Transforming property investment in Dubai: Shard’s co-ownership model explained

Shard, a property ownership company, is differentiating itself in the UAE’s high-end real estate market, through a new model.

The firm announced that its co-ownership model will open to investors starting July 1, and promises to make luxury real estate more accessible to a broader audience. This model, which has seen success globally, allows for part-ownership of premium properties, enabling more individuals to partake in Dubai’s booming real estate sector.

Shard’s co-ownership scheme offers 1/8th ownership of luxury properties, complete with the owner’s name on the title deed, highlighted the launch announcements. This model provides all the benefits of premium property ownership at a fraction of the cost, it added.

The company has selected some of Dubai’s most sought-after locations for its listings, including Downtown Dubai, Bluewaters Island, and Palm Jumeirah. These areas are known for their luxurious lifestyle offerings, from world-class dining and entertainment to stunning views and prime beachfront access.

Seamless ownership

Shard ensures a hassle-free experience through its dedicated management services. The company explained that it handles all aspects of property management, from maintenance and repairs to scheduling stays for co-owners. This service is facilitated through a custom website and mobile app, providing transparency and ease of use.

The co-ownership model simplifies the complexities of property ownership, such as large financial commitments, paperwork, and ongoing maintenance. Shard’s dedicated team supports co-owners throughout the entire purchase and ownership process, making it an appealing option for those looking to enjoy the perks of premium property ownership without the associated burdens.

Strong partnerships

In a move to strengthen its market presence, Shard has partnered with leading real estate agencies and proptech companies, including BetterHomes and Huspy. These collaborations enhance Shard’s ability to list and acquire top-tier properties, leveraging a vast network to offer exclusive opportunities.

The co-ownership model, popular in regions like the US, Europe, and Southeast Asia, is expected to rapidly gain traction in the UAE, driven by the booming real estate market. Shard’s entry into this market aligns with the increasing demand for flexible and cost-effective property ownership solutions.

To explain the new model, István Juhász, CEO and co-founder of Shard, speaks to Gulf Business.

Q: What is the co-ownership model and how does it work?

The co-ownership model is a modern approach to owning luxury properties, designed to make high-end real estate more accessible.

Under this model, each property is divided into 1/8th shares, allowing up to eight individuals to co-own a portion of the property.

Each co-owner is listed on the title deed, ensuring legal ownership and allowing for personal use of the property. Specifically, with Shard’s model, each owner is entitled to exclusive use of the property for 44 days a year. These days can be scheduled flexibly, either for personal enjoyment or to rent out the property for income.

Unlike timeshares, Shard’s co-ownership model ensures that co-owners hold actual ownership stakes in the property.

This means any appreciation in property value benefits the owners directly.

Shard handles all aspects of property management, from maintenance to rental services, providing a hassle-free ownership experience. Owners can sell their shares at any time through Shard’s digital platform, which also allows them to manage their bookings and track rental income.

Q: What types of properties does Shard offer for co-ownership?

Shard curates a selection of the top 1 per cent of premium properties in Dubai’s most desirable locations, such as Downtown Dubai, Marina, Creek, and Palm Jumeirah.

These properties come fully furnished and equipped with high-end amenities. By partnering with leading real estate agencies like BetterHomes and Huspy, Shard ensures that their listings represent the best opportunities in the market.

The properties are tailored for a luxurious lifestyle and are managed entirely by Shard to maintain their high standards.

Q: How is co-ownership different from fractional ownership?

Co-ownership differs from fractional ownership in two key ways:

1. Direct ownership on title deed: In co-ownership, each co-owner’s name is directly listed on the property’s title deed, ensuring clear and direct ownership. In contrast, fractional ownership typically involves owning shares in a company that holds the property, which can feel more detached and does not always guarantee direct access to the property.
2. Personal use and flexibility: Co-owners in Shard’s model can personally use the property for a set number of days each year (44 days). This provides an opportunity to enjoy the property first-hand. In fractional ownership models, properties are often rented out long-term, meaning owners rarely get to use them.

Q: What is the legal framework that supports co-ownership in Dubai?

Dubai’s legal system supports co-ownership through laws such as Law No. 27 of 2007 on Encumbrance of Real Property Units (the “Joint Property Law”) and Law No. 7 of 2006 regulating Real Property Registration in the Emirate of Dubai (the “Property Registration Law”).

These laws provide a clear structure for co-ownership agreements, outlining the rights and obligations of co-owners. They also ensure that multiple individuals can be listed on a single title deed, allowing for up to eight co-owners to share legal ownership of a property.

Q: How will investors benefit from co-ownership with Shard?

Co-ownership with Shard offers several benefits for investors such as access to premium properties as investors can own a share of luxury real estate starting from Dhs200,000 making it a more accessible way to participate in Dubai’s high-end property market.

Additionally, instead of investing in a single property, investors can spread their investment across multiple properties, enhancing their portfolio and reducing risk.

This model, futhermore, brings in high rental yields and caapital appreciation. Co-owners can generate income from renting out their property share and benefit from the property’s increasing value.

As part of our services, Shard handles all aspects of property management, including maintenance, taxes, and rental services, ensuring a seamless experience for co-owners.

Another benefit of co-owning a property is that investors can enjoy 44 days of personal use per year, allowing for a luxurious lifestyle or the opportunity to use it as per their convenience.

Q: Does co-ownership impact existing market inventories or inspire new developments?

Co-ownership models can significantly influence the real estate market.

In markets where co-ownership has been introduced, such as the US with companies like Pacaso, the availability and desirability of premium properties have increased.

Co-ownership can make high-end real estate more accessible, driving demand and potentially inspiring developers to create properties specifically designed for this model.

In Dubai, Shard’s entry into the market could lead to similar trends, encouraging the development of properties that cater to the co-ownership model’s unique requirements.

Q: What motivated Shard to introduce the co-ownership model in Dubai?

I was inspired by the challenge of finding an appealing real estate investment option.

Traditional property purchases required significant capital and concentrated risk, while real estate funds felt impersonal. The idea of co-ownership offered a balance—allowing real ownership at a lower entry cost.

Given Dubai’s booming real estate market and the high demand for flexible, luxury living options, introducing the co-ownership model here was a logical step.

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