed out that while it will primarily focus on providing facilities management services to buildings in various stages of construction that are committed to adopting new green building regulations, it is also expecting a heightened demand for its consultancy services from owners of existing buildings who wish to reap the benefits of a sustainable facility. Eric Raes, CEO of Sungwon OBO, said, “With the UAE Government’s growing focus on green buildings and sustainability, both developers, and in several cases, owners of existing buildings, are keen to improve day-to-day operations in energy consumption, water use, indoor environment, and waste management. Incorporating sustainable practices in existing facilities will result in significant financial benefits in the long run, and building owners will not be burdened by the costs involved in replacing existing building systems if the improvements are made one
step at a time. The company intends to complement government initiatives to promote sustainability by offering our expertise to developers in designing and constructing facilities that truly adhere to internationally accepted green building standards.” Raes highlighted that in the case of new buildings, the development of truly sustainable facilities must start at the drawing board to ensure that buildings are designed to match their intended purpose, which will ultimately help cut down maintenance costs, improve building efficiency and ensure sustainability. He noted that the success of this process to a large extent depends on the expertise of architects and building designers to effectively integrate green building concepts in the design. A green building is an outcome of a design which focuses on increasing the efficiency of resource use — energy, water, and materials — while reducing building impacts on human health and the environment during its lifecycle. This is achieved by efficiently using energy, water, and other resources; protecting occupants, health, improving employee productivity, and reducing waste, pollution and environmental degradation. Aside from a comprehensive range of FM services, which include mechanical and electrical maintenance, cleaning, security and energy management, Sungwon OBO also provides consultancy service during the design and construction of building developments to help improve the building’s lifecycle. The expanded line-up of services is part of its growth initiatives in the UAE’s FM market, where the company aims to grow between 15 to 20 per cent within the next three years.
DUBAI REAL TIMES
Facilities management in demand
FACILITIES & SERVICES
Energy reduction By Alice Tapfield
DUBAI REAL TIMES
nergy reduction has become a hot topic of global discussion recently for both environmental and financial reasons, since in addition to saving the planet, ‘going green’ can also help to save money. The subject is particularly relevant given the current financial climate, and especially so for the UAE, where energy consumption has quadrupled over the last two decades. According to a report issued last year by the World Energy Council, the rate of consumption is now estimated to be around 10 per cent annually, which is both environmentally and financially unsustainable. At present, the UAE’s energy (in this article meaning electricity) is generated mainly from natural gas, supplemented by oil where necessary. The country is at the forefront of global efforts to develop alternative energy sources such as solar power, but as renewable technology alone cannot yet satisfy high levels of demand for power, reducing consumption still remains crucial. The need for more prudent usage should not, however, cause alarm. Since energy is often used wastefully, cutting back should be achievable simply through improving energy efficiency, leading to potentially huge cost savings for consumers, businesses and the economy as a whole.
“We believe this will have a sustainable impact on our immediate surroundings and also motivate other stakeholders across the region to emulate our example”
Knowledge is power: How energy efficiency in buildings can save costs Although many power-saving measures are widely known today, a certain lack of awareness still generally exists about why and how to conserve resources. This has been rec-
ognised by the Dubai Government, which has begun a co-ordinated effort to educate the public in this matter. Both the Dubai Municipality and DEWA (Dubai Electricity and Water Authority), for example, are running numerous programmes aiming to demonstrate how energy efficiency helps to protect the environment as well as leading to substantial personal savings. “Through a series of initiatives towards safe-guarding the environment, such as the ‘Best Consumer’ and ‘Conservation for a Better Tomorrow’ campaigns, DEWA aims to encourage the community to adopt and endorse green concepts within their homes and offices,” explained Engineer Amal Koshak, Senior Manager of Demand and Tariff Management at DEWA. “We believe this will have a sustainable impact on our immediate surroundings and also motivate other stakeholders across the region to emulate our example.” Statistics show that the schemes are already making a substantial impact among the public. According to DEWA, electricity consumption decreased by six per cent and water use dropped by 37 per cent amongs all sectors which participated in the DEWA ‘Your Decision’. campaign in 2008. This suggests that consumers across all sectors are keen to embrace new methods for increasing energy efficiency. There is undeniably a strong case for sustainable living and reducing our carbon footprint from an ecological perspective, which is reason enough to cut back on consumption. However, the monetary advantages to energy saving are equally clear, and assuming (if cynically) that the majority of people
Dubai is positioning itself to be one of the world’s greenest cities and this collaboration between DEWA and the Dubai Municipality will result in the world’s first comprehensive system of green building regulations
Paying for what you use... cutting costs with consumption-based energy billing
are motivated more by potential financial gain than environmental concern, classic economics should dictate a decline in consumption. Yet energy continues to be squandered on a surprisingly large scale in Dubai, which suggests a blockage somewhere in the proverbial system.
Government initiatives to lead the way Dubai is serious about tackling environmental issues, and as part of its Strategic Plan 2015, it is committed to setting a global precedent in sustainable development. While the government has always been reluctant to impose legislation unnecessarily, the effects of the market’s ‘invisible hand’ are still not as apparent as one might expect in the current financial climate, where costcutting has become of paramount importance across all sectors. Realising, therefore, that regulation would speed up the drive to ‘go green’, in October 2007 a directive was wisely issued by His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, stipulating that all construction within the Emirate must henceforth comply with green building regulations. Following a thorough review of over 250 international rating systems, including US-based LEED, UK BREEAM and Australian Green Star, the Dubai Municipality and DEWA will shortly be issuing a new green code. This will cover all aspects of building design, construction and operation and will be mandatory, thereby surpassing all other (voluntary) international
building codes in the scope of their application. Kamal Azayem, Mechanical Engineering Expert at the Dubai Municipality, is the co-ordinator of the green building committee from the Municipality’s side. “The green building regulations we are developing will be instrumental in helping to save energy and water throughout the Emirate”, he commented. “Dubai is positioning itself to be one of the world’s greenest cities and this collaboration between DEWA and the Dubai Municipality will result in the world’s first comprehensive system of green building regulations.” The legislation, which will be implemented in four tiers and apply to both new and existing buildings, will undoubtedly accelerate adherence from developers in Dubai to energy-saving. Yet the question still remains as to why, given the potential cost benefits of conserving power, consumers have so far
One possible reason for the continuing disinclination to save energy is that prudent usage is not being fostered through current methods of billing. Currently, although all buildings in Dubai are metered, the choice still lies with developers as to how tenants are charged for electricity and water consumption. Consequently, many landlords have traditionally chosen to include utility payments within annual rent or service charges, be it for ease of implementation and/or financial gain. Usually, the total energy bill for a building is divided between individual units based on their floor area. The system therefore assumes that greater floor space equates to higher power consumption, which neither rewards tenants who use less power, nor penalises those who use more. This creates no incentive to save; residents must pay for energy even when it is not required, and this inherent unjustness has led to many recent complaints from tenants. Juergen Schmidhofer, is a flat owner in Discovery Gardens, where residents are charged Dh11 per square foot for cooling energy.
Landlords who are able to keep their costs down and consequently offer lower, and more equitable, service charges to tenants automatically become more attractive than their less energy-efficient competitors
“Regardless of actual usage, everyone here pays the same,” said Mr Schmidhofer. “This system is extremely wasteful and it would be much more efficient, and cheaper for all of us, if we were metered.” Studies carried out by the E.V.V.E. (European Association for the consumption-based billing of energy costs) have shown that energy and water consumption is typically around 20 per cent lower in sub-metered buildings. This points to a direct and positive correlation between tenants’ responsibility to pay for what they use and their prudent consumption of resources. As such, real estate developers stand to make substantial gains from installing advanced metering and billing systems in buildings, since the cost savings from lower energy consumption can be passed on to tenants in the form of lower service charges. The latter now represent an important factor for both residential and commercial tenants in choosing new premises, so the ability to reduce fees is significant for developers. A high proportion of service charges are frequently attributed to cooling energy, so landlords who are able to keep their costs down and consequently offer lower, and more equitable, service charges to tenants automatically become more attractive than their less energy-efficient competitors. With this in mind, metering and
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apparently been reluctant to cut back.
“One of the most important roles of the Facilities Manager is to improve the energy efficiency of buildings by making the most of their existing technology
DUBAI REAL TIMES
billing systems also constitute a powerful weapon in the armoury of FM companies. The latter will be directly answerable to Home Owners’ Associations as soon as Strata Law takes effect in Dubai, and therefore must be able to advise clients about the most energyefficient products and services on the market if they are to remain competitive and renew existing contracts. “One of the most important roles of the Facilities Manager is to improve the energy efficiency of buildings by making the most of their existing technology,” said Fergus Appleton, General Manager of Towers and New Business at Concordia Community Management. “Many buildings don’t currently have centralised, energy management technology in place so FM companies need to adopt an innovative approach and utilise their resources effectively to constantly improve efficiency.” Mr Appleton emphasised that the really successful FM companies will be those which address the specific needs of the end user. “Approximately 45 to 55 per cent of a building’s budget is currently taken up by utilities. Therefore, in addition to providing excellent overall FM service delivery, facilities managers must also focus on increasing the efficiency of buildings in order to minimise the environmental impact and overall cost. “Concordia has achieved some fantastic results from implementing practical energy management strategies (we reduced chilled
water consumption by over 40 per cent on one contract) at little extra cost,” he added. “The companies that pay attention to detail, monitor the information frequently and constantly tweak their solutions will lead the market.”
