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Hope, expectation and ejari
Relationships built on hope can founder on expectations while partnerships that come together to achieve realistic goals tend to be far more lasting. Two recent initiatives in the Land Department have demonstrated the potential to make the more positive side of the argument. First, A Land Department-led initiative to create an Arab world-wide valuation institute and introduce uniform standards and practice came to fruition. At a closed meeting at Atlantis, The Palm representatives of the leading valuation authorities in the GCC, Lebanon, Algeria, Egypt, Morocco and Yemen, agreement was reached on the constitution of the Arab Appraisal Foundation (AAF), thereby formally establishing the organisation. This gives the Arab world a single leading cooperative authority to determine valuation standards and practices. An authority equivalent in influence to the leading international institutions such as the US Congress-approved Appraisal Foundation and the UK’s Royal Institution of Chartered Surveyors (RICS). The second initiative, the formal full activation of the ejari online registration system for rental contracts, had equally far reaching but nevertheless achievable goals; the main one being to provide a formal basis for the relationship between tenant and landlord in Dubai, thereby avoiding any potential mismatch between two diverse sets of expectations. To my mind this is one of the most important measures taken to regulate the rental strand of Dubai’s real estate sector and align the expectations of various stakeholders. This measure has profound implications not only for the parties to rental agreements in Dubai but for the real estate sector as a whole. Its starting point was the provisions of Law No.26 of 2007 Regulating the Relationship between Tenants and Landlords which in turn has as its main aim introduction of comprehensive registration of rental contracts in Dubai. The effect has been to establish that clearly defined and stated non-negotiable rights and obligations now form the basis for a thorough and rigorous system of regulation of rental agreements in Dubai. At the same time the effect has been to put in place the means to regulate the sector as a whole and link this to its interaction with Dubai’s other government departments. I believe this provides the basis for one of the soundest and best regulated rental/ lease sectors anywhere in the world. Two initiatives at two different levels. The first, international and with particular application to the Arab world. The second, local and particular to Dubai property rental. Nevertheless these are two measures that continue to add to the single big achievement of ensuring Dubai continues to lead the way in property registration and regulation.
Sultan Butti Bin Mijrin
Director General, Land Department
DUBAI REAL TIMES
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AAF step to Arab real estate standardisation
I was so happy at the gathering we had at Atlantis, The Palm, with the 12 Arab country representatives. What had started as a small meeting between RERA members sharing a vision of regional reference in the matter of real estate regulation, become a reality by the commencement of this gathering. Yes, the first step always starts with a dream, and our step started with the support of more than 20 Arab countries and a commitment from 12 other countries to move forward to the next level. The launch of Arab Appraisal Foundation (AAF) is one step in the direction of regulating our regional real estate sector and sharing the valuable knowledge we have among us. The standards and continuous education that AAF will give to its members will be the torch that will light the professional way to a global standard, and AAF will be the counterpart for international organisations like WAVO, TEGOVA, RICS and others. AAF started big with the support of ARADO and many Arab countries, giving us hope that we would gain the fruits of their members’ knowledge quickly. Sharing knowledge of the systems implemented in countries like Jordan, Egypt and UAE will benefit professionals in all Arab countries. Practising valuation within the Arab world, based on shared approved standards, will make the results of valuation and decision making better, which will result in enhancing the real estate market in the Arab world. Changing into better sectors, following ‘best practices’, and useful information sharing, will make our societies better, bringing advancement in all fields of real estate.
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DUBAI REAL TIMES
Pan-Arab property valuation Foundation receives official approval
Land Department President leads a 12-country summit to an agreement on the constitution of an umbrella standards-setting organisation
Land Department-led initiative to create an Arab worldwide valuation institute and introduce uniform standards and practices came to fruition recently at a closed meeting of the profession’s leaders in Dubai. HH Sheikh Mohammed bin Khalifa Al Maktoum, President of
the Land Department, presided at a one-day summit held at Atlantis, The Palm, to formally establish the Arab Appraisal Foundation (AAF) and agree on its constitution. The initiative is the result of sustained cooperation between the Land Department and the Arab League-sponsored Arab
Administrative Development Organisation. Sultan bin Butti bin Mejren, Director General of the Land Department, formally presented the constitution of the new organisation, which is intended to have a role which will see it become the Arab world’s equivalent of influential international institutions such as the
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US Congress-approved Appraisal Foundation and the UK’s Royal Institution of Chartered Surveyors (RICS). In fact, these two standardsetters with the World Association of Valuation Organisations and their equivalents in Europe and Singapore provided crucial input into the AAF, which was first announced during a three-day Arab League-backed real estate summit in Dubai in November 2009. Leading up to the event, the Land Department, RERA, and the Appraisal Foundation were the main movers pushing for the AAF. At that conference, The Second Arab Real Estate and Urban Development Conference, Mr. Bin Butti hailed: “The Arab World’s commitment to cooperation and to integrating standards and practices.” He added: “The Arab Appraisal Foundation can take valuations standards-setting to the highest professional level and by doing so
(from left to right) Sultan bin Butti bin Mejren, Director General of the Land Department , HH Sheikh Mohammed bin Khalifa Al Maktoum, President of the Land Department, and Rifhat Al Faouri, the AADO’s Director General
underpin the integrity of real estate markets, further opening these up to international investment. The launch of the AAF is a genuine milestone in the integration of Arab national real estate markets and international capital markets, a regional trend pioneered by Dubai.” The summit gave the final seal of approval to the foundation’s constitution first mooted during that earlier meeting. Effectively, it has been shown the green light to develop and set the professional standards for real estate practitioners and encourage integration and the spread of common practices across the Arab world’s real estate sector. Mr Bin Mejren highlighted the importance of the initiative in opening the door to pan-Arab economic and commercial activity in the real estate sector. Recommending acceptance of the final proposals for the AAF to the leaders of his peer organisations from across the Arab world, including 16 representatives from the GCC, Lebanon, Algeria, Egypt, Morocco and Yemen, he said: “The AAF represents progress and opportunity for the Arab world.” The delegates responded positively, and in a final closed session chaired by Marwan bin
Ghulaita, Chief Executive Officer of the Real Estate Regulatory Agency, they officially accepted the Director General’s proposals and ratified the AAF’s constitution, formally bringing the new agency into being. Mr Bin Mejren said: “This is an example of what can be achieved through cooperation and marks a huge step forward for integration of standards across the Arab World and the extension of best international practice. This initiative will strengthen ties and encourage greater economic cooperation. Its importance to the further development of a panArab economic bloc cannot be exaggerated.” There was an enthusiastic response from the delegates who travelled to Dubai for the summit and they particularly welcomed the contribution of the Arab Administrative Development Organisation (AADO). Rifhat Al Faouri, the AADO’s DirectorGeneral, said: “I am proud of what has been achieved and to be associated with this initiative which has the potential to change so much. Yet this is only the beginning. The Foundation has a big task ahead and there is a great
deal of work to be done if it is to achieve its objective. Nevertheless, I am confident that today we have taken the first steps which will prove of huge benefit for the Arab world’s real estate sector.” “This can only be good for the sector as a whole, for investors, and - perhaps most importantly of all - for the economic and social development of the Arab world,” he
stressed. Mr. Bin Ghulaita said: “The AAF will help professionalise the real estate sector in Arab countries which will mean all stakeholders can participate with confidence in the people and practices involved in their transactions and that those from outside can engage with it in the knowledge that common practices apply.”
