Those private Dubai developers, who have free funds, continue to implement their plans in the field of the new real estate properties construction despite all the pandemic risks, but with one hand on the emergency button, keeping an eye on slightest changes in the global situation.
They have to make sure that there is no sudden and complete cessation of the developers’ activities, as happened in 2009, when real estate market experienced a sharp breakdown.
“We believe that the post-coronavirus period will have its own advantages,” said Mohammad Saeed Al Shehhi, CEO of Dubai Real Estate Center.
“Today, no one can tell, what the urban landscape will look like tomorrow. But the utmost attention to all events together with awareness are the two new success factors, which, combined with flexibility in decision-making, should ensure the implementation of various alternative scenarios, if necessary, and equally effective.”
When the crisis of 2008 broke out, the real estate market instantly leveled down all the liquidity of the real estate units, which led to the halt of all planned real estate projects, that either had not been started, or had been stopped long before completion. After this, another year or two passed before the activities of even such large developers as Emaar, Damac and Nakheel in the field of construction of new real estate resumed.
Smaller companies representing other private developers returned to the game only by the end of 2011 – the beginning of 2012.
This time, Dubai’s developers are hoping that a similar sudden breakdown and halt of all activities won’t happen, no matter what the last blow of COVID-19 would be.
Al Shehhi confirmed that his company will “maintain a steady pace” of work process on projects that are still even in the concept development stage. In particular, the Dubai Real Estate Center developer plans to launch two new projects in the nearest future.
The first of those, “Hive Coliv” is a coworking and coliving project with a good name that combines hints of “beehive” and “joint space for life and work”. This type of real estate, as imexre.com recently revealed, is now in great demand among young professionals in Dubai.
If the plan works, project construction will begin in the middle of the year. Taking to account the demand, the developer targets young people as their main customers. Before the COVID-19 crisis broke out, there were several similar projects in the stage of the concept development in the coliving and coworking domains, developed by Emaar and Nshama and targeting the same investors’ category.
The second project of the Dubai Real Estate Center, scheduled for launch in the nearest future, is located on Al Wasl Road. It consists of residential buildings, but also includes retail spaces. The developer’s plan is to start work on these new projects in the Q4 2020, but more information will be revealed later.
However, taking into account the opinion of other developers about the suspension of new launches, a reasonable question arises: should problems in the economy and undermining investor confidence in the market caused by the virus be a limiting factor when deciding on new launches?
“We will closely monitor the situation unwinding over the next few months,” Al Shehhi replied.
“We will also pay close attention on the new directives, if any, issued by the government and/or regulatory authorities, before taking any further actions,” he added.
The current situation in the Dubai real estate market requires business to take decisive actions to reduce risks and plan scenarios for fast or slow growth due to the impact of the situation on liquidity, refinancing and increase or decrease in third-party risks.
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