Looking to the future The most forward-thinking real estate developers realised a long time ago that energy-efficient buildings are potential future goldmines, and consequently incorporated sustainable designs at the outset. Others have now seen the (green) light and are busy retro-fitting. The forthcoming building regulations will soon oblige the rest of the industry to follow suit and will undoubtedly
assist in reducing energy consumption throughout the emirate. The carrot-and-stick approach is generally accepted as an effective method for change, even if the relative proportions remain in dispute. In the case of energy saving, the stick is regulation, with the carrot being the potential financial rewards from cutting consumption. Yet it seems that this particular carrot is currently dangling out of reach for many consumers. That is, a reason why energy saving is not widely taking place in Dubai, could
… landlords who are able to keep their costs down and offer lower, and more equitable, service charges to tenants automatically become more attractive than their less energyefficient competitors.
be that people are unable to reap the benefits it should bring in the form of lower bills. So far, no legislation exists in Dubai governing metering requirements. The Emirate is, however, fully aware of the need to preserve its precious energy resources; significant savings have been achieved in other parts of the world through introducing comprehensive regulations for metering and billing practices, and this presents a strong case for Dubai to do the same. As His Highness Sheikh Mohammed has stated “energy conservation represents one of the greatest challenges today towards sustainable development. Dubai has already set the wheels in motion through some excellent government initiatives, of which the forthcoming green building code will represent a global first in the scope and depth of its coverage. While the support of consumers for energy conservation is also growing, for both economic and ecological reasons, creating further financial incentives to save would accelerate the process and help to assure Dubai of its status as a future world leader in environmental practices.
Alice Tapfield is Senior Editor at Bridge Media News
A set of keys homes in November but has now completed the villas and customers were given a preview of the homes before the hand-over process started in June. Mr Ahmad Al Matrooshi, Managing Director – UAE, Emaar Properties, said: “Emaar achieved this milestone by working in close cooperation with contractors and consultants with a focus on optimising resource use efficiency and maximising productivity.” Emaar is progressing on the completion of its projects, which are in varying stages of development. The company has four established communities in Dubai already – Emirates Living, Arabian Ranches, Dubai Marina and Downtown Burj Dubai. Omniyat Properties has handed over the keys of Bayswater, its commercial tower in Business Bay, to investors. The scissor-shaped tower has 293 offices and 11 retail units. Omniyat Strata Management will control and manage the administrative and financial requirements of the building's common facilities and assets. Dubai-based Deyaar Development has begun handing over all 470 residential units at four of its residential projects at Dubai Silicon Oasis. The four projects comprise
the Coral, Jade, Ruby and Sapphire Residences. This follows the recent delivery of all 312 units at Madison Residency in the Technology, E-
Commerce and Media (TECOM) free zone, and brings the total number of projects delivered in the first six months of this year by Deyaar to
Dubai Silicon Oasis
“Emaar achieved this milestone by working in close cooperation with contractors and consultants with a focus on optimising resource use efficiency and maximising productivity.”
five, the company added. Joint-venture partners, Nakheel and IFA Hotels and Resorts have started handing over the keys to the residential units at Golden Mile on Palm Jumeirah. Golden Mile is made up of 10 buildings with a total of 860 residential units, in addition to the first freehold offices on Palm Jumeirah, as well as an extensive retail area. All residential units are managed by the neighbouring Fairmont Palm Jumeirah hotel, which is set to open in 2010.
DUBAI REAL TIMES
t a time when the word property lies hand-inhand with the word uncertainty it is a pleasant surprise to note that buildings are being built, owners are collecting their keys and the business of moving in and living a life are going on quietly in the background of everyday life. Zabeel Properties has officially handed over its first development to its owners at Tiara Residence, comprising of 644 resort style residences, located on the main trunk of Palm Jumeirah. About 70 per cent of the development has been sold and home owners began moving in during April. Emaar Properties has highlighted its commitment to project delivery, despite the challenges of the global financial crisis, with the hand over of Alma townhomes in Arabian Ranches five months ahead of schedule. The company had recently also completed and handed over La Avenida, a cluster of 17 luxury villas within Arabian Ranches, eight months ahead of schedule. Acommunity of 212 luxury homes, Alma townhomes had gained overwhelming investor response when launched in 2007. Emaar was to have delivered the
Cranes are moving
DUBAI REAL TIMES
any cranes in Dubai are actually moving as construction moves on at a less hectic pace. Cement is still being poured and interior designers are sharpening their pencils waiting to beautify these edifices. Cayan Investment and Development has announced that it iconic Infinity Tower development in Dubai Marina has accelerated its construction work and has already achieved significant progress on site. The 80-storey tower, which will offer a spiral view with a 90-degree curve design to give a stunning view of Dubai Marina, has reached floor 16 of the core wall and floor
seven for the typical floors. The podium levels, which make up six floors, are all complete. Arabtec, the main contractor for the project, has over 1,000 workers on site, working around the clock on shifts to ensure the construction schedule is followed. In his comments on the project construction, Mr. Ahmad Al Hatti, Chairman of Cayan, said: “Cayan Investment and Development has always remained committed to timeframes on its various projects and Infinity Tower is no exception. We have moved from basement to level seven in the past six months when recession has hit hard and where many developers have stopped or slowed down their work; Cayan, on
the other hand, has accelerated its construction work on site.” The development has already garnered a total of six design awards over the last three years, including the International Architecture Award from the Chicago Athenaeum. Cayan has already carved a niche with the hand over of La Residencia Del Mar, Dorrabay and The Jewels projects in Dubai Marina and Cayan Business Centre in Tecom. Arabtec Construction LLC is the main contractor for the project, while Drake & Scull has been awarded the MEP works. Khatib & Alami are local consultants for Infinity, Currie & Brown are the Project Management Company and SOM is
the main consultant. Memon Investments has announced that it is on track with the construction of all its projects in Dubai, which are collectively valued at Dh1.34 billion. The developer is asserting its commitment to delivery, despite the massive delays and cancellations of 48 real estate projects in the UAE. The report, which was released by REIDIN.com also revealed that the majority of the troubled projects are high-end residential and commercial developments, as the drop in sales and strict financing have forced developers to reconsider their project’s viability. Underlining its capacity to proceed with the construction of all its
Omniyat Asset Management (OAM) has signed a Memorandum of Understanding (MoU) with Dubai-based u concept, a premier health and fitness service provider, to offer unique lifestyle services to tenants of the Dh507 million One Business Bay, which will soon be delivered. Under the agreement, u concept will operate the entire podium roof consisting of approximately 21,500 square feet for recreational, beauty as well as food and beverage offerings
measures spearheaded by the UAE Government. Through the combined efforts of the government and the industry, I have high hopes that we will be able to weather the challenges brought by the current slump in the market,” concluded Shaikhani. Omniyat Asset Management (OAM) has signed a Memorandum of Understanding (MoU) with Dubai-based u concept, a premier health and fitness service provider, to offer unique lifestyle services to tenants of the Dh507 million One Business Bay, which will soon be delivered. Under the agreement, u concept will operate the entire podium roof consisting of approximately 21,500 square feet for recreational, beauty as well as food and beverage offerings. This area will form the cornerstone of the OYSTER, and Omniyat lifestyle initiative which stands for Offices Yielding Superior Targets through Efficiency
and Relaxation. The OYSTER is built on the belief that developing ground-breaking and interactive work facilities can contribute to revolutionary high work performance. The concept was originally introduced after the launch of One Business Bay, but Omniyat has allocated additional budget to integrate these services and principles into its current flagship. The company is dedicated to constantly enhance the personal well-being of people who live and work in Omniyat buildings. OAM, the Dubai Business Bay specialists, together with u concept will be the first to give life to this harmonious workplace focused on providing a healthier work/life balance for the first batch of office workers in Business Bay. u concept has made its name with a custom offering called ‘u plan’, working on the premise that each person has unique fitness
needs and is committed to tailored wellness plans. A customised health programme is devised to enable individuals to reach specific goals centred on stability, strength and power. Another offering is ‘u fuel’, which pertains to all nutritional aspects – advising and educating individuals on healthy eating habits that complement one-to-one training. Food is freshly prepared at the restaurants, fit for a gourmet and tailored to the specific dietary need of each person. The food services are available as part of the overall wellness plan, but also provide a healthy and considered alternative for business lunches. OAM and u concept will work closely on diversifying the OYSTER offering into new categories and avenues across the Omniyat Portfolio, making them a strong player in the healthy lifestyle business sector.
DUBAI REAL TIMES
launched projects given its strong financial standing, Memon Investments has pointed to the first development within its ‘Champions Tower’ series, and the ‘Cambridge Business Centre’ which is expected for delivery by the end of 2009. Having strictly adhered to the Escrow Law and registered with the Real Estate Regulatory Agency (RERA), the developer is expecting a boost in investor confidence as a result of its efforts to ensure security for their investments. “The global recession has created an astounding backlash to the regional real estate sector that has even the largest real estate players in the region reeling from its blows,” said Ahmed Shaikhani, Managing Director, Memon Investments. “We are proud to be still standing strong amidst the downward momentum that is sweeping the regional real estate market, and we believe that this has been the result of our unwavering commitment to meeting our clients’ needs, combined with our strong fundamentals and financial backing. We are confident that the current economic conditions will have little effect on the construction of our projects.” Memon Investments has launched a total of five projects in Dubai Sports City, including four towers within the ‘Champions Tower’ series and ‘Frankfurt Sports Tower I’, in addition to 'Gardenia I & II’ in Jumeirah Village, and 'Cambridge Business Centre' in Dubai Silicon Oasis. In line with the reported decline in the construction cost per square foot within the UAE since the onset of the economic crisis, the developer has committed to further strengthening its partnership with leading construction companies. “The challenges posed by the current economic crisis are true tests to the commitment of organisations to delivering their promises and to their resolve to overcome difficult situations. As an established player in the real estate realm, we have taken the necessary adjustments to combat the repercussions of the crisis, which we believe can be further countered with a continuous stream of positive
A defiant mood
The Big 5 PMV, now in its third year, will be staged at the Dubai International Convention and Exhibition Centre alongside the Big 5, from 23-26 November, 2009
Companies are defying the global slump by putting their minds to a variety of ways to continue working hard to deliver their goods. Work is continuing on building projects and keys to completed properties are being handed over to owners. Interior designers and office furniture suppliers reap rewards by updating and modernising businesses which have decided to rent and stay in their present locations. There is now time too, to sit, think and draw up feasible telecommunications infrastructure plans for both future and current buildings. Even old machinery is being given a new lease of life as auction companies sell off previously owned industrial equipment to overseas customers.