A one-day summit to formally establish the Arab Appraisal Foundation and agree its constitution was held recently
DUBAI REAL TIMES
Online registration rule for lease contracts
Ejari e-registration transforms regulation of rental market
he Real Estate Regulatory Agency (RERA) announced that from March 13, all rental/lease contracts for Dubai properties must be registered through its new Ejari online portal. The announcement makes effective the provisions of Law No.26 of 2007 Regulating the Relationship between Tenants and Landlords in Dubai and requires all individuals and companies acting as landlords to register tenancy agreements. Landlords and tenants who fail to comply with the new ruling will find that their tenancy agreements fall outside the protection offered by the law and government agencies and will not be able to enforce the provisions of the agreements they enter into. The law clearly states: ‘Judicial bodies and governmental departments and authorities should not consider any claim, case or execution based on a tenancy contract unless the same is registered with the Agency.’ Announcing the new ruling and the full activation of Ejari, its stateof-the-art online registration system, RERA formally called on everyone involved in drawing up and entering into such contracts to ensure full compliance and avoid violation. Mohammed bin Hammad, Director of the Real Estate Relations Regulatory Department in RERA, said: “We have launched the Ejari electronic registration web service to meet the requirements of the
Mohammed Bin Hammad
law and RERA’s vision and mission to establish a robust regulatory system for the rental market and protect the rights of everyone involved.” “Today’s announcement puts in place a key mechanism which will go a long way towards stamping out violations and malpractice in the rental sector.” He explained. “The aim is to ensure all lease contracts, and the parties to such agreements, are registered and the details recorded. This will lead to the Dubai rental market becoming one of the most transparent and accountable
anywhere and, at the end of the day, one of the best regulated.” He continued: “Registration through Ejari offers full protection of their rights to all parties with tenancy agreement. It ensures these rights are recognised, upheld, and enforced by all government agencies. It establishes full transparency between landlord and tenant, fully integrates rental contracts into the legal framework and opens up the possibility of being able to revise these contracts seamlessly in the event of disputes.
At a different level, full implementation of Ejari registration will enable the authorities to construct a full and accurate picture of Dubai’s rental market which will play a crucial role in its planning for the future of the sector and its ability to influence such factors as the supply side of the market, and ultimately, the level of prices.” RERA has endeavoured to make Ejari e-registration of lease/rental agreements as easy and accessible as possible and Bin Hammad said: “Individuals and companies should have no difficulty in using the system.” Registration through Ejari is a simple process requiring little technical knowledge and only the basic details of agreements are entered. These include information such as details of the property, the name of the rental company, and terms of the agreement. Once the agreement is entered into the system and registered, it is allocated a unique barcode which acts as its reference throughout the life of the contract. RERA will keep its own record of the agreement and update changes to the register as these occur. The Ejari system provides a full portfolio of services beyond registering the initial lease agreement. Renewals, cancellations, transfers and terminations can all be logged. Bin Hammad said: “Ejari will
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ensure rental agreements are fair and transparent to the parties involved and that their terms and conditions are given full weight. Today’s launch has moved us closer to the stage where we have one of the best regulated rental markets in the world and best practice is the norm across Dubai’s rental sector. Landlords and tenants should consult the website www.ejari.ae”
committee to be executed in Dubai court.
Landlord and tenant relationship
The RERA website www.rpdubai.com has information on the topic of rent, concerning both landlord and tenant. Read the ‘frequently asked questions’ section to find out about basic rules. What is Law No 26? The relationship between the tenant and landlord has been regulated by issuing Law No 26, 2007 by the ruler of Dubai his highness Sheikh Mohammad bin Rashid. The related law was formed in Dubai on November 26, 2007 and executed by RERA. What should be covered under Tenancy Agreement? The landlord and tenant relationship is composed after signing a writing tenancy agreement which should cover the following: • the unit description • the purpose of agreement • the owner name • land registration number and location • Duration and the rent allowance. If duration is unspecified in the agreement it shall not exceed the time on which the lessee was paying his rent. When any party has an intention not to renew the tenancy agreement, the party intended to do the same should send 90 days notice to the other party prior to the expiry of the rental agreement. What is the role of committee in case of disputes ? In case of dispute and the arbitrator is unable to do his job, or refused, and landlord and lessee failed to assign a new arbitrator, the committee should assign, on the request of any of them, arbitrators to continue the arbitration process. • The decision made by the RERA is responsible for forming all decree and regulations to execute this law and producing to the Executive Board for approval. Note to landlords - Landlords in Dubai need to be aware that RERA is now regulating the relationship between Landlords and Tenants. Law No. (26) of 2007 is applicable to leased properties in the Emirate excluding free accommodation provided by natural persons or judicial persons to their employees. The tenancy must be governed by a written tenancy contract agreement with all the relevant information . and must be registered in RERA by Law otherwise, neither party may assert a claim if a dispute should arise. The Law is fair to both the Landlord and the Tenant and should be read by both parties as both are legally bound by the Law. The Law defines the scope of implementation of the Law and also details chapter articles relating to’. Note to tenants - Tenants needs to be fully aware that the property is the asset of an owner, and the tenant has no right to alter, damage, change the interior or exterior of the property without express written permission form the owner. The property shall be left in the same condition as is handed over to the tenant. This shall be monitored by a documented report called the ‘Entry Condition Report’ which shall serve as a protection to the tenant against the claim of a landlord for damage or condition of a property which was present before the tenant’s occupation. Both parties must sign this. Who pays for exactly what i.e. repairs, maintenance, etc shall be stipulated in the tenancy contract, and both parties are bound by this agreement. Upon leaving the property, an ‘Exit Condition Report’ is completed by the Tenant and Landlord (or Landlord’s Agent) and both reports must match. It is a good idea to take some photographs of any damage which you are concerned about to ensure you are not blamed for damage, have the Landlord or Landlord’s Agent sign these immediately to protect yourself. Providing a Tenant has paid the rent, is not breaking any Laws, and using the property for which it is an ‘approved use’ by municipality, then one should expect peace and quiet enjoyment in your home.
