Dubai: Smaller residential units are selling faster than the larger family homes, according to the latest sales trend witnessed by the major developers as well as the industry observers. Smaller units also yield higher rental income per square feet for home-owners and investors who see a faster return on investment, compared to larger units.
The latest Dubai Property Review Q3 2016 report by leading real estate consultancy Asteco has revealed increasing pressure is being placed on landlords as budget conscious tenants continue to place emphasis on downgrading to smaller units or relocating to cheaper communities to get better value for money. Apartments in Jumeirah Village Circle and Dubai Sports City saw rates increase by 2% and 3% respectively – the latter also recorded the highest growth over the year, averaging 13% as demand for affordable housing increased.
“The real estate market is shifting towards the mid-market segment and towards smaller units – where the real demand is picking up,” Mahmood Shaikhani, Managing Director of Shaikhani Group, said. “As a developer, we have witnessed this shift for some time. That’s why we have been developing properties for the young, trendy and upwardly mobile small families and couples who do not need large premises to live, but a small, cosy and elegantly styled smaller family home.
“Since most buyers in Dubai are expatriates and hence prefer to go in for smaller apartments such as one- and two-bedroom units. It is increasingly evident that smaller units are more in demand in the Dubai property market.”
Dubai-based Shaikhani Group recently announced the launch of Family Home concept with Dh799,000 in its latest project – Gardenia Residency at Jumeirah Village Circle – that includes a kid’s room within the One bedroom hall (1BHK) apartment – effectively creating two bedrooms for families to promote property buying amongst end-users.
Gardenia Residency will see the development of 59 studios, 89 one-bedroom apartments, five two-bedroom apartments, seven three-bedroom simplexes and seven duplexes.
The initiative comes with an attractive 50:50 payment plan that allows the property buyers to pay up to Dh399,500 or 50 per cent till project handover with the balance payable after the handover. In the first phase, the company is offering 100 homes that will be sold on first-come-first-serve basis.
“Our aim is to attract end-users and small families to shift from rented homes to their own freehold homes without putting much strain on their finance – which is a major issue with fixed-income small families,” Mahmood Shaikhani, Managing Director of Shaikhani Group, said.
“Our Family Homes initiative will help boost the real estate market in Dubai that offers a wider choice to the end-users who can now choose the best options available in the market. As a long-term player in the UAE’s real estate market, Shaikhani Group has a strong development pipeline with more than 2,100 apartments and office space worth Dh3.5 billion.”
The project will be handed over in 2018 – when buyers are expected to make the 50 per cent payment while the balance could be paid in 24 months – that will reduce the financial pressure on the buyer and help them make payments easier for them.
In Dubai, nearly 34,000 residential units have been announced by developers so far this year. Real estate advisory firm Cluttons expects the total number of completions this year to be around 8,300 units. This is expected to be 12,212 units in 2017, with 20,915 completions in 2018.
“Going forward, the real demand will only come from the real buyers as we have seen the gradual price adjustment has eliminated the speculators from the markets over the last two years. The market is now more real and there is a clarity in which direction it is heading to,” Shaikhani said. “Therefore, we are extending our arm to help new couples and families with attractive payment plans to move to their new homes as we start delivering new projects in the first quarter of 2017.”
Shaikhani Group is developing 11 projects that will deliver 2,100 residential and commercial units in Dubai Sports City, Jumeirah Village Circle and Dubai Silicon Oasis. Of these, the company is in advanced stage of completion of Dh1.5 billion worth of projects involving 1,250 units while the rest are at the beginning of the development cycle that are expected to be completed by 2020.
Four of these projects will be located at the Jumeirah Village Circle while one in Arjaan at Dubailand.
The Dubai-based company in May this year launched its Dh220-million Gardenia Residency in Jumeirah Village Circle, with investors being offered a post-completion payment plan of up to 10 years by banks. Work has started on the project, comprising 164 serviced apartments, and is expected to be completed in 2018.
Shaikhani Group, which comprises of 12 business entities, employs more than 350 people with an annual turnover exceeding Dh220 million (US$70 million). The group is credited to have delivered more than 30,000 residential units in Pakistan and UAE, making it one of the largest property developers in Pakistan.
The company’s existing projects that are being developed, includes Champions Tower I, II, III and IV and Frankfurt Sports Tower – all located within Dubai Sports City as well as Cambridge Business Centre at Dubai Silicon Oasis.
Founded by the late Abu Baker Shaikhani, a self-made entrepreneur and a realtor in Pakistan, the group has come a long way to establish itself as a global conglomerate with footprints in different countries across the world. The group’s businesses are being led by the second generation, Abu Baker Shaikhani’s four sons who were personally trained by the patriarch.
About Shaikhani Group:
Shaikhani Group traces back its origin in 1978 in Pakistan when Abu Baker Shaikhani, a Pakistani entrepreneur, started a business in selling tea.
He later added masala, soap and household items to his list of products. After gaining experience in many trades, he focussed on property business initially in buying and selling of properties in the Sindh state of Pakistan, mostly in Karachi – the country’s largest city.
In 1978, he ventured into real estate development and undertook a residential project with 600 apartments. He successfully delivered them. This marked the real foundation of the Shaikhani Group.
The company went on to become one of the largest private sector property developers in Pakistan. In 2013, it delivered 3,200 apartments – the largest in the country that year.
By 2015, the company delivered more than 30,000 residential in different parts of the world. Leveraging on its strengths for successful real estate development worldwide, the group later identified untapped, emerging and growing markets, and diversified its source of revenues by expanding trading, manufacturing and other businesses.
Overseeing the global operations of the multi-billion dollar international business conglomerate with diversified interests in real estate development, trading, manufacturing and IT, the group is presently headquartered in Dubai and spread across 90 countries in Asia, Africa, Europe and the Middle East.