DUBAI REAL TIMES
he construction industry is showing signs of defiance with over 200 projects completed or to be completed this year, more than the total for the whole of 2008. Research by industry analysts Proleads has revealed that only 2.4 per cent of UAE construction projects worth $1.28 trillion, which were under way at the start of the year, have been cancelled. The figures were highlighted as development plans were released for the Big 5, one of the world’s largest trade shows for the construction industry, when it takes place for the 30th year in Dubai in November. A new purpose built temporary structure and outdoor exhibit area is being constructed at the Dubai World Trade Centre to accommodate the
Big 5 PMV, the specialised focal point of the exhibition for manufacturers and suppliers of construction plant, machinery, vehicles and equipment. Peter Sutton, Vice President – Venues at DWTC said: “Building on the success of the decision to relocate the Big 5 PMV to Dubai World Trade Centre last year, which led to a 29 per cent increase in visitors over 2007, Car Park C site is undergoing significant re-development. The entire site is being levelled and surfaced with a grid network laid throughout for electrics and drainage and the PMV indoor area will be a fully functional purpose built temporary structure.” Despite negative effects of the recession on the construction sector, companies like Al Nawi Group, UAE representatives of Finnish manufac-
turers Scanclimber, see a silver lining for the construction equipment business and the industry as a whole. “The construction industry is witnessing a slowdown at the moment, but I believe that if the right measures are taken by the governments, things will start picking up again by the end of the year,” said Aamer Hammoudi, General Manager, Al Nawi Group. Hammoudi said the economic crisis has led to the company focusing its resources on serving its existing top five customers who generate 80 per cent of sales in the Middle East. “We know that these customers have projects that will take us through the downturn. At the same time, we are streamlining our operations to cut all unnecessary overheads. We are carefully applying our resources into ar-
eas that are productive and generating business. Now is not the right time to expand.” While the UAE had a strong presence with 72 exhibitors, the international pull of the show and the lucrative nature of the Middle East construction sector were highlighted by the fact that 28 countries were represented including Italy, Germany, France, USA, Taiwan and China. Summertown Interiors has found that the economic downturn has a positive side for business. The design team has seen a trend in many corporations investing in new office fit-outs and refurbishments for their office space; using money saved as a result of the decrease in the rental market. “In this current economic
Summertown Interiors headquarters and showroom in Jebel Ali Free Zone
meeting with the engineering offices and construction companies, developers and government property firms in Dubai. The meeting, which comes within the framework of the municipality's commitment to the continued development to provide services for customers, was held at its training centre in June. It introduced the World Bank's concept of building licensing process and the necessary steps for the establishment of a comprehensive building, starting from the land map to getting an NOC, submitting plans, obtaining building permits, requirements of the work site, supervision, obtaining completion certificates and application procedures for final delivery of the services. Eng. Khalid Mohammed Saleh, Director of the Buildings Department pointed out that the purpose of this meeting was to reduce building permits procedures and to hear the complaints of owners of companies, consultants and contractors regarding the issuance of permits and approvals by the municipality. He noted that the municipality has carried out a study of the building permit process, to develop and improve the licensing and construction process within Dubai to raise the level of international competitiveness, and has an inventory of all the steps required (compulsory and optional)
of the construction of buildings in all stages, in addition to holding a number of workshops within and outside the Municipality with the clients. United Corrosion Technologies (UCT), a provider of corrosion engineering services and solutions has launched a new range of innovative products that safeguard against the financial and structural threat of corrosion of exposed steel rebar. The launch of the product range comes at a time when a large number of projects in the region are on ‘hold’ or progressing at reduced pace, leaving rebar exposed to the elements. Steel reinforcement corrodes rapidly when exposed for prolonged periods to the erosive environment of the Arabian Gulf region, making protection and preservation vital. UCT’s new range of products is available in many forms, allowing the prevention of flash rusting and providing protection of exposed rebar for up to five years. Without such treatment, the resultant accelerated rates of corrosion can compromise the future integrity of the structure, with potentially severe safety and cost implications. The company’s products have been utilised in many projects throughout the Middle East, including Burj Dubai, the world’s tallest structure. In-line with its commitment to
bringing top of the line telecommunication services to its customers, du has introduced new building infrastructure guidelines supporting FTTx technology. This will benefit all categories of property developments to include existing and new projects, in terms of providing state of the art, future proof telecommunications and multimedia services to their tenants. Existing and future property developments will benefit from the latest building infrastructure guidelines leading to increased flexibility in installing telecom infrastructure, reduced efforts and space, and less complexity in managing electrical installations. These guidelines cover different building types like residential villas, buildings, commercial towers, shopping malls and others. It is structured to cover all aspects of telecom infrastructure such as telecom spaces, electromechanical works, pathways and telecom cables specs. The complete guidelines are available for viewing and download on www.du-noc.ae The brochure guides property developers through a No Objection Certificate (NOC) process that includes design validation, materials checking and site inspections, through to final implementation.
DUBAI REAL TIMES
climate commercial rental properties have adjusted, at times falling by up to 40 per cent, and this has opened up avenues for new business for us. Some corporations have almost halved their rental costs and many have been directing this extra capital to new office fit-outs or office refurbishments or alternatively some decide to move premises as they get more value for their money in terms of location or square metres” said Marcos Bish, Managing Director, Summertown Interiors. A market leader in eco-friendly design, the company is compliant with the Leadership in Energy and Environmental Design (LEED) certification, in the gold category. In a time of economic crisis, the LEED certification is a further coup as businesses are realising that they can actually save money with their new or refurbished office, whilst simultaneously minimising the company’s corporate carbon footprint. “There has been a significant increase in the uptake of green initiatives in the UAE, as companies become more aware of cost-savings during the current economic climate. By incorporating environmental designs which are LEED compliant, we can create an office which uses up to 35 per cent less energy, 40-50 per cent less water and can divert over 90 per cent of its waste from the landfill. When you add all this up on a yearly basis, it can be a considerable saving for a company,” said Bish. The company recently opened its new corporate headquarters and showroom in Jafza (Jebel Ali Free Zone), Dubai. The new premises offer water efficient fixtures to reduce water consumption; usage of LEED certified furniture, products and materials with high recycle content and reduced energy consumption through sensor-controlled lights. The premises also incorporated into their design star-rated energy electrical equipment; indoor CO2 monitors; water usage reduction through sensor based systems and waste segregation for recycling purposes – all of which will save money for the company. Buildings Department of Dubai Municipality organised its fifth
agers and project team members”. In the UAE, local literacy rates of women currently match those of men, and there are now more women at university than men. Women are accountable for an increasing portion of the national workforce and occupy jobs ranging from teaching and healthcare, to engineering and banking. Many women have secured senior roles and work in varying positions within an organisation. The recognition of the value and skills of women in a modern Arabic and Islamic society has given rise to women making their presence felt in the workplace. For women, achieving the Certified Associate in Project Management (CAPM) qualification is much easier than it used to be, requiring 23 hours of project management training from a recognised PMI institution, followed by an exam. This globally recognised qualification can lead to greater earnings, career opportunities and advancement, and greater recognition from peers. The credential also increases project management skills and knowledge. Dubai witnessed the exciting unveiling of the luxurious CocaCola Light Very Important Apartment (V.I.A.) in June at Uptown MotorCity. In line with the recently launched Coca-Cola 2009 “Open Happiness” campaign, Coca-Cola Light introduces one lucky winner from the region to experience the
DUBAI REAL TIMES
TTX is a form of fibre optic communication delivery in which the optical signal reaches the end user’s living or office space. It can carry highspeed broadband services integrating voice, data and video on a single connection. Other acronyms such as FTTP, or FTTB are used, but these are essentially interchangeable. FTTH is becoming the catch-all description for all fibre to the home, premises, business and “x” technologies. From September this year, SMG (Specialised Management Group) will run courses for women by women. This initiative is in response to the growing interest in women working in projects and their desire to learn in a non-mixed environment. Courses will range from basic to advanced project management and will include preparation courses for certification as a project management professional. The courses will be tailored to suit the female project management professional and will be adapted to relate directly to the industries in which female attendees work. “The interactive nature of our courses means that all attendees will be able to get involved in activities while still adhering to cultural sensitivities,” said James Norbury, Executive Director of SMG. “Women are natural multi-taskers and the very nature of projects requires this skill. There is a need for more qualified women to work in projects as man-
You can win the Coca-Cola Light Very Important Apartment (V.I.A.) at UPTOWN MotorCity
glamorous side on the Coke Side of Life. Tune into MBC’s hit show Style & Stars to catch a glimpse of the most tastefully done, hip, exquisite and modern three-bedroom, fullyfurnished apartment and enter the regional SMS draw for the V.I.A. The company has taken a lifestyle route to highlight the modern well-being and contemporary living aspects of the brand through part-
Kuwait. The competition will run until August 9, 2009. Regional SMS codes will be broadcast every week on the Style & Stars show and are also available on www.cokelightvia. com The winner will be revealed on the final show airing on August 20, 2009. Regional auction companies have been reporting an upturn in sales despite, or perhaps because
RB Auctions in Jebel Ali held its busiest ever sale in June
nership with Union Properties (UP), one of the UAE’s leading property developers. In cooperation with the ongoing Dubai Summer Surprises (DSS), the campaign makes its debut during the region’s most famous, annually-awaited festival, bringing limitless opportunities with elements of fashion, glamour and style. MBC’s Style & Stars TV programme, airs every Thursday at 8pm UAE time during which Aline Watfa, Lebanese supermodel and popular host guides fans through the V.I.A. each week and welcomes celebrities, designers and personalities to the apartment. The contemporarychic V.I.A, decorated by popular interior designer Bara Zaher, will also become a home to one-of-a-kind celebrity signed souvenirs and mementos. Entrants must be 21 years or above and a resident of the UAE, KSA, Syria, Jordan, Qatar, Bahrain or
of, the economic slowdown. Earlier in the month, RB Auctions in Jebel Ali held its busiest ever sale at the location. Almost 700 people from 50 countries registered to bid in person or online at the unreserved auction of construction and other machinery. Around 2300 heavy equipment items and trucks were sold over three days, generating almost $46 million in gross auction proceeds, with around two-thirds of the items finding homes with overseas bidders. A lot of the equipment went to buyers from the Middle East, though there were bidders on-site at the auction from as far away as Singapore, India and Africa. “The auction went exceptionally well,” said regional manager Steve Barritt. “This was our first Dubai auction in which we sold more equipment to buyers from outside the United Arab Emirates than within.