Common and community property rules for tenants
Do be aware in hi-rise buildings in Dubai, the rules for Tenants occupying and residing in multiunit dwelling complexes are very straightforward. The Landlord or Landlord’s agent should provide you with a copy of the rules for the building. Most of these rules are set by the Master Developer of each area and are out in place to ensure harmonious living for residents, occupants and tenants. Acceptable behaviour, courtesy and respect are paramount. For example, in many instances you will not be able to hang your washing out of a window or over a balcony as this detracts from the local area and becomes ‘unsightly’. If everyone did it, the building would develop a poor image. Excessive noise, and lack of consideration of others, is often the cause of disputes. Therefore, newcomers to Dubai, should be aware that respect of the local culture is one of the reasons that over 180 different nationalities currently live in harmony, Dubai likes to keep it that way.
DUBAI REAL TIMES
Dubai 2009 property business permit numbers soar to 6,871 licences as RERA reclassifies sector's key activities. Professional real estate industry now a reality, says licensing official.
proposition. We have been convinced office of an international property company, Organising property exhibitions, • Organising property auctions, • Property inspection services, • Managing and supervising Owners Associations, • Property administration and supervisory services, • Managing timeshare property, • Brokerage leasing timeshare, • Mortgage brokerage, • Property training institutes, • Valuation services, • Property consultancy, • Mortgage consultancy. Mr Al Hashemi added: “Classification and registration have raised standards across the sector and ensured professionals are qualified to carry on their activities and are properly accountable to their clients, as are developers. Each is clearly listed in specific categories of activities and registered as having the necessary qualifications to carry out his task as a member of a professional body. Companies and individuals licensed to work in the real estate sector in Dubai are also registered with RERA where their details can be checked just by going to our rpdubai.com website. We have reached this stage through discussion and cooperation with the DED. We have both put a considerable amount of time and effort into revising the system to make sure the end result is right for the market.” He concluded: “The professional practices that are emerging as standard across the sector is a profoundly positive step for real estate activity in the emirate and ensures that what we offer here in Dubai is among the best available.”
ast year RERA issued 6,871 pressing for and winning approval licences to companies from the Ministry of Labour to have and individuals authorising them to undertake commercial activities in the property sector. This announcement, which follows the agency’s comprehensive reworking of the licensing classification and qualifications it inherited from the Department of Economic Development (DED), indicates there was a surge in activity in the sector last year. The five basic categories of property-related commercial activities previously recognised by the sector have been extended to 19 as RERA rigorously pursues its policy of professionalising Yusuf Al Hashemi the sector. It has linked registration to qualifications and property professions recognised on effectively outlawed unqualified visas and labour cards. and unregistered practitioners from Yusuf Al Hashemi, Head of RERA’s carrying out work in the sector. Licensing Department, said: “RERA Brokers for example, one of the has carried out a complete and key players in the sector, have faced comprehensive review of property possibly the strictest clampdown activity in Dubai. We have reclassified with their activities clearly stated each of them and defined the and their registration to operate specialists who will carry them out now conditional on being properly and in the process, we have divided qualified and meeting the requisite some of the categories which were criteria laid down by RERA to be previously combined. included in one of its colour-coded Our overriding concern has zone of operation categories. been to clearly establish the rights The plus side is that investors, and responsibilities attached to buyers, sellers and the rental sector each property professional. This can be confident that in RERA creates clarity for their customers registered practitioners, they are and provides a solid basis for trust. dealing with properly qualified The fact RERA approved almost professionals who can give them the 7,000 licence applications last best advice. There are advantages year demonstrates the real estate for the practitioners too, with RERA professions have bought into the
The five basic categories of property-related commercial activities have been extended to 19. RERA has linked registration to qualifications and effectively outlawed unqualified and unregistered practitioners from carrying out work in the sector.
throughout that the best way to achieve effective regulation is to create a professional sector wedded to best international practice. We are heading in the right direction and moving ever closer towards our goal.” The 19 real estate business activities classification issued by RERA and which has replaced the five previously recognised include the following: • Property development, • Renting out and administering property interests on behalf of others, • Renting out and administering property interest on your own behalf, • Buying and selling land and property, • Rental brokerage, representative
DUBAI REAL TIMES
Finalisation of three regulations
ERA has finalised three regulations necessary to clarify the relationship between the property owners and developers under Law No. 27 of 2007 Concerning Jointly Owned Properties in the Emirate of Dubai (‘JOP Law’). The regulations will also define the responsibilities and duties of owner associations in managing the jointly owned property scheme to ensure the continuity of quality property management through regular services and foster a spirit of harmony and goodwill between the owners and occupants. The regulations, which are expected to be released soon, will also require developers to prepare the documentation necessary to register owners associations and will encourage transparency in service charges and service provision. The three regulations include: • Jointly Owned Property Declaration Regulation (JOPD Regulation) The JOPD Regulation specifies the information which must be included in a jointly owned property declaration. For example, entitlements of each of the units in the jointly owned property, the community rules and a site plan of the common areas of the jointly owned property. • General Regulation: The General Regulation defines the responsibilities and duties of the developers in relation to the creation of jointly owned property schemes including the responsibilities of the developer before and after initial registration of the owners’ association, the requirements of building management statements, and a number of consumer protection provisions which require developers to give detailed disclosure documentation in relation to the project and the unit to prospective purchasers. • Association Constitution
RERA has finalised the implementing regulations for Law No. 27 of 2007
The Association Constitution is intended to detail the rights and responsibilities of every Owners’ Association in Dubai. It is a standard document and may not be varied by a developer or by an Owners’ Association. It also provides the functions and powers of the owners’ association. Among other things, the Association Constitution gives further details in relation to the association’s powers and obligations to: • Enter into contracts with maintenance companies and licensed service providers; • Obtain insurance for common areas; and • Collect and recover service charges from the owners of units. It also defines the process for nominating and electing the Board of the association and appointing specialised management companies approved by RERA to assist the association in performing its functions.. Once the regulations come into force, RERA will begin registering Owners Associations and will take appropriate steps to ensure that developers comply with the JOP Law and its regulations. bodies, real estate development companies and associations. It visited residential and commercial complexes and met experts in service charges and maintenance assessment and assessed the best methods and systems for calculating the fees. In another step, RERA studied internal practices of master developers and sub-developers in the emirate in relation to calculating fees for services and maintenance, and conducted interviews with professional companies in the market. It also visited project sites and conducted field studies of both the building and the main project. Through applications submitted by developers and owners for approval of services and maintenance charges, the Owners’ Associations section received the applications, examined and studied the lists of services and maintenance and their fees as well as carrying out field visits of the projects. RERA has approved fees and services for 51 real estate projects of jointly owned properties. in freehold areas in coordination with the developers and conducted comprehensive meetings with the owners of the projects clarifying their rights, duties and obligations to be met by the developer, and his disclosure of all financial and management matters concerning the operation of the project during the period of management by the developer as well as provide details of all work carried out with the Master Developer. They must provided accurate statements and assist the new Board of Directors of the Owners Associations to oversee and manage their own property, providing support and assistance to them if asked. RERA will always provide support to them by the RERA Owners Association section which so far has established thirty (30) Owners Associations. RERA also supports developers and encourages them to form an interim owners association so as to be involved in managing and preparing the budget.
