Dubai based luxury property developer Damac is confident in the Emirate’s property market and has dismissed fears of another market crash.
Ziad El Chaar, managing director of Damac, told Gulf Business that the property market fundamentals are different now to those before the crash in 2008, with Dubai now wielding some of the most developed laws for off-plan real estate development in the world.
“For a developer to launch a project today they need to buy the plot, pay in full, make the handover, get the construction permit, assign a main contractor and put 20 per cent of the construction budget in escrow. Only then will the Real Estate Regulatory Authority (RERA) allow them to launch the project,” said El Chaar.
“The absence of regulation and the over leveraging present in 2008 is not here anymore,” he added.
El Chaar also suggested that Dubai had never declined from the perspective of property demand, and as a result the company had been preparing in 2009 and 2010 for the resurgence of the market.
“People waited until they believed that the market had bottomed down before engaging in buying properties again in Dubai, but the fundamentals of demand were always high,” he said.
Many of Damac’s recently announced projects have been focused on the 28 million square-foot master development Akoya, which includes an 18-hole PGA Championship golf course built in association with the Trump Organisation.
Damac has tied various brand associations into the project, including villas styled by Italian designer Fendi and the recently announced Trump Estates, housing over 100 mansions.
El Chaar described Damac’s brand associations as “limited editions” similar to those launched by staple luxury brands like car manufacturer Rolls Royce.