egistered member companies of Dubai Multi Commodities Centre (DMCC) can now be part of the fastgrowing community at Jumeirah Lakes Towers (JLT), with direct and immediate access to all commodityrelated facilities being offered by the Centre. According to an announcement from DMCC, all member companies, including those awaiting membership approvals, will be brought together to form a physical commodities cluster within the 200-acre JLT free zone, facilitating optimum operational and administrative streamlining. This will also enable DMCC’s registered members to access a comprehensive commodities knowledge base comprising all stakeholders of the trade, and will facilitate the development of mutually beneficial synergistic relationships across the entire value chain of each commodity sector. According to the announcement, DMCC member companies, which until now have been operating from locations across Dubai, will now be required to relocate to the JLT free zone on completion of the first year of operations. The renewal of licences for existing members currently operating outside the free zone will be linked to their relocation to JLT. This move is part of a strategic initiative from DMCC to help its reg-
istered members make use of the exceptional advantages that Jumeirah Lakes Towers currently offers, including low property and rental rates. DMCCAuthority members can now choose from a variety of property options at any of the 79 towers within JLT, the first mixed-use free zone in Dubai offering freehold property options. Core commodities-related businesses operating within the JLT free zone are issued DMCC licences while others (noncommodity related) are issued JLT free zone licences. Ahmed Bin Sulayem, Executive Chairman of DMCC, said: “This initiative aims at long-term growth for the commodities industry via the creation of a dedicated cluster. DMCC has taken great care in designing the business facilities here, to offer our members the best in all areas. The move will facilitate higher integration of the commodities market, sharpen our members’ competitive edge and strengthen Dubai’s status as the most active trading hub in the region.” The move is also in response to the impressive rise in the number of registrations at DMCC and JLT, following the progress in the free zone’s development and the increasing interest from investors to set up offices. Despite the current climate of economic downturn, the first five
months of 2009 saw a total of 281 registrations being issued in JLT and DMCC. This included 85 DMCC core member company registrations, 142 registrations for JLT-based companies and 54 Residential Service Company (RSC) registrations. DMCCA is also working closely with the sub-developers of the Jumeirah Lake Towers project to ensure that the towers and office facilities are completed on schedule, which will help companies finalise their relocation strategy. Commenting on the new initiative, Sudhakar Tomar, Managing Director, HAKAN AGRO DMCC, a DMCCA member company, said: “We consider this a wise move. Operating from the JLT Zone as a community will streamline commodities trading activity in Dubai. The free zone advantages and the state-ofthe-art facilities are sure to provide a competitive edge to companies.” The JLT zone is Dubai’s most ambitious business-cum-residential community. Close proximity to the Emirate’s new developments and projects adds to its potential to support the sustainable growth of the commodities sector. DMCC offers its members several unique benefits including access to physical facilities like the Almas Gold and Diamond vaults, market infrastructure and trading platforms like
Almas Tower (Almas meaning ‘diamond’ in Arabic) is a landmark building, purpose built to cater to the specific needs of the Precious Gems industry.
the Dubai Gold and Commodities Exchange, Dubai Diamond Exchange, Dubai Pearl Exchange, Dubai Tea Trading Centre and Dubai Cotton Centre, plus a range of commodities backed financial investment tools including Shariah compliant hedge funds and Dubai Gold Securities, the region’s first Shariah-compliant gold security listed on NASDAQ Dubai .
DUBAI REAL TIMES
The Jumeirah Lakes Towers Zone
DMCCA sets Jumeirah Lakes Towers plan for members
Dr. Rashid Ahmed bin Fahad, Minister of Environment & Water; Eng. Hussain Nasser Lootah, Director General of Dubai Municipality; Mr. Kenji Saito, Japanese Consul General in Dubai; Mr. Essa Al Ghurair, Director, ETA Star Group and Mr. Syed M. Salahuddin, Managing Director, ETA Star Group and senior officials of the Municipality in front of the newly inaugurated medical waste treatment plant.
Region’s largest medical waste incinerator
DM and Zenath Group team up to set up world’s second-of-its-kind plant
he UAE’s first and largest vertical medical incinerator is also the world’s secondof-its-kind. The project was implemented by Dubai Municipality and Zenath Group, the recycling and waste management arm of ETA Star Group. Located at Dubai Municipality’s waste treatment complex at Jebel Ali, the Dh 24 million-incinerator has a total treatment capacity of 19.2 tonnes of medical waste per day on a 24 hour continuous run. Dr. Rashid Ahmed bin Fahad, Minister of Environment & Water inaugurated the medical waste treatment plant recently. Eng. Hussain Nasser Lootah, Director General of Dubai Municipality, Mr. Kenji Saito, Japanese Consul General in Dubai, Mr. Essa Al Ghurair, Director, ETA Star Group and Mr. Syed M. Salahuddin, Managing Director, ETA Star Group
and senior officials of the Municipality were present on the occasion. Mr. Lootah, said: “The new incinerator represents the use of intelligent technology. Its design allows for high energy efficiency and environment friendly emissions. There has never been a better time to introduce this treatment facility, given the steady increase in the number of healthcare facilities in Dubai,” he added. Lootah said that private companies as well as individuals can bring hazardous medical waste to this facility. Reinforcing the group’s commitment to environmental safety and public health, Mr. Salahuddin, said: “Emissions captured from the new medical waste incinerator with double bag filter have been put through extensive tests. Results revealed that
the quality of emissions were far better than expected - making it the second incinerator in the world that meets the highest control of emission norms and purity standards.” Mr. J.S.A. Bukhari, Executive Director, Zenath Group, pointed out that “The total medical waste generated in Dubai is approximately six tonnes per day, but is expected to double with the upcoming facilities in Healthcare City. The current spare capacity could therefore be utilised to treat hazardous, non hazardous industrial waste and municipal solid waste including sewage sludge.” The ETA Star group has tied up with Mitsubishi Corporation and Plantec Corporation of Japan to obtain the vertical incineration technology, known for effective treatment of infectious waste. The new incinerator will run for 330 days
in a year, with 30 days set aside for maintenance work and operational shutdown. Unlike other waste, treatment of medical waste has always been a very daunting task as it contains infectious microbes that vary in calorific value. Plantec Corporation has devised the technology for treating such material through the use of vertical incinerators. This technology was first incorporated in Japan and has been successfully used over the last 15 years.
DUBAI REAL TIMES
Omniyat’s fit-out partner
mniyat Property Services (OPS), a division of Omniyat Asset Management, have appointed Kinnarps Project Solutions (KPS), a leading commercial interior design and build company, to partner in the complete turnkey fit out of Omniyat’s three premier projects; One Business Bay, Bayswater and the Square - all set to be completed this year. Lloyd Budd, Commercial Director of Omniyat Asset Management, explained: “This is another milestone
towards providing our customers with a personal, seamless, end-toend property management solution. Through a single point of contact, Omniyat customers can now manage, design, fit-out and lease their property. With tenants now demanding a fit out solution before committing to a lease, I am pleased to announce that we appointed KPS to provide our clients with tailored, turnkey fit-out solutions.” KPS will create full packages unique to the client’s brief and
needs, and manage the complete process from original concept design through to final completion, providing practical design advice and adding value to the build-ability of the proposed solution. Chris Watson, Managing Director of KPS noted: “KPS’ array of fit-out solutions include; superior quality materials in base building works, partitions and custommade furniture, fully integrated IT & audio/visual solutions, security and phone systems.”
“Utilising the combined purchasing power of both KPS and Omniyat, we are able to offer landlords and tenants the best possible rates in the market regardless of unit size, and have tested this through a rigorous tender process involving six leading commercial fit out companies operating in Dubai,” adds Budd. Financing options for fit out are also available through Independent Finance, one of Omniyat’s partners.