RERA establishes 30 Owners Association
RERA carried out field visits to the premises of joint owned properties
Land Department signs registration accord with Malta
Director General hails first step in a series of international partnerships
RERA approves service charge fees for 51 real estate projects
RERA began to study the system of imposing fees and services for jointly owned properties through access to best practice for services and maintenance charge fees model. It compared standard regulations, laws governing the global ways of calculating the fees for services and maintenance in the region; in addition to sending an official delegation to observe best practices in Singapore and visiting governmental bodies, regulatory
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The Land Department has signed a bilateral technical accord with the Government Property Division, within the Parliamentary Secretariat for Revenues and Land in Malta. The agreement puts in place a formal channel for the two partners to share knowledge and expertise. The 12-month rolling agreement is the first in a series of international partnerships planned by the Land
The CEO of RERA has honoured the following employees for their achievements Ishtar Jasem for doing the news archive (for 2007-2009 )
Department which will result in it becoming formally associated with the leading land registries and cadastres. HE Sultan bin Butti bin Mejren, the Director General, signed the agreement on behalf of the Land Department and HE The Hon. Dr. Jason Azzopardi, the Minister for Revenues and Land, signed the agreement on behalf of Malta, which was also represented by HE Anthony Tabone, the Consul-General for Malta in Dubai. The agreement will see the two countries consult across the full range of real estate issues particularly the technical aspects of property registration and regulation.
at the Land Department said: “ The benefits to owners, investors and end-users, in particular, will be substantial and result in quick, simple seamless transfer through all stages of the immediate and related procedures conferring title while reinforcing top-to-tail regulation and protection.”
An abundance of creative ideas
Juma bin Humaidan, Deputy Director General of Land Department, accompanied by Mohammad Sultan Thani, Assistant Director-General of Land Department honoured twelve staff in the department who had come up with innovative ideas, all of which have been implemented, on a number of aspects of the internal workings of the department. So far a total of 112 creative ideas have been suggested in the scheme which was launched several months ago. Suggestions have
The Land Department has introduced its ‘next generation’ services which includes a same-day on-the-spot registration procedure. The move allows property transactions to be completed securely and promptly online faster than anywhere else in the rest of the world. Sultan Bin Butti Bin Mejren, Director General of the Land Department said, “Today has seen the immediate activation of the technological infrastructure stage which will support the new advanced services and electronically integrate processes as diverse as registration, pre-registration, escrow accounts and a state-of-the-art e-services system.” Mr. Khalifa Al Suwaidi, IT Director
been received to improve systems with the aim of fostering a positive work environment that helps staff creativity and innovation; thereby explaining the slogan ‘There is no ceiling for creativity’. Juma bin Humaidan said, “The principle that staff are encouraged to participate in the development and continuous improvement of performance and services creates a favourable environment for innovation. This ensures the achievement of organisational excellence, and promotes a culture of continuous development through genuine participation of the staff, who feel that he is part of the success.” Against the backdrop of three of her staff having winning ideas, Majida Ali Rashid, Senior Manager of Strategy and Institutional Development said that if a staff member felt the satisfaction and sense of belonging in his career he would be induced to excel,
Rasheed Suleiman for his distinguished performance at work
Majida Ali Rashid congratulates three departmental staff from Strategy and Institutional Development
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Khawla Alawadi for organizing the meeting for the Arabic appraisal association
particularly as he watched his ideas turn into reality, and recorded his name on the ‘wall of creators’ which the department has started to fill with the suggestions already submitted.. According to Majid Al Hosni Sun whose name is on the wall of the creativity: “Seeing my name on the wall is a large incentive, greater than any financial reward. It is sufficient to know that my ideas are being used.” He said that “The discretion of senior management has prompted me to offer more ideas, and it takes a strong motive to put forward more ideas.” He added that he is keen to preserve the intellectual property rights of staff.
Recently, Land Department has received a number of government delegations who wished to witness and have work experience in the Customer Service Department. Groups varied from the Ministry of Works, to a delegation from Roads and Transport Authority in Dubai. Delegations reviewed the practices and learned that it is most important to provide full information and assistance to customers to expedite the completion of transactions. Methods and procedures were explained as well as the psychological aspect of dealing with clients. Treat customers ‘as if you were in your home’ is a slogan that DLD works to; as they treat them with kind attention and a professional manner. Since the establishment of the Customer Care Department Service, there have been a number of initiatives such as the ‘Watch yourself’ campaign where an employee could watch a recording of himself in a particular situation, and make his own suggestions as to how he could improve. Another campaign was the idea of a personal assistant accompanying a client from the moment of entering the building until he completed his business. Land Department received the Dubai Award for Excellence in Government to customer satisfaction
Dubai Bank - From left to right - A senior representative of DLD; Marwan bin Ghalaita, CEO of Rera; Sultan bin Mejren, Director General of Dubai Land Department; Mohammed Amiri, Head of Retail Banking at Dubai Bank; Tariq Al Farsi, Head of Branches, Dubai Bank; and Masoud Alansari, Government Zone Branches Manager, Dubai Bank
starting from 2004 to 2006, as it has developed many of the leading attributes in the area of customer service such as PDA, in addition to the Customer Information Centre, which takes care of the needs of its clients from the first moment they enter the building. Aisha Mansouri Corporate Excellence Department, Ministry of Works stated that “the experience of the Land Department in the area of customer service experience has led to huge innovative initiatives which have made the department special.”
Banking, Dubai Bank, said, “Currently, companies in the UAE with 25 employees or more can avail of Dubai Bank’s Payroll Account, which offers special benefits and services to their employees. However, in line with the bank’s innovative product strategy, we have offered LD employees a unique bouquet of services and privileges to serve their needs which we believe they will find extremely useful in planning
their personal finances.” Sultan Butti bin Mejren, Director General of the Dubai Land Department. “For our payroll requirements, we wanted to sign up with a bank that fully understands the needs of our employees. As a bank with strong fundamentals and a keen eye for innovation and customer service, we are confident that Dubai Bank will meet all expectations.”
