RAK Properties’ Sameh Muhtadi on why Ras Al Khaimah is a magnet for investors

Ras Al Khaimah’s (RAK) publicly listed property developer recently reported that its revenue surge to Dhs1004.89 million in 2023, dwarfing last year’s Dhs408.22m. Net profit rose to to Dhs201.82m, a significant rise from Dhs30.79m in the prior year. Total assets grew to Dhs6.46bn, while total equity reached Dhs4.30bn, demonstrating the company’s enduring strength and growth.

Property sales in 2023 reached Dhs2.8bn, driven by new project launches and a marked increase on the Dhs511m figure in FY2022.

Development achievements for FY2023 include the full sell-out of high-profile residential projects such as Julphar Residence, Bay Residence Phases 1 and 2, and several others. RAK Properties also fortified its hospitality segment, celebrating the success of the Intercontinental Ras Al Khaimah Mina Al Arab Resort and SPA and the inauguration of the Anantara Mina Al Arab Hotel and Resort.

Sameh Muhtadi, CEO of RAK Properties, said 2023 has been a year of ‘take-off’ for the developer.

Muhtadi spoke to Gulf Business before the report on the rising popularity of RAK with investors and tourists, the company’s recent rebranding and its plans.

Why do you think Ras Al Khaimah (RAK) is booming as an investment destination?

As the global investment landscape evolves, smart investors are seeking new opportunities and Ras Al Khaimah is quickly emerging as a destination of choice. With its strategic location, favourable business environment and diverse investment sectors, RAK offers compelling advantages for investors seeking to maximise their returns.

The emirate offers tremendous potential for the luxury residential, hospitality and tourism industry, carried by a healthy economy and consistent ‘A range’ ratings by agencies such as Fitch and S&P. The emirate’s unique, low-risk financial landscape allows investors to take comfort in a stable and long-term growth environment that offers attractive returns.

We believe that regional and global investors can capitalise on the lucrative and safe opportunities of the emirate, creating a benchmark in mixed-use development and providing long-term value to their investments. Over the years, collaborative efforts between the real estate and tourism sectors have seen the emirate carve out a unique value proposition in the UAE — a destination located less than an hour away from one of the world’s most recognised business hubs, and under four hours’ flying time of one-third of the world’s population, making it a viable and attractive option for business and inward investment.

What are the factors contributing to boosting RAK’s tourism sector?

There are several factors. Over the past year, there have been several major investments confirmed, specifically into the real estate, tourism and hospitality markets, with multiple new large-scale hotel projects announced for prime locations.

Upcoming launches by RAK Properties include the Anantara Mina Al Arab Ras Al Khaimah — the emirate’s first Maldivian-inspired overwater villas complex, and Nikki Beach Resort and Spa Ras Al Khaimah. The 155-hotel key resort will include rooms and villas, and guests will have access to the brand’s signature Nikki Spa, Tone Gym, and restaurant concepts.

Moreover, RAK’s spotlight on eco-tourism including pristine beaches, rugged mountains, mangroves and historical landmarks, attracts an increasing number of visitors each year. Home to turtles, dolphins, flamingos and even the occasional whale, RAK’s location is one of its crowning features, and tourists are drawn to this natural setting. The hospitality sector is not only attracting tourists but also driving interest from developers and global hotel brands.
Over the next few years, RAK plans to increase its hotel capacity to more than 12,700 rooms, as it prepares to welcome 1.11 million tourists by 2025.

How do you think the RAK Vision 2030 is driving growth in the northern emirates?

RAK is striving to become a leader in sustainable tourism by 2025, targeting a 40 per cent increase in the sector, to attract higher numbers of foreign tourists and investors in a way that would ultimately boost the wider employment market.

As a testament to the success of the tourism diversification strategy, RAK’s attractiveness has continued to grow amongst both domestic and international investors. RAK’s vision has also widely enabled the emirate’s economy to diversify with 38,000 businesses from more than 100 countries operating in over sectors, with no single sector contributing more than 30 per cent to overall GDP. A lot of initiatives were implemented in line with the vision, enabling businesses to thrive and for people to stay and continue to invest.

Tell us more about RAK Properties projects and what is in the pipeline.

We are in a very exciting period, with several new projects having launched, and more to come.

Multiple projects such as Gateway Residences 2, Marbella Villas phase 2, Bayviews Residences and Cape Hayat were sold out and this is a testament to the exceptional investor confidence in our developments. We also announced our premium beachfront residential development, Porto Playa which was also sold out — located on Hayat Island in Mina Al Arab.

Hospitality is boosting revenue streams. The InterContinental Resort & SPA has proved to be very popular and is delivering excellent revenue and the opening of the five-star Anantara Resort and SPA will add considerable additional appeal to our overall hospitality offering.

We continue to forge strategic partnerships with some of the region’s most exclusive brands, including our most recent international partnership announcement with Nikki Beach Global.

We are deeply committed to the long-term growth and development of RAK and have a sound strategy that looks to build on the success of our recent launches to further contribute to the government’s vision.

What are some of the unique features of RAK Properties’ developments, and how do they set them apart from others in the market?

We are fortunate to have a beautiful natural waterfront setting in Mina Al Arab within which we build our developments. It adds something extra special to what we offer to our clients in RAK.

By integrating the natural environment into our communities, and protecting the beautiful mangroves and the authentic wildlife that surrounds us, we truly believe in creating sustainable communities for generations to come.

We deploy disruptive and leading technology in all aspects of our construction. Very recently we used artificial intelligence in in the design and construction of one of our latest developments, Porto Playa, a beachfront lifestyle residence.

You recently rebranded RAK Properties, what prompted this move?

We undertook a rebrand to mark the new direction the company is taking and for it to be the manifestation of our vision. Our new concept of ‘enhancing lives and places’ embodies the spirit of the emirate, showcasing RAK Properties portfolio of luxury beachfront projects, including residential, commercial, and mixed-use real estate.

We wanted a brand that helps elevate RAK as a world-class destination attracting tourism and investments from around the world.
To reflect the company’s evolution from a pure development company to a more customer-centric, lifestyle-driven organisation, we called for the creation of a new brand identity that is reflective of where the company is today.

What is your outlook for the real estate sector in 2024?

The UAE’s real estate sector has traditionally been a significant contributor to the country’s economy. Despite macroeconomic volatilities impacting the global real estate landscape and lifted interest rates, the country witnessed strong momentum in the last quarters, signalling a steady growth pipeline in 2024. We believe the real estate market in the UAE will stabilise in the coming months.

Moreover, RAK seems to be enjoying an off-plan property launch boom. The emirate has seen a steady flow of residential developments, and high-profile hotel and resort launches.

A trend we are noticing is the huge interest in branded residences and expect this to continue in Dubai and RAK as the cities further cement their reputation as one of the sought-after destinations for luxury living in the world.