he market for water and wastewater treatment equipment in Gulf Cooperation Council (GCC) countries experienced rapid growth during 2008 driven by huge investments in infrastructure, real estate, petrochemicals, oil and gas and other sectors. However, the sub-prime mortgage crisis that hit western economies changed the business climate and there was a considerable decline in demand for most commodities. Crude oil prices plummeted to about $50 per barrel from a historic high of $145 per barrel, making investors wary of funding new projects. Governments in GCC countries have exhibited strong political will to continue investing in important infrastructure projects. Environmental and health hazards related to the disposal of untreated effluents, marine pollution, and deteriorating ground water quality are some of the issues that are keeping market prospects alive. Though these forces have been overshadowed by short-term concerns, they are expected to positively impact market dynamics from 2009 to 2013. The extent to which markets across GCC member nations will be affected by the current economic slump largely depends on factors that include government dependence on oil revenues, dependence of economic growth on external debt, and ability to absorb the shock based on the inherent economic resilience. The core municipal sector is expected to cushion the impact of this slowdown. Governments in GCC
countries have identified municipal wastewater treatment as the priority area for multiple reasons including the achievement of the Millennium Development Goals. Some large private real estate developers of lifestyle townships, luxury villas, and shoreline apartments are utilising advanced wastewater treatment technologies to assist in maintaining a hygienic and odourfree environment. Wastewater treatment and reuse is likely to see widespread adoption across GCC countries, representing an expanding market for advanced technologies. On the other hand, desalination has been the prime driver for the water segment. â€œThe market is fraught with challenges in spite of its immense opportunities," says Frost & Sullivan Sr. Research Analyst Vivek Gautam. "The complex business environment, slow decision making process, and customer preference for low cost solutions regardless of the performance makes it difficult to penetrate the market." Further, the mass market is highly price sensitive, triggering intense competition in lower technology products. Profit margins for such products are also under pressure. Owing to the lack of technical competence, cost considerations dictate buyers' decisions. Component suppliers, in particular, are facing hyper competition due to the availability of low-costproducts from supplier nations such as India and China. The onus is on technology providers to roll out cost-effective products to
successfully navigate tough market conditions. District cooling is fast emerging as the most viable cooling solution in the Middle East, where the temperature frequently exceeds 45 degree Celsius and air conditioning requirements consume 70 per cent of the power during peak electricity demand. As power shortage is rampant in this region, governments are turning to district cooling to cool buildings, as it is a cheaper and greener alternative to air conditioning. This solution can not only mitigate the power crisis in the Gulf Cooperation Council (GCC) countries but also help reduce carbon footprints through increased energy efficiency and lower CO2 emissions. New analysis from Frost & Sullivan (http://www.buildingtechnologies. frost.com), finds that the market earned revenues of $580.0 million in 2008 and estimates this to reach $2.00 billion in 2013 at a compound annual growth rate of 28 per cent. With greater involvement of the government, the market is expected to become more organised, populated and competitive. Multinational companies will be attracted to this market due to the prospects presented by the investorfriendly laws, improved standards of living and high disposable income, which has set off a retail boom in the region. With the GCC becoming home to the biggest shopping malls in the world, there is a distinct need for district cooling in not only the residential sector, but also the commercial sector. The United
Arab Emirates alone is expecting to have 80 million square feet of office space by 2010, widening the scope for district cooling companies. District cooling production requires copious water, which, like electricity, is limited and therefore, expensive in the GCC. Currently, district cooling plants use potable water, but the search is on for a technology that will allow them to use non-desalinated seawater. Even though a few plants are already using seawater, the corrosion-resistant equipment needed will increase their equipment cost. The current credit crunch will make it even more challenging for companies to acquire the systems required to deal with this issue. As district cooling is a highly capitalintensive market, huge investments are required to meet the additional capacity required. "Market participants can blunt the effect of the reduced capital by concentrating more on small projects that require less time in commissioning and that can guarantee quick returns," remarks Darwin Kishore Selvaraj Selvaraj, Frost & Sullivan Research Analyst. "When big projects are split into smaller units, the limited capital will be sufficient to start the project." Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 35 offices on six continents. For more details visit http://www. frost.com
DUBAI REAL TIMES
Economic slowdown temporarily restrains commodities growth
The meaning of Corporate Social Responsibility
DUBAI REAL TIMES
ictory Heights, the luxury golfing residential development in Dubai Sports City, held a special community tree planting initiative to celebrate World Environment Day and Children’s Day which saw young participants plant trees and plants in different parts of the development, highlighting the importance of responsibly maintaining the environment. The children also enjoyed a number of games and competitions in Estella Park set in Victory Heights. Victory Heights has fast become popular for the way its luxury villas are taking shape among the beautiful landscape, walkways and the world-class designed golf course. Luxury villas and townhouses here come in a choice of classical European, Spanish Andalusian, and Mediterranean architectural styles, with custom finishes and a variety of options. Offering peace of mind, Victory Heights has appointed Bureau Veritas, a highly respected international firm, to provide a quality accreditation monitoring service from design to delivery. The record-breaking industrial machinery auction conducted by Ritchie Bros. Auctioneers in Dubai recently had an unusual beneficiary: Foresight, a Dubai-based organisation that raises funds to help find a cure for blindness caused by hereditary eye disease and also helps improve the lives of people with visual impairment. Southwest Middle East LLC donated the full proceeds from the sale of an unused Cat skid steer loader at the auction to Foresight. An on-site bidder from the
UAE purchased the skid steer loader for US$30,000. "I'm genuinely lost for words; this has been beyond what we would normally expect," said Sally Prosser, PR Manager at Foresight. "From the moment we heard the good news right through until the excitement of the auction, this was a unique and wonderful experience. We try to fund one research project per year and this will certainly allow us to achieve this year's objective. In addition, financial resources are always required to assist with our ongoing work in the community, assisting those who have lost their sight. Mobility training would be a prime example of this." In addition to the charity skid steer loader, the company sold al-
Mohammed Binbrek, Group CEO, Dubai Properties Group
most 2,300 heavy equipment items and trucks for more than 220 sellers, generating almost $46 million in gross auction proceeds. There are 73 unreserved Ritchie Bros. auctions on the calendar at http://www.
rbauction.com, including the next one at its Dubai site on August 10 to 12, 2009. Dubai Properties Group (DPG) has announced the release of its inaugural Corporate Responsibility Report, the first by a real estate company in the Middle East to be endorsed by the Amsterdam-based Global Reporting Initiative (GRI). It considers it not only a matter of philanthropy, but an ethical obligation to reduce the negative impact the company's operations might potentially have on the environment and increase the positive influence on the market, communities and people. Under the Society segment, nearly 150 Dubai Properties Group employees volunteered to donate blood while the group itself spent over Dh7million in employee medical insurance during the year. Under Environment, employees recycled over 28 tonnes of office waste, while DPG deployed environmental friendly substances (such as Inergen) for fire extinguishing sys-
tems, and utilised Green Building programmes in three major sites, one of which will comprise 73 per cent green space. Under the Marketplace category, DPG established 'Accountability' as one of its Brand Values, trained over 22 per cent of its employees on brokerage laws and conducted 36 inspections and audits to suppliers. In the People segment, DPG achieved zero fatal accidents for employees, conducted an appraisal process for 100 per cent of its staff, trained over 834 of them and received 495 suggestions from employees, of which nearly 10 per cent dealt with CR issues. DLA Piper's commitment to sustainability in the region was recognised at an award ceremony, where the leading international legal practice was given the Sustainable Initiative Award for its efforts to reduce its carbon footprint across each of its offices in the Middle East. The company has a global commitment to sustainability across all its offices which includes programmes designed to reduce business travel and offset emissions, purchase items manufactured from sustainable sources; and recycle plastic, paper, glass and cartridges. In addition, DLA Piper is the first international legal practice to achieve certification in the globally recognised environmental standard ISO 14001 across all its offices worldwide. The Sustainable Initiative Award win follows a week-long internal campaign – EnergySMART – to reduce energy output in all regional offices at DLA Piper. The campaign concluded in early May.
Dubai partner named in Who’s Who coveted legal list
LA Piper is the number one firm worldwide for real estate legal expertise, according to the sixth edition of The International Who’s Who of Real Estate Lawyers, published in June 2009. It was the most highly nominated firm in the research for the publication with more nominations from clients and peers than any other worldwide. Twenty-two practitioners are featured from 13 of the firm’s offices across the globe including the UAE, a figure unrivalled by any other firm. DLA Piper is the current holder of Who’s Who Legal’s Real Estate Law Firm of the Year, having won the award every year since its inception in 2006.
Tom O’Grady, is a partner at DLA Piper. He is regularly asked by the media to comment on issues arising from changes in legislation in the real estate sector. He has made speeches at the Hawksmere Conference on ‘Large Scale Mixed Use Regeneration Schemes’ and has articles published on mixed use developments and establishing unit trusts. His professional qualification is: Solicitor of the Supreme Court of England and Wales. Tom O’Grady
The book is a result of six months of independent research incorporating feedback from lawyers and in-house counsel, and covers 470 lawyers in 39 separate jurisdictions. Editor-in-chief Callum Campbell said, “It is impossible to buy entry into this publication, only those lawyers who receive sufficient nominations from their peers are included. This book represents a truly global, highly qualitative survey of only the best real estate lawyers, based on exhaustive
Research for each practice area publication is conducted through conversations with private practice lawyers of repute in the practice area in question and in related fields, as well as with general counsel Subsequent telephone and face-to-face interviews are conducted internationally to permit the refining of the listing to a selection of between 100 and 600 lawyers who, by general agreement, are considered the pre-eminent lawyers in the field It is impossible to buy entry into this publication, only lawyers who have met independent international research criteria are listed The International Who’s Who of Real Estate Lawyers 2009 acts as a reference source for purchasers of legal services seeking to corroborate the reputations of expert lawyers recommended to them by another party Who’s Who Legal aims to reduce the short-term costs incurred in finding a lawyer, but more significantly, to minimise the transactional expense and risk of receiving poor counsel
research. The unparalleled levels of positive feedback we received for DLA Piper from numerous countries worldwide testifies to its continued excellence confirms it as the leading firm in this field.” In 2008, Who’s Who Legal was named the Strategic Research Partner of the American Bar Association Section of International Law, in addition to its position as Official Research Partner of the International Bar Association. In 2006, Who’s Who Legal’s parent company Law Business Research was recognised by The Queen’s Award for Enterprise in the area of international trade. These awards are the most prestigious a British company can receive.
nternational law firm Pinsent Masons has been named Global Construction Law Firm of the Year 2009 in the Who’s Who Legal Awards. This is the third time the firm has been recognised in this way, having also won the award in 2008 and 2006. Twelve of the firm's partners are commended in the publication, spread over five different jurisdictions, including the UAE
and China. One of those given particular commendation was Michelle Nelson, a partner of Pinsent Masons’ Dubai office. Nelson has substantial international experience and has advised on a variety of projects relating to roads, hotels, airports, process and power plants, commercial and residential premises. She has particular expertise in international
arbitration, especially in the Middle East. The company’s construction group is renowned worldwide for high profile work, particularly across the GCC. The UAE team is ranked number one for construction law in Legal 500. Pinsent Masons has had an established presence in the Gulf since 2004 and offers construction, projects, real estate, corporate,
outsourcing and technology law services. With over 30 qualified legal staff including 20 construction specialists, it has the largest single group of construction lawyers in the Gulf. From its offices in Dubai, Pinsent Masons has well established links with local law firms in neighbouring countries including Bahrain, Jordan, Kuwait, Qatar, Syria, Yemen and Saudi Arabia.