Dubai Bank offers custom-made payroll packages
In another demonstration of its high-value offering to both retail and corporate customers, Dubai Bank has announced its tie-up with the Land Department (LD) to offer custom-made payroll packages for its employees. As part of the agreement, Dubai Bank will provide them with special benefits on assetbased financing products, including personal and motor financing. The bank will also offer special packages for property Ijarah and covered cards. Mohamed Amiri, Head of Retail
Sultan Butti bin Mejren, Director General of Land Department held an open meeting with his team, congratulating them on their achievements over the past year. He stated his gratitude to the staff for their outstanding efforts in achieving the goals and objectives of the Department.
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Land Department’s designer perfume
Land Department is celebrating its 50th birthday this year with the launch of an attar (perfume) of its very own
s part of its 50th birthday celebrations, the Land Department has unveiled its own perfume called Attar Al Ardh (meaning ‘Scent of the Land’). “The perfume was launched to coincide with 50 years of existence of the department,” said Mohammed Sultan Thani, Assistant Director-General at Land Department in Dubai. “We have been working on Mohammed Sultan Thani this unconventional idea for almost a year now and finally we been incurred. It is about having our created a distinct fragrance for us,” own perfume brand. It has just been he said. distributed to our employees. As of Although he did not disclose now, we don’t have plans to sell it in the cost of creating the perfume, the market.” Thani said: “The idea is not to trade The Assistant Director General in the market to make money. The said: “We hope that when a client issue is not about the cost that has smells this perfume he will recall his
visit to our offices. It is composed of a mixture of aromatics, a mixture of old and new sensory fragrances. This circle of thought and senses corresponds to the circle of work we do from reservation to registration, from old methods around to new methods of dealing with the evolution of the real Majida Ali Rashid is to increase input into the Human estate sector.” “This aroma is for one of the five Resources area of encouraging our senses, the others are taken care employees to attain the highest of in our offices covered by the level of best practices, so that reception and service we provide to our customers, the reason for this Department being set up, will all customers,” he added. Thani said the department is also benefit from top notch service in looking at different ways on how to any of the sections that they visit.” She explained, “We are serious circulate the fragrance across every developing institutional corner of the in d e p a r t m e nt ’s performance, which enhances the capacity of workers to apply the building. T h e concepts of modern management fragrance has and advanced customer service. been created Plans have been put into place to with the help help them achieve satisfaction, of Um Khalifa, a resource development, simplification local perfume- of procedures, documentation maker, he systems, and promote a spirit of creativity.” added. She added that “This fragrance M a g d a Said Ali Rashid, launch by Land Department Senior Manager exemplifies the idea of simplicity. of Strategy and However, another part of the I n s t i t u t i o n a l equation is the complexity of a D e v e l o p m e nt government institution which said, “Our plan simply carries out its duties.” for 2009-2011
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A measure of his success
ahmoud Seddeqi is a familiar sight at the Land Department offices as he visits the familiar atmosphere plus friends and colleagues he has worked with for over 40 years. “I came to Dubai as a young man of 24, having been recruited in my homeland of Karachi, Pakistan, to work for Dubai Municipality” he explains. “I had a job to go to, a new home to introduce to my wife and two daughters. That was 42 years ago. We all settled down happily and have loved the place since then.” Just one month after working for Dubai Municipality, Mahmoud was transferred to the Land Department office, near the Municipality building at Dubai Creek, and worked there as a surveyor for 40 years until he retired in March 2008. “I am a surveyor; my job was to survey land, and the buildings on it. Later I was promoted to Deputy Head of the Survey Section.” Mahmoud was the man who went out and measured plots of land owned by UAE nationals, measuring and marking the
boundaries with string and pegs, as is still practised today. He drew sketches and diagrams showing location, size and other relevant information for official approval by the director, signed by the local committee, and then a site plan
was issued to the owner. The title deed was signed by the ruling Sheikh, the Chairman of Land Department, the late Sheikh M a k t o u m bin Rashid Al Maktoum. In the beginning the job of measuring was often supervised by accompanying co mmi t te e members and inspectors – there were inspectors for Deira side and inspectors for the Bur Dubai side. Measuring tape, theodalyite and other tools for the job used then are still used today. Figures were written down in feet and inches, being converted to metres by those that preferred it.
“Even though Dubai was smaller in the 1960s and 1970s, there was still too much work for us to do because there were only a few surveyors employed, and the department was much smaller. Sometimes, we had to work in the evenings as well as the daytime.” Mahmoud has seen the many changes that have occurred in the real estate sector here. “Where there was water before, there are now buildings,” he comments in wonderment. “I have seen many changes. I have worked for three Director Generals of the Land Department.” “In the old days, there were no ladies working here. Land Department was the last government authority to hire women. But now, there is a new generation that has started working and there is a need for more employees to do all the extra work, whether they are men or women does not matter, as long as they can do the job.”
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Arabian Ranches tops region in terms of the number of transactions
Deals worth Dh1,128.67 billion carried out in Dubai
he last week of February saw Dh1,128.67 billion worth of transactions taking place in Dubai, of which more than Dh429.36 million was tied up with mortgages for land and real estate totalling $395.32. This information is part of the weekly report of actions issued by the Land Department. The last day of the month witnessed a record 49 transactions to the value of Dh21.21 million on the Palm Jumeirah, and Dh15 million in Al Quoz, plus Dh15 million in the Al Nasser area. Arabian Ranches recorded nine mortgages for Dh28.85 million; Dubai Sports City had nine mortgages valued at Dh30.29 million, and the Palm Jumeirah had five mortgages for Dh45.23 million, with Emirates Hills Third recording four mortgages valued at Dh7.55 million. Dubai Industrial City had an area of 34.81 thousand square feet sold for Dh5.01 million. Palm Jumeirah had 15.28 thousand square feet which sold for
Dh6.46 million, and 14.86 thousand square feet in Al Qusais Industrial Fifth sold for Dh12 million. The last week of the month saw a record 124 transactions take place with a total value of Dh302.53 million. The most important piece of land was in Ramoul, recording an amount of Dh62 million, and another was in Al Mamzar at a price of Dh40 million. In terms of freehold villas and apartments, 381 villas and 363 apartments have been registered with a total price of Dh572.76 million. Of these, 18 villas have The last day of February saw 49 transactions to the value of Dh21.21 million take been mortgaged to a value of place on Palm Jumeirah Dh32.72 million, and 70 apartments have been mortgaged to a value of Dh92.79 million. 18 villa mortgages • 18 villa mortgages Dh32.72 million 293 villa and • 70 apartment mortgages Dh92.79 million apartments 70 apartment • 293 villas and apartments other financing mortgages other financing Dh447.25 million
381 villas and apartments Dh572.76 million TOTAL
Lands (Marsa Dubai) Sales Transactions
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Units (Marsa Dubai) Sales Transactions
Villa (Marsa Dubai) Sales Transactions
Index of Rental values in the Emirate of Dubai - Issue date (01/01/2010) Residential Units Free Hold (Apartments) The rental value of residential apartments - Per Thousands
Area Dubai Marina Studio From To 45 60 Avg 52.5 One Bedroom From To Avg 70 110 90 Two Bedroom From To Avg 80 160 120 Three Bedroom From To Avg 140 200170 Four Bedroom From To Avg 200 240 220
Dubai Marina District Investors ( 2009 )
Flat Investors ( Dubai Marina ) Top 10
The Total No. of Flat Investors in Dubai Marina District in 2009 was 3499 invertors. Country British Iran India Russia Pakistan uAE u.S.A Kazakhstan Canada Italy No. of 749 381 332 236 179 142 129 118 86 67 % 21 11 9 7 5 4 4 3 2 2
Villa Investors (Dubai Marina)
The Total No. of villa Investors in Dubai Marina District in 2009 was 20 invertors. Country Jordon Canada Latvia Pakistan uAE KSA Kazakhstan Iran uSA No. of 5 3 2 2 2 2 2 1 1 20 % 25 15 10 10 10 10 5 5 10
No. of 2 2
Land Investors (Dubai Marina)
The Total No. of Land Investors in Dubai Marina District in 2009 was 4 invertors.
