By Chuka Uroko www.businessdayonline.com
At a time when the property market in other countries of the world, including Nigeria, are caving in under the heavy impact of the global economic recession, the property market in Dubai is relatively stable
Dubai is one of the seven countries that make up the UAE which, according to history, a little over half a century ago, was a mere desert country, but is today “a city of stark contrasts—of sand dunes and skyscrapers, camels and fast cars, museums and malls”. It was gathered that the catalyst for this change was the discovery of oil reserves in the UAE which, unlike Nigeria where oil windfall is shared for personal gains, the oil wealth has provided the springboard for an economy that has so diversified that oil now accounts for a little above five percent of the country’s GDP.
Harbouring most of the world’s architectural wonders such as the tallest building in the world—the Burj Khalifa with 168 floors, the only seven-star hotel in the world—Burj Al Arab, one of the world’s largest shopping malls—Dubai Mall, among others including the New Metro, Dubai is unarguably, the world’s most glamorous tourism destination.
In 1982, the country relaxed its land laws, giving foreigners 99 years leasehold and freehold on land which attracted foreign property investors, leading to the explosion in property development and the boom in the property market that saw unprecedented appreciation in both capital and rental values before the slowdown. According to Abdul Kadiri, a Dubai-based Nigerian property investor, “where it takes a minimum of three months to get land titles and governor’s consent in Nigeria, here, in less that 72 hours, you have perfected your land titles and you don’t even have to pay through your nose to get building approvals”.
Tax-free environment is one of the advantages which Dubai offers foreign investors and businesses operating in the country and according to Rob Burns of The First Group—a British property development firm in Dubai—who spoke to visiting Nigerian property writers, “it is not only that there is no tax on corporate profit, but also there is no personal income tax which has the benefit of attracting skilled personnel to the country”.
The country, he added, has over 70 percent free zones which offer companies 100 percent ownership of their businesses and no restriction in repatriation of profits to their home countries. “It is easy to understand why so many international corporations choose Dubai to house their global headquarters which, in turn, fuels demand for property to accommodate the migration of staff to the country”, he added. Though Burns did not say what could be the percentage rise in demand for property in a given period, he however disclosed that tourism and high hotel occupancy rate are the major drivers of demand for property in the country.
Nigerians account for a significant percentage of foreign property owners/investors in Dubai and as Burns, who is The First Group’s chief operations officer (COO), put it, about 40 percent of his company’s clients are Nigerians.” Between January and now, over 20 Nigerian prospective property investors have visited our company and indicated interest to buy”, he enthused, noting that what is seen as a downturn in other countries is regarded as “a market correction in Dubai which will ensure better return on investment in the long run”.
For savvy Nigerian investors, there are prospects in the Dubai property market, because given what is happening in the country now in spite of the downturn, when the world economy recovers and the country’s property market rebounds, what to see of the market can only be left to the imagination. It will, put blandly, be wonderful in terms of return on investment.
In its 20 years as one of UAE’s premier independent property developer, The First Group has established strong presence in Dubai, especially at the Sports City. The Dubai Sports City is part of the six spectacular theme worlds that will make up Dubai land which is set to become the country’s most attractive, vibrant and diverse areas for living and working, offering the perfect Dubai property investment. In this city, The First Group has four skyscrapers including The Diamond, The Matrix, The Spirit and The Bridge all of which offer both residential and investment opportunities.
The Matrix has an unrivalled location overlooking the recently launched Els Gulf Club, the Canal and the buzzing Riviera-styled waterfront. It is further enhanced by the sensational light-infusing exterior design, floor-to-ceiling windows, vast unusual balconies and beautifully crafted contemporary interiors offering the ultimate in modern open plan living. In the same vein, The Spirit, a light-reflexive19-storey tower, offers its residents exclusive urban chic living, featuring a range of contemporary executive suites, sanctuary suites and one-bedroom apartments, as well as The First Group’s Pure White Health Club and rooftop jogging track. Its prestigious location is within walking distance of the many retail, leisure and sporting amenities of the Sports City which is fabulous in its own right. These are potential areas of investment opportunities in a country where visitors enjoy relaxed luxurious lifestyle and sports followers enjoy sporting events to the fullest.