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Special commendation by legal awards for UAE work
Global architecture award
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Pic 1 – Pic 2 –
ubai Municipality won the World Architecture Award at its fourth cycle of 2009 in recognition for the restoration project on the House of Scholar Mohammad Sharif in the Bastakiya. The Municipality won the award in the category of the Best Project that won the appreciation of the Honorary Committee. Eng. Rashad Bukhash, Director of Architectural Heritage Department said, "This was one of the best examples of the few remaining houses in Bastakiya and surrounding areas with rich traditional architecture and engineering, which has become one of the most important symbols of local architecture in the UAE. The Architectural Heritage Department had restored the house in 1997 to make the building its office. It is considered one of the main groups of architectural buildings in the world with electronic data for the reference of architects from all countries of the world. The main task was to give op-
“This was one of the best examples of the few remaining houses in Bastakiya and surrounding areas with rich traditional architecture and engineering, which has become one of the most important symbols of local architecture in the UAE” portunity for promotion of local practices recognised internationally and to provide a directory of contemporary architectural practices in all countries, as well as the opportunity to get acquainted with the latest theories in architecture.
he proof of the pudding is in the eating (old English saying) and Nakheel has certainly proved that it has a warm heart by quietly saving 5,500 tonnes of coral having devising plans to successfully move it from one location to another. And the plan has worked – as proved when one year after 1,129 five-tonne coral-covered rocks were relocated from Dubai Dry Docks (DDD) to The World, with 93 per cent undamaged, the coral eco system is now seen to be thriving in its new location. Academics and marine life experts had a hand in advising the master developer on relocation methods. With a method which had never before been tried anywhere in the world before, and over a period of seven weeks between April and June 2008, rocks were relocated from Dubai Dry Docks to The World breakwaters, opening up a large area of DDD to allow for future development while also maintaining the largest coral reef ever found in these waters. The rocks, which cover an area of 6,560 m2 (about the size of a football pitch) were, and now continue to be, home to 18 species of coral and more than 30 species of fish plus various sponges, sea-squirts and urchins. The successful translocation will provide a boost to The World’s potential as a tourist destination by opening up a new area of the Gulf to scuba diving and snorkelling. A decision was taken to move the coral based on potential environmental impacts of proposed
construction activities in the area surrounding Dubai Dry Docks. To minimise the damage from traditional removal methods – which typically include the use of crowbars, underwater drills and cranes – a new technique was developed by the environmental team at Nakheel. A bolt was drilled into each rock and attached to a sling used to hoist the rocks to a depth of three metres below the water surface for attachment to a transport barge. The corals remained suspended in the water throughout the relocation process, minimising stress and damage. The coral translocation area has attracted a number of species of reef fishes that are less common elsewhere in that area, including a number of commercially important species. In addition, as many of the
transplanted corals are ‘broadcast spawners’, it is likely that they will seed the surrounding breakwater through their reproductive activities, resulting in the development of coral communities on nearby rocky structures. Coral is a vital facet of Dubai’s ecosystem. It is an important link in the food chain and is necessary to maintain levels of biodiversity. Nakheel also revealed that development of The World islands will be supported by an existing port in the Mina Rashid area, after dropping plans to build a port inside Dubai Dry Docks. Dubai Municipality- Dubai Central Lab Department has recently organized a scientific symposium on using mortar in green buildings. According to Eng. Hawa Abdullah Bastaki, Director of Dubai Labora-
tory Department, some significant tests on green materials and materials from recycling old concrete were exhibited in the symposium. These materials were intentionally manufactured to mitigate power consumption, protect natural materials, reduce the operational costs, strengthen the building performance and create a healthy environment for work and residence. “A quality mark system will be applied on the green building products” she pointed out. The advanced technical facilities in the lab will qualify it to perform as the first lab for green materials in the civic body and Dubai city. The laboratory will also conduct tests on site in addition to a lot of other tests such as physical, mechanical and thermal tests.
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The coral remained suspended in the water throughout the relocation process, minimising stress and damage
DUBAI REAL TIMES
Waste summit M
ay saw a bevy of professionals in the waste management and recycling industry meeting to discuss waste disposal and how it is affected by the current global economical challenges. Eng. Hussain Nasser Lootah, Director General of Dubai Municipality opened the Middle East Waste Summit 2009 which discussed various issues related to waste disposal methods, sound management and recycling. In his opening speech Lootah said that the world today is experiencing a range of environmental issues that have a direct impact on human life. A high proportion of waste generated in developing countries has helped global warming-an increase in levels of air pollution and pollution of the ocean. He pointed out that Dubai, which has seen an acceleration of urban growth in recent years, has a process of sustainable management of waste issues. During the year 2000 approximately 3,000 tone per day of waste arrived at the municipal garbage dump, in 2008, this had reached 11,000 tone per day and the annual
rate of increase exceeds 20 per cent per annum; during the same period the amount of construction waste generated in the emirate had increased to approximately 30 per cent. Dubai Municipality found sustainable solutions through strategic partnerships with the private sector, the implementation of several initiatives and projects such as recycling construction waste, household waste, tyres and a plan to recycle used oil. “Dubai Municipality has started work on three important projects i.e. a general strategy framework to reduce waste, an automated system for the collection of compressed waste, and waste from the transfer of energy in the emirate. This ambitious project will contribute to the Municipality’s proposal to turn waste into energy to achieve several objectives, including the reduction of emission levels of methane gas from landfills, reduce reliance on landfills and the health of the traditional method of disposal of household waste” concluded Eng. Lootah.
In an exclusive interview for the Middle East Waste Summit 2009, Andrew Quinn, Senior Waste Consultant, GHD talks about Zero Waste Inaccuracies and Realities.
MEWS: What initiatives for sustainable waste management that have been implemented in Australia would you recommend to the Middle East? AQ: The pace of development has been very fast in the Middle East and it has perhaps been easy to overlook details like sustainable waste management in the rush to get the next project started. Middle East governments, however, should not let the opportunity pass to establish sustainable waste management initiatives early on, whether it is in the development of new buildings, communities or cities. A little time and effort taken now will pay off in the long run. How some Australian cities have coped with the challenge of being situated in dry desert environments can be an example to the Middle East. Perth, a city of 1.5 million people on the south-west coast of Australia, is surrounded by desert. The sandy soil and the use of groundwater for domestic purposes make land filling an unsuitable method of putrescible waste disposal. Instead, local government groups in Perth have commissioned and are commissioning alternative waste technology facilities which process municipal and other
waste to produce compost and sometimes energy from gas. A facility of this type is under construction in Qatar. I see this kind of approach as having a much wider application in the Middle East. MEWS: Are ‘zero waste’ strategies viable in the Middle East with the current status of technology available in the region? AQ: Attempting to achieve a zero waste target is an admirable aim but in reality there is no one system that produces absolutely no waste. The best waste processing facilities still produce some residual product even if it is only small amounts of inert material. In my opinion, the best way
for countries in the Middle East to achieve maximum recovery will be through a combination of traditional and technological solutions. By traditional, I mean the source separation of easily identifiable materials such as cardboard, plastics and possibly food for separate processing and recycling. These activities have already been going on for some time. By technological solutions, I mean using modern processing infrastructure, equipment and available expertise to recover more difficult to separate materials.
lenges facing clean production in the Middle East? AQ: Sustainable waste management and cleaner production are intimately linked. I see the biggest challenge as raising the priority of both in the eyes of government, the community and business. Both obviously benefit the environment, but they also provide for healthier and safer places for people to live. Cleaner production also often means more efficient production creating the potential to save money.
MEWS: What are the biggest chal-
MEWS: How does the market in
the Middle East compare internationally for investing in waste management? AQ: In my opinion, the Middle East is ripe for investment in waste management. Waste generation is a function of population and development and the United Arab Emirates (UAE) has led the way in these areas in the last decade or so. We are seeing signs of a maturing in the UAE waste industry. For example, Thiess Services’ construction of a building and demolition waste facility in the UAE is a clear shift towards tackling more specific
waste issues. MEWS: What is the most important point you made at the MEWS 09? AQ: Governments, developers and the community should not ignore waste management and expect that waste will take care of itself. Careful, insightful and forwardlooking regulation and assistance is required to provide an environment in which the commercial sector and their customers, governments and the community can achieve their goals while effectively and sustainably managing their waste.
Industrial and hazardous waste management Middle East Waste Summit 2009 talked exclusively to Daniel M. Cheng, Managing Director, Dunwell Enviro-Tech (Holdings) Ltd about Industrial & Hazardous Waste Management.
MEWS: What are the best technologies for waste oil recycling? What processes are currently being implemented in the Middle East and are they adequate? DMC: We have to define ‘the best’. There are many different options of technologies ranging from the mega scale investment hydro-finishing, to the cheapest but very polluting acid clay treatment process used in the industry. Before selecting any of the process, we have to understand local government environmental stan-
dards, availability of local technical expertise, the market expectation on recycled oil products, market sizes, number of recyclers, etc. In the Middle East, the acid clay process has been adopted for years. Due to the highly polluted nature of the process, most of the governments around the world have restricted this application after they have found the acid sludge severely polluted underground water and soil. This is going to be an outgoing technology. Some recyclers are using simple dewatering and centrifuge techniques to produce fuel oil, which is of low value to the Middle East market that has abundant supply of fuel products. Some recyclers may be using high temperature distillation process, but this process is too energy consuming and requires extensive engineering support. The Middle East market is steering towards the directions of adopting a clean (non polluting) technology that can recycle used oil into finish lube products, with a low energy level and reasonable level of engineering requirement. Our VMAT fits into this context with a fast payback (less than two years) scenario. MEWS: When does Dunwell Enviro-Tech work with the oil and gas
industry? DMC: Dunwell has been involved in the oil recycling business since 1993, when we acquired and turned around a bankrupted Australian oil re-refinery operation (with a loss of US$ 10 million) in Hong Kong. For the last 16 years, we have been building our engineering capability and investing in R&D for coming up with a better process for the used oil recycling industry. We also work with oil fields in China to provide advanced technology for process improvement and water treatment. MEWS: How can Dunwell EnviroTech positively impact the industrial and hazardous waste concerns of all stakeholders including citizens, industry and governments? How can the company help reduce pollution in the UAE? DMC: Most governments nowadays are seeking ways to minimise the impact of oil related pollution in the areas of air, water, soil and CO2 emission. VMAT is recycling used oil into reusable green lube products instead of heavy fuel which will emit much CO2 and contribute to the global warming. The low temperature (85C) process does not crack the hydro-carbon structure of used oil and would not cause air pollution problems. The ab-
sence of chemical (acids) used would not cause further damage to the water and soil. VMAT is a modular expandable process to allow users to start with a smaller volume (5000 m3/year) and expand to 20,000 m3/year when they are familiar with the new business models and technology. Users can even setup the VMAT systems in various locations across the country, to minimise the transportation and enhance flexible operation. MEWS: How does the market in the Middle East compare internationally for investing in waste oil recycling? DMC: Since VMAT received the IChemE Grand Environment Award from London in 2006, we have been approached by almost 100 Middle East companies and even government appointed consultants regarding the feasibility of this project. Now with a total of four international awards received by VMAT, and actual installations around different continents, even more oil recyclers have seriously visited our industrial operations and are negotiating potential partnership for setting up VMAT in GCC countries. GCC is a big market and we are open to work with industry players and welcome referral agents to help us expand in this promising oil recycling venture.