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PROJECT OF THE MONTH
Damac Properties Co. LLC
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MARKET TRENDS & ANALYSIS
Ten predictions for 2010
Linda Benbow reports on Jones Lang LaSalle’s ‘Top 10 for 2010’ projections of the trends expected to shape the UAE real estate market this year.
he room was full, it was hush quiet as financiers and journalists waited to hear some happy news, hopefully. Leading real estate investment advisory company Jones Lang LaSalle had pronouncements to make about the industry and were willing to make predictions about the future of the industry … out loud. “The local markets have changed significantly following what happened globally, locally and regionally,” began Blair Hagkull, Managing Director, Jones Lang LaSalle MENA. “In 2010, the UAE real estate market is moving away from the off-plan sales model towards a longer term model based on secure cash flows. Real estate investment vehicles are being redefined as more interest is shown towards coinvestment vehicles. However, the general downturn in market performance is not affecting all locations or assets type equally. The level of returns is expected to be more stable in quality projects and locations as they are performing comparatively better than others. This flight to quality is significant as these are signs of maturity in a constantly evolving market.” JLL’s key predications are:
10. From asset creation to asset management
2009 marked the end of a transformational decade for the UAE real estate sector as the market shifts from a period of asset and value creation to that of asset management and value retention in 2010 and beyond. The shift in focus from creation of new assets to management and value enhancement of existing assets is a sign of maturity for the real estate market; Craig Plumb, Head of Research at Jones Lang LaSalle MENA said, “The opening of the Burj Khalifa in January marked the end of an era of transformation and, we believe, that a new era has begun where it is not so much about building new buildings, but more about making the best use of those already built. People will ask “how are we going to extract value from the buildings we have? How are we going to retain value? Quality management of existing assests is an answer with more attention being paid to value creation from existing buildings, rather than developing new buildings. To some extent, this means the turning off of the supply pipeline. We will obviously still see some new buildings coming through – a legacy of what has been happening during the past decade.”
9. From landlord to tenant market
The continuing demand-supply mismatch is bringing about a further shift in the balance of power from the landlords to the tenants. The
UAE real estate market is becoming increasingly tenant-friendly as it faces greater competition by increasing supply, lower demand, falling rents and higher vacancies. This is a beneficial situation for tenants
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as landlords are expected to offer greater incentives to retain existing tenants and attract new ones. Craig Plumb stated that about 30 per cent of all office supply in Dubai is currently vacant. So if you are a tenant, it means that you have a much greater choice of premises today than, perhaps you did, a year of two ago. This, of course, is unevenly distributed throughout the city and some areas are more affected than others. “There is going to be greater competition to both retain tenants and attract new tenants. Some of the things landlords will be looking to doing are: rent-free periods, willingness to negotiate leases, more flexible lease terms, more payment terms, contribution to fitouts, etc. There will be an increase in competition for tenants of all kinds.”
8. Real homes for real people
In the last five years, 60 per cent of the housing stock comprising luxury and secondary homes was targeted for 16 per cent of the market who were mostly investors and speculators. The market is expected to re-position in 2010 as it increasingly caters to the needs of end-users in the middle segment of the UAE real estate sector. This is a significant development for the industry as its priorities are shifting towards the majority of end-users from the earlier focus on investors in the high-end segment. Craig explained and prophesised: “There has been a shift away from the past five years where supply has been dominated by luxury, high-end and investments. We believe 2010 will have a market that is end-user driven, and more mid-market driven. This is not only for residential but also retail, hotels, schools, parks, clinics, etc.”
7. From global to local
Middle East real estate developers and investors are increasingly adopting inward looking strategies and are seeking more opportunities in local rather than international markets. Localisation of the real estate industry is an important trend as capital flows from regional entities shift towards domestic priorities. Mr Plumb: “We will see more local money staying within the region, investing in local real estate and projects. There will, of course, be selective investments abroad, but, mainly, there will be a trend to invest within the region which includes areas of high population such as Saudi Arabia, Egypt and Morocco.
6. Defining real value
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There is an important need to better define real value in a market with minimal transactions. Valuations are hampered by fewer transactions to benchmark as investors seek to find the ‘new normal’ in real estate capital values. Significant new initiatives are expected in the valuation profession as the region evolves into a more mature real estate market. “Defining the true value of an asset, a property, is difficult in this region due to a number of factors,” explained Craig. “Difficult, because there has been a lack
of transactions, particularly last year; difficult due to the lack of transparency, there is not much information available in the market. Difficult because there has been an inadequate regulatory framework, no requirement for owners to have their properties valued or declare their values, as would happen in many other mortgage markets. And, difficult, because we have a very volatile market which has changed dramatically over the past 18 months. We believe that 2010 will see a number of initiatives made to improve transparency, regulatory framework and to introduce more international ‘best practice’ into the valuation industry in the whole region. This is important as it will re-build confidence in the market, a necessary thing at the moment.
