By Suchita Kapur www.business24-7.ae
Even though lease rate for units in the world’s tallest tower, Burj Khalifa, are not yet established, analysts believe the expected rental rates for commercial spaces in the tower will handsomely beat the ongoing rates in other established high-rise buildings of the world, such as the Petronas Towers in Kuala Lumpur and the Sears Tower (now Willis Tower) in Chicago, United States.
Office space in the world’s tallest tower is expected to fetch Dh600 per sq ft on an average, double that of other competing high-rises across the world.
“The rates are still unclear at the moment. We expect the rental to be around Dh600 [$163] per sq ft plus depending on the floor level,” Porush Jhunjhunwala, Manager, Commercial Leasing at Better Homes told Emirates Business.
“The average office price around the world is between $30 and $40 per sq ft and in signature towers such as the Petronas in Kuala Lumpur and the Sears in Chicago, it is around $60 and $85, respectively,” he added.
“On the prices, we can recommend to our clients anything in the range between Dh550 and Dh650 per sq ft, which amounts to $150 to $180 per sq ft,” he said.
“Rentals for Burj Khalifa will depend on the demand and supply in the tower. As of now, we have received a lot of interest from large corporates, who are enquiring for office space in this prestigious tower. It is still too premature to derive at a rental what this tower will command,” he said.
As expected, the height of the floor will also be a major factor determining the commercial rent. “The expected premium should be around five per cent as you go higher by five floors every time,” Jhunjhunwala added.
Another important factor will be the service charges, which again are unclear at the moment.
“We are also not sure what would be the service charges for the offices, which will be also be an important component of the rent,” he said.
As far as selling prices of the residential units are concerned, analysts expect them to appreciate soon, with delivery dates set from next month onwards.
“The apartments are currently listed for average sale prices ranging from Dh3,500 to Dh5,000 per sq ft. However, we believe as the apartments are handed more and pace of transactions improve, there should be an improvement in the achievable sales prices,” said Vineet Kumar, Head of Sales at Dubai’s Asteco Property Management, while talking of residential units.
“Office space is currently asking average selling price from Dh6,000 per sq ft to Dh7,500 per sq ft,” he said.
The units on the higher floors would, obviously, go for a higher price and according to Kumar, a premium of around 15 per cent in sale prices is achievable for higher floors.