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MEWS: What are your main projects internationally? DMC: We have been proactively seeking partners around the world to establish a low temperature (85 deg C), low pressure (50 psi) used lubricant recycling operation using our proprietary advanced vibrating membrane technology – VMAT. We have already set up this oil recycling venture in five cities and more will be installed in four countries in the next 9 to 12 months. VMAT recycles used lubricants such as engine oil, hydraulic oil, gear oil, etc. into green lubricants again. Unlike other processes that recycle used lubricants into fuel oil, or create a lot of secondary pollution (acid sludge), VMAT has become a popular option being enquired from international recyclers and even governments.
List of approved developers 220
A S A Developers Ltd
Almasah Middle East Investment Limited
Alosaimi Real Estate Investments Co L.L.C
A.S.A Developers Limited
Alshafar Development (L.L.C)
Aa Global Limited
Altajir Real Estate L.L.C
Aaa Auctions Organizing & Management
Amesco Tower Jlt
Aakar Developers Ltd
Anil Adinath Bastawade
Ab Properties Limited
Anis Holdings Limited
Abdulrazzq Ali Almadani
Anis Property Investments Ltd
Abdulsalam Mohd Alrafi Real Estate Development Group (L.L.C)
Antonia Resources Ltd
Abwab Real Estate Limited Co Llc
Arabia Group Development Limited
Abyaar Real Estate Development
Arabia Group Investment Limited
Aci Real Estate Llc
Arabian Investments Limited
Acw Holding Ltd
Aristocrat Star Investment L.L.C
Adel Mohammad Saleh Ali Naqi Al Zarooni
Ag - Optimo Limited
Arthur Fitz William (Plantation)
Aryene Plus Property Developers Limited
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Ahmad Abdulla Ahmad & Ayesha Ahmad Abdulla & Amir Badkoubeh & Armin Niasar
Ahmed Abdul Rahim Alattar Properties
Aryene Property Developers Limited
Al Duaa Holdings Fzc
Asadollah Hosseinali Kikha
Al Jawi Investment L.L.C
Ashai Tower Jvs Limited
Al Manal Development Fzco
Aswan Developers Inc
Al Mazaya Holding Company
Aswan Investments Limited
Al Murjan Real Estate ( Fzc )
Al Rashid Investments
Avanti Holding Limited
Al Sayyah & Sons Investments(L.L.C)
Avetona Global Ltd
Al Shafar General Contracting Co Llc
Avon Developers&investments Limited
Al Tafany Properties Limited
Axon Development (Fzc)
Al Tamimi Investments Limited
Azizi Invesments (L.L.C)
Al Zahra Properties
B & M Fzco
Albenaa Real Estate Investment-pjsc
Baiti Properties Development Llc
Alduaa Residence Limited
Bando Engineering & Construction Co Ltd
Alfajer Properties L L C
Bangash Builders &developers Limited
Bangash Developments Limited
Alfattan Properties (L.L.C)
Bangash Investments Limited
Alghanem Real Estate Llc
Baraq Holdings Limited
Almadar Investment (L.L.C)
Bassam Said Freiha
Bavaria Gulf Sandoval Ltd
Damac Properties Co.(L L C)
Bay Central Developments Limited
Dana Property Development (L.L.C)
Bay View Investments Limited
Das Real Estate
Beliza Resources Limited
Define Properties L Lc-fzc
Bella Vida Limited
Define Properties Plot 8 Limited
Beney Investments Limited
Desert Dream Investments Llc
Blue Sky And Nawaab Holdings Limited
Desert Home Fzco
Bonnington Land Limited
Dheeraj & East Coast L L C
Bonyan Emirates Properties
Diamond Developers Co.Limited
Bonyan International Investment Group L.L.C
Diamond Arch Limited
Bosphorus Investments Limited
Diamond Properties Limited
Brighton Holdings Limited
District Investment & Development (L.L.C)
Dja414 Investment Limited
Bucephalus Holding Limited
Dmcc Business Park Dmcc
Bukhatir International Realty Development & Investment Llc
Dream Estate Limited
Burj Alalam Holdings Limited
Dsec Corporation F.Z.C -rak
Burj Aldua'a Limited
Dubai Multi Commodities Center
Bux Holdings Limited
Dubai Guernsey Property Investment Limited
Byblos Real Estate Broker
Dubai Industrial City
Capital Trust Gulf Limited
Dubai Investment Park Llc
Cayan Real Estate Investment & Development (L.L.C)
Dubai Investment Real Estate
Cenita Global Ltd
Dubai Land ( L.L.C )
Chapal World Llc
Dubai Life Style City L.L.C
Chess Tower Limited
Dubai Maritime City
City-d Investments Limited
Dubai Properties ( L.L.C )
Cl International Development Limited
Dubai Property Ring Ltd
Cliff Dwellings Enterprises Ltd
Dubai Silicon Oasis Authority
Comfort Homes Ltd
Dubai Sports City ( L.L.C )
Condor Properties Limited
Dubai World Trade Center (L.L.C)
Cornica Tradings Assets Limited
Dujon Properties Ltd
Credo Investments Fze
Dunes Property Investments Ltd
Credo Investments Fze
Dunes Village Real Estate
Crown Holding Limited
Durar Al Emarat Properties Llc
Crown One Holding Ltd
Earth Developers (L.L.C)
Crown Three Holding Ltd
Edmonton Admire Properties Limited
Crown Two Holding Limited
Elan Investment Limited
D10 Awf Investment Limited
Emaar Properties Pjsc
Damac Development L L C
Emirates Sunland D1 Limited
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Emirates Sunland Pv Dubai Limited
Gulf Developers Fzc
Es Investments Limited
Gulf General Investments Co. (P.S.C)
Esca Properties Llc
Gulf Investments (Fzc)
Escan Real Estate Pjs
Gulf Line International Ltd
Essa Bin Nasser Bin Abdullatif Al Serkal
Gulf Shores Inc
Eta Star Property Developers (L.L.C)
Gulf Technical Construction Co (L.L.C)
Ever Green Signature Investment Limited
Gulf Towers Investment Llc
Ever Shine Dubai (Bvi)
Halcon Real Estates Development (L.L.C)
Fabson Import Export Limited
Hampstead & Mayfair Development Limited
Fahed Hamad Saif Bin Fahad And Abdulla Ali Obaid
Hamza Namera International Fzc
Fahiman Bhatish & Nania Nagpaul
Heman R.E.D. & General Trading Limited
Fakhruddin Properties Limited
Falcon City Of Wonders (L.L.C)
High Rise Properties(L.L.C)
First Homes Ltd O.F
Hircon International (L.L.C)
Flamingo Investments Limited
Hma Exec Limited
Fortisplus Holdings Limited
Horizon Infrastructure F Z C
Fortune Avenue Investment Limited
Hydra Properties (L.L.C)
Fortune Bay Investment Limited
I.R.Investments Holding Company Limited
Fortune Dxb Ltd
Ihab Sayed Mohamed Elwishy
Fortune Homes Investment Limited
Ilyas & Mustafa Galadari For Investment & Development Managment (L.L.C)
Fortune Investment Group (L.L.C)
Indigo Valley Inc Limited
Fortune Serene Limited
Infinity Emirates Investments Llc
Freej Development Limited
Innovvarc Holding (L.L.C)
G&g Partners Limited
International Merchnant House Llc
German Holding Group( L.L.C)
Investments House Co.(L.L.C)
Gholamreza Abadi & Shahrokh Nariman&yadollah Nariman&behnam Keivan
Ishraqah For Development Limited
Global Group Holdings Limited
Global Group International Limited
Jab Developments Inc
Global King Technologies Ltd
Jab Mosaistone Developments Inc
Global Procurment Fzc
Jad23 Investment Limited
Gold Vision Development Ltd
Jad24 Investment Limited
Golden Beach Properties Limited
Jad25 Investment Limited
Golden Land Development & Investment Limited
Gpd Investments L.L.C
Jamal Mohammed Alhassan & Bachar Bakri Almradi
Gpd Investments Spv One Limited
Jasmine Garden Limited
Grace Property Developer Limited
Jumeirah Golf Estates (L.L.C)
Green Desert Ventures Inc
Jupiter Estates Limited
Green Emirates Properties- Co.Psc
K M Properties (L.L.C)
Kaizen One Investment Limited (Offshore)
Meraas Holding (L.L.C)
Kd Paca 59 Limited
Kensington Global Investments Inc
Khalifa Majid Alabbar
Mirgana Resources Ltd
Khuyool Investment L.L.C
Mismak Properties Co (L.L.C)
La Ploma Limited
Mohammad Aqil Ali & Ahmad Ali Alzarooni
Limitless ( L L C )
Mohd. Hussain & Bros
Links Properties Investment Limited
Mohd. Hussain & Bros
Liquid Assets Limited
Mre Global Investment Group Fzc
Lokhandwala Builders International Ltd
Lootah Real Estate Development Est
Msaab Mohammed Alzwaid & Hamad Ali Aldubikhi & Saleh Ibrahim Alqasir
Lootah Real Estate Investment
Muhammad Nabeel Joz
Lux Real Estate
Muhammad Nasir Muhammad Iqbal & Safia Nasir
Luxor Investment Limited
Nadeem Mohammed Zafar
Lyra International Limited
Nakheel Co.( L.L.C )
M E Development Llc
Nauman Abid Properties Limited
Maadhad Saleh Mezar Alromaithi
Ncc Urban Infrastructure
Madain Properties Co. (Mada'in) (P.J.S.C)
Neel Devcons Limited
Madison Holding Fzco
Neel Properties Limited
Mag Group Fze
Neo Solutions Limited
Mahdi Amrollahi (Partner) Antar Marzooq (Owner)
Neptune Properties Investment Ltd
Mahmoud Reza Azizi
New World Investment Ltd
Oakgrove Global Ltd
Oasis Group Ventures Ltd
Mammut Group Fzco
Olive Ponit Limited
Mandate International Limited
Omniyat Properties Development Corporation
Manhattan Real Estate Holdings F.Z.C
Optimo Arabia Limited
Marina Arcade Real Estate Llc
Opulence Holdings Limited