5. New financing model for real estate
Cash flow is critical as we expect debt markets to selectively ease in the coming year. Such a scenario results in an increased emphasis on equity and reinforces the need for co-investment vehicles. Scarce debt will make private equity and family wealth funds the preferred option due to their cash strong positions. Blair Hagkull stated: “There is a necessity to create a new financial market for real estate. Very clearly, there is no limitation in debt. It requires a new way of doing business. Today, even when banks provide finance, putting your land in as equity is no longer enough. Banks want to see cash. Cash is king. Cash shows commitment, certainty and, ultimately, confidence. Connected to this, we expect to see the repriorisation approach. Portfolios should continue with finishing current projects, rather than focusing on new supplies.” “We also expect to see consolidation in projects and investors. Consolidation is another buzzword for 2010” he predicted. “We also expect to see a ‘bringing together’ of different people who have different skills in real estate finance. We need to create more opportunities for coinvestors. Focussing on end-producing properties is not new across the world. But the focus is new in this market here: we are talking about 5-9 per cent gains on capital returns as opposed to 30 per cent+ which happened in the past few years. The irony is that currently there is an over supply of properties, but not many have incomeassets attached to them. If this state of affairs changes, it will attract international investments. Sometimes, boring is beautiful. The reality of income is good as opposed to speculation.”
4. New real estate investment paradigm
A greater emphasis will be attached to income producing assets as the regional real estate industry takes a longterm view on property. The trend of investors accepting lower returns is the ‘new normal’ which is increasingly becoming an industry reality. We are witnessing more investment decisions led by asset performance, credit worthiness and tenant quality. There is little investor
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appetite for incomplete projects that do not produce income.
3. Rebuilding trust and confidence
Lack of transparency and trust are major issues facing the UAE real estate industry. They have negatively impacted the UAE market and have eroded investor confidence. Effective regulation and greater transparency are some of the major industry challenges in 2010 and the years ahead. Craig Plumb said: “Although this is mainly to do with the government, it also affects the private sector. We are talking about on-going investor relations. If there was more transparency in the market people would understand where the supply and demand really is. Over time we will see hurdle rates reduced, less volatility, greater transparency and trust as we move from a phase of growth to maturity towards an established market,” he stated.
2. Generating additional demand
Generating additional tenant and occupier demand will provide a significant boost to market performance. This will be critical to the timing of recovery in the UAE real estate market. Many of the initiatives required in this area go beyond the real estate industry. The industry needs to implement structural changes to better position itself for the needs of end-users and occupiers. “The supply equation for the next ten years has already been written. The key focus now is to ask ourselves how we are going to fill these investments? How are we going to attract people and companies to come here to live and work? How are we going to attract long-term residents rather than those on a short-tem transit?” asked Blair Hagkull. Both government and private sectors should concentrate on providing demand drivers that will create a new world in the marketplace.
1. Selective stability
The UAE market will see a general decline in performance during 2010. The market will experience greater differentiation as some locations will perform better than others. This is in spite of the on-going decline in values, plus an oversupply and higher vacancy scenario. This selective stability will result in a polarising effect on the market and will give rise to distinct winners and losers in the real estate sector. “Long term, this country has tremendous assets going for it not only in resources and superior geographic location, but also a government and people working together to create something remarkable,” enthused Craig Plumb “There will be winners and losers in the real estate market. Certain areas, such as Sheikh Zayed Road, DIFC and Burj Khalifa area will do better than others because of quality, amenities and transportation
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provided for those who living there. The challenge is in the outlying areas. They offer a preferred location because of lower rents but are less attractive because of lack of amenities and maturity. This applies to commercial requirements too.” In summarising the report, Craig Plumb, concluded: “Creating an atmosphere of trust is essential for markets to maintain a competitive edge in challenging economic times. The need to rebuild confidence and
greater transparency is no longer optional but a necessity in the region’s fast evolving real estate markets. The rate of decline may be comparatively less in 2010 than in 2009 but the timing of recovery will depend on additional demand from both investors and tenants. As the markets mature, investors need to take a longer term view as the levels of returns are expected to become more stable and sustainable.”
The need to rebuild confidence and greater transparency is no longer optional but a necessity in the region’s fast evolving real estate markets.
Top 10 Predictions for 2010
• Owners will focus on the active management of properties versus new developments • Landlords will provide greater incentives to attract and retain tenants • Luxury developments will be repositioned for the middle end-user market • MENA investors and developers will be more active in local and regional investments • The valuations industry will become more professionally structured and regulated • Limited debt will require investors to consolidate and prioritise investment activities • Investors will accept stable rental yields as opposed to development profits • Increased government regulation and improved corporate reporting will rebuild trust in the market • Government policies will focus on creating longterm economic growth DUBAI REAL TIMES • Growth unlikely in 2010. Selective markets to remain stable at best
A little profit
t is better to make a small profit than no profit at all, is an old wise saying that has been handed down through the ages. After the past economically upsetting year, this adage applies with a heartfelt relief to some businesses who have been frantically endeavouring to survive the downturn. Deyaar Development PJSC,
significant challenges in 2009,” said Markus Giebel, Chief Executive Officer of Deyaar. “Despite such volatile conditions, Deyaar successfully handed over eight projects last year, including an Dh363 million project in Lebanon.” In line with global best practice, Deyaar has adopted a revenue recognition policy based on the recommendations of the International Accounting Standard Board (IASB) relating to the International Financial Reporting Interpretations Committee (IFRIC) 15 - Agreements for the Construction of Real Estate, to recognise revenue based on the completed contract method. In the case of the completed contract
Al Seef Tower
method of revenue recognition, the revenue and related profit for a project sold are recognised when the project is handed over to customers. Based on IFRIC 15 revenue recognition policy, the company’s gross revenues for the 12 months stood at Dh1.835 billion, an increase of 33 per cent compared to Dh1.382 billion in 2008 (restated as per IFRIC 15). The reported gross revenues of the company for 2008 (as per the percentage of completion methodology) was Dh2.956 billion. Based on IFRIC 15 revenue recognition policy, Deyaar reported a net profit of Dh30 million, a decline of 95 per cent compared to Dh6,54.7 million in 2008 (restated as per IFRIC 15). “In 2010, Deyaar will continue to focus on the completion of the consolidation of its projects
a regional real estate company dedicated to innovation, customer care and long-term sustainability, has announced its financial results for the 12 months ending December 31, 2009. Despite extremely challenging conditions globally, which have impacted the performance of the real economy worldwide and the property sector in particular, Deyaar continues to focus on its unique consolidation strategy, which has led to a reduced level of defaults and a higher paid-up value for each of the company’s sold and consolidated units. As a consequence, Deyaar has been able to reduce its level of provisioning related to receivables, leading to a continuously positive operational cash flow. “In the face of unprecedented threats to the stability of the global financial system, the worldwide real estate sector witnessed a range of
and timely collections of its receivables at home in the UAE, while simultaneously identifying strategic expansion opportunities overseas, including potential future opportunities in regional markets such as Lebanon and Saudi Arabia,” Giebel explained. “With six projects slated for handover this year and the ongoing completion of incomegenerating assets, in parallel to the continued stablisation of regional and international markets, we look forward to reporting continuous stable cash flows in 2010.” The total equity of the company stands at Dh6.75 billion as at December 31, 2009. “Deyaar’s sound fundamentals and prudent operational strategy, including generating stable income from property management and leasing activities, places the company in a prime position to benefit from the global recovery. Moving ahead, we will continue to focus on providing innovative solutions that meet the evolving needs of our customers,” said Giebel.