Marina Breeze Limited
Orbit Holdings Ltd
Marina Crown Real Estate (L.L.C)
P&p Properties Ltd L.L.C -rak
Marina Exclusive Limited
Marina Star Limited
Paramount Real Estate Llc
Mars Properties Investment Ltd
Parshwa Holdings Limited
Matex Estate Ltd
Paxion International Fze
Memon Developments (Fzc)
Pearl Dubai Fz- L L C
Memon Property Ventures (Fzc)
Mena Capital Investment Llc
Petrochem Realty Fze
Mera Home Ltd
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Phoenix Holdings (L.L.C)
Rufi Century Tower Ltd
Plus Internatinal Two Limited
Rufi Down Town Res Ltd
Plus International One Limlted
Rufi Gardens Ltd
Plus International Three Limited
Rufi Gulf Greens Ltd
Plus Properties Llc
Rufi Heaven Limited
Pnd Investments Ltd
Rufi Luxury Heights Limited
Point Development Ltd
Rufi Park View Limited
Premier Group (Fzc)
Rufi Rose Gardens Limited
Premier Group Properties Inc
Rufi Royal Crest Ltd
Premiers Property Developers Limited
Rufi Twin Towers Limited
Prescott Enterprises Ltd
Rufi Water Front Residency Limited
Prescott Holdings Limited
S.P. Oasis Limited
Prescott Investments Ltd
Sahara Livings Limited
Profile Residence Limited
Profile Zero Five Five Limited
Sameer Mahmoud Al Ali
Pyamod Developments Fze
Sameet Prakash Dhamecha
Pyamod International (Fze)
Sanali Holding Fze
Qureshi Faisal Abdul Aziz
R.K.M Real Estate (Llc)
Ramada Real Estate L.L.C
Sayed Amjad Husain
Ramadan Mousa Mishmish
Schon Investments Limited
Rani International Development (L.L.C)
Seasif Group Fzco
Rashed Darwish Alketbi
Seasons Development Limited
Rashed Mohamed Mahran Al Bloyshi
Seastar Properties Limted
Rayan Adnan Ibrahim Abduljabbar
Real Estate Bank
Realty Capital Middle East Fz-llc
Seracom Holding Limited
Reef Real Estate Investment Co (L.Lc)
Sevanam Holdings Limited
Reliance Estate Developmant
Seven Tides Ltd
Remah Holding Limited (Offshore)
Shaikh Holdings Limited
Rescom Holdings Limited
Shanti Builders & Developers Limited
Riviera Holdings Limited
Sharm Investment Co. Limited
Sheffield Real Estate Llc
Roland Developments Fzc
Sheth Estate (International) Limited
Romeo & Juliet Tower Limited
Sidra Holding Limited
Romil Investments Ltd
Rose Homes Investment L L C
Sienna Lakes Ltd
Royal Holdings Limited
Silver Star Tower Limited
Sky Estate Limited
Smart Home Properties
Torch Select Ltd
Smart Investment Limited
Town Center Management Limited
Sobha International Limited
Trend Capital Gmbh & Co. Dubai Sport City Kg
Sobha Investments Limited
Trident International Holdings Fzco
Sobha Properties Limited
Sobha Ventures Limited
Triplanet International Limited
Sokook Investment Group
Triveni Builders & Promoters Ltd
Souq Residences Fzco
Uae Waterfront Group Limited
Spain Select Limited
Uk-cig Developments (Jvs) Limited
Stallion Developments Ltd
Umesh Kumar Vinodrai Chug
Star Developers Limited
Star Surveying & Evaluating Services
Universal Developers (Fzc)
Sternon Developers Limited
V Resorts Ltd Fouad Barbar(Owner) / Bsa(Developer)
Vascon Trading Ltd
Sum Sum Developers (Fzc)
Venus Properties Investment Ltd
Sun Valley Holdings Limited
Victory Heights Golf Residential And Development Company (Llc)
Vision Avenue Homes (Fzc)
Sunland Nur (Joc) Limited
Sunland Waterfront (Bvi) Limited
Volcano Investment Properties Limited
Swiss Tower L L C
West Avenue Limited
Syann Palm Ltd
Westar Properties Ltd
Syann Park 1 Limited
York Shire Corporation Limited
Syndicate Sealine Limited
Yra Enterprises Limited
T F G Real Estate Broker
Zenith Real Estate Development Llc
Zero Five Zero Limited
Takmeel Investment Limited
Tameer Holding Investment (L.L.C)
Tanmiyat Real Estate Development Taskeen Properties (Khaled Heikal& Hesham Heikal& Suaad Mohammed & Ahmad Mohd)
The Lagoons ( Llc)
The Onyx For Development Limited
The Palm Hotel And Resort Fzc
The Pavillion Holding Limite
The World (L.L.C)
Tima Holdings Ltd
DUBAI REAL TIMES
MARKET TRENDS UPDATES REGULATIONS // // LAWS&& ANALYSIS
Your questions answered by Jacqueline Latham, DLA Piper Middle East LLP
Q. My lease is due to expire in the next six months and I do not plan to renew it. When I entered into my tenancy contract, I paid a deposit of Dh10,000. Will I be able to get all of my security deposit back and do I have to give my landlord notice that I want to terminate the tenancy?
DUBAI REAL TIMES
A. With respect to the security deposit part of your query, Law No.26 of 2007, which was amended in part by Law No. 33 of 2008, provides that a tenant should hand back the leased property in the condition in which it was received at the time of leasing - fair wear and tear excepted. In addition, the Law allows a landlord to essentially retain the security deposit upon termination of the lease period, to ensure the maintenance of the property; however, the landlord must return any post-maintenance excess monies from the security deposit to the tenant. As such, if you return your property to your landlord in the same condition as when you leased the property, then in theory, your full security deposit should be returned to you. In respect of the non-renewal of your tenancy agreement, and without having seen your actual tenancy agreement, you should notify your landlord of your intention not to renew your tenancy at least 90 days prior to the expiry of your current tenancy agreement.
Q. I work at a finance company and am trying to sort out a mortgage package and am baffled by the reference of a standard mortgage form in the Mortgage Law. I have been trying to locate such a form for a few weeks now but have been unsuccessful. Where can I get this form? A. Firstly, you should ensure that you are complying with Law No. 14 of 2008 concerning mortgages, by being registered and licensed to provide property finance in the UAE by the UAE Central Bank. If you are not, then you should cease undertaking any mortgage activity until you are fully compliant with the Law. In respect of the standard form, this is more a case of standard information. The mortgage provider should have a standard letter, also containing the text in Arabic, that sets out specific information, namely, the loan amount; the loan term and the property details and this letter should be signed by the authorised signatory.
Q. I am currently negotiating the terms of a mortgage with a local bank and though I have read a lot about the commencement process in respect of mortgages in Dubai, I would like to know the process concerning the termination of a mortgage. A. To terminate a mortgage, you will need to submit the original title deed, the original letter from your bank requesting the termination of the mortgage and the original mortgage contract, to the Land Department. As you would expect, a fee is payable and the current cost is Dh1,000, in addition to a knowledge fee of Dh10. Q. I am not actually a Dubai resident but I did invest in an off-plan property in Dubai last winter, which I was hoping to use for future vacations. It is my understanding that the developer has not even started the construction yet and I feel quite helpless as I live miles away. How can I make a complaint? A. As the law currently stands, Law No. 8 of 2007 (concerning escrow accounts) provides that a developer must start construction of its project within six months of receiving all of the necessary approvals relating to that project, whilst Law No. 9 of 2009 (which clarified the previous interim registration measures) gives RERA the power to cancel a project upon consideration of a grounds-based report. In such an event, a purchaser will receive a full refund in accordance with the Law No. 8 of 2007, and Law No. 9 of 2009 prescribes that this should be done within the earlier of: a) one year from the date of revocation of the contract; or b) sixty days from the date of resale of the property. As the implementation of regulations supporting Law No.8 of 2007 and Law No.9 of 2009 are widely anticipated to be published shortly, and such regulations will hopefully set out some clear steps to resolve cases like yours, then assuming that you are still fulfilling your obligations under your sale and purchase agreement (e.g. paying any purchase price instalments when due), you should initially register a formal complaint with RERA online via their website until the supporting regulations are published.
Jacqueline Latham is a Legal Consultant (England and Wales qualified), Real Estate at DLA Piper Middle East LLP, Dubai, www.dlapiper.com
Published on Aug 2, 2009
The official magazine of Dubai Real Estate Regulatory Agency (RERA). Published by Sterling Publications Dubai. www.sterlingp.ae. Cover stori...