Home and abroad
Highlighting its global footprint with the recent inauguration of Burj Khalifa, the world’s tallest building, Emaar Properties PJSC has announced its financial results for the 12 months ended December 31, 2009. Annual net operating profits for the period reached Dh2.324 billion ($ 633 million), as compared to the restated net operating profits of Dh4.236 billion ($ 1.153 billion) in 2008. Annual revenue was Dh8.413 billion ($ 2.290 billion) as compared to the restated revenue of Dh10.717 billion ($ 2.918 billion) in 2008. The restatement of the 2008 profit and revenue relates to change in accounting method
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obligations towards properties delivered, which is also positively reflected in the revenues of the Company. In spite of opening two hotels during the year – The Address Dubai Mall and The Address Dubai Marina, the selling, general and administration expenses in 2009 were maintained at 2008 levels through implementation of appropriate cost control mechanisms. Although the profitability levels were maintained for the company’s core businesses, the net operating profit decreased due to provisions made by its associated companies in the financial sector, Amlak Finance and Dubai Bank, towards their loans and advances portfolio. The company also recorded lower fee income on property transfers due to discontinuance of such charges and lower net interest income due to utilisation of cash resources to complete investment
assets (Malls and Hospitality) during the year. The robust performance for 2009 - a challenging year internationally - is a result of concerted efforts to optimise resource use. Emaar also worked closely with all stakeholders to make the company resilient and deliver results. Emaar’s Hospitality and Mall subsidiaries were significant contributors to the company’s revenue stream, with the year witnessing the opening of two new hotels and the grand inauguration of The Dubai Mall, the world’s largest shopping centre, which attracted more than 37 million visitors in its first year of operation. Emaar Healthcare Group, the company’s healthcare subsidiary, opened its first world-class medical centre in Dubai late last year. Overseas, Emaar projects in India, Egypt and Saudi Arabia, all reached advanced stages of completion and will be ready for handover this year. Mr. Mohamed Alabbar, Chairman, Emaar Properties, said the company focused on the timely completion of existing projects across global markets through stronger resource optimisation. “The crowning achievement in our track record of successful project management
from percentage completion to completed contract method of revenue recognition in accordance with International Financial Reporting standards (IFRS). Fourth-quarter 2009 net operating profits stood at Dh923 million ($251 million), 41 per cent higher than the third-quarter net operating profit of Dh655 million ($ 178 million) and 149 per cent higher than the fourth quarter 2008 net operating profit of Dh370 million ($101 million). Emaar has delivered approximately 3,100 units during 2009 as compared to 4,900 units in 2008. However, the revenues by malls and hospitality businesses increased significantly. The company implemented a number of customer oriented policies, which assisted in maintaining its Gross Profit Margins at 2008 levels. These policies also enabled customers to settle their
The fountains at Dubai Mall
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and delivery is the inauguration of Burj Khalifa. From delivering the world’s tallest building to the world’s largest shopping centre, and further strengthening our ability to build world-class communities such as Downtown Dubai, we have proved our commitment to delivery,” explained Mr. Alabbar. Highlighting the success of its diversified growth model, the company’s subsidiaries in hospitality & leisure and shopping malls & retail contributed to developing selfcontained lifestyle communities in Dubai, which is also being rolled out in international markets. “During an especially challenging period for economies across the globe, Emaar contributed to the socio-economic growth and stability of Dubai by creating more than 12,500 new jobs through our subsidiaries. Domestic growth, catalysed by Burj Khalifa, will be the highlight of this year, as Emaar continues to focus on maximising long-term value for our shareholders,” said Mr. Alabbar. He said that while Dubai will remain an integral part of the Emaar growth story, international markets and new businesses will also make considerable contributions. “The opening of Burj Khalifa has underscored the can-do ability of Dubai and is a testament to its sustained growth potential.” This year, Emaar will also focus on middle-income housing as a strategic growth area to meet the growing demand for homes in emerging markets. According to recent estimates, demand for residential property in India will be over 7.5 million units by 2013, of which 85 per cent is projected in the mid and affordable housing segment – a trend observed in Egypt, Pakistan and other emerging markets too. In India, one of the company’s key growth markets, Emaar MGF Land Limited, the company’s joint venture in that country, has filed its Draft Red Herring Prospectus with the Securities and Exchange Board of India to enter the capital market with an initial public offering of Dh2.938 billion (INR38,500 million; $830 million). Emaar MGF Land Limited is also on course with the completion of
the Commonwealth Games Village 2010, a residential complex set in 27.7 acres in Delhi with an estimated saleable area of 1.8 million sq feet. The developer has made considerable progress with its master-planned communities in India, Syria, Morocco, Jordan, Saudi Arabia and Egypt, with several hundred homes to be handed over this year. With Tuscan Valley Houses in Turkey and Mirador Villas in Canyon Views in Pakistan, Emaar has already handed over its pioneering masterplanned communities overseas – a trend that complements the company’s delivery track-record in Dubai.
Cementing the deal
ASEC Holding, Citadel Capital’s platform company in the regional cement production, engineering and construction industries, has acquired an additional 9.48 per cent of ASEC Cement, one of its key portfolio companies, in a deal worth $80 million in cash and shares. The transaction will see ASEC Holding raise its stake in the company to 61.04 per cent. The selling party is the Emirates International Investment Company (EIIC), a long-time limited partner in a number of Citadel Capital’s Opportunity Specific Funds (OSFs) and a shareholder in the firm. “This transaction values ASEC Cement at EGP 14.68 per share against a par value of EGP 10, a fair
ASEC Cement factory
price for both parties that reflects its outstanding growth potential as it moves steadily toward controlling over 12 million tonnes of production capacity per year by 2013,” noted Citadel Capital Managing Director and Co-Founder Hisham ElKhazindar. As part of EIIC’s exit of ASEC Cement, Citadel Capital S.A.E. (CCAP. CA on the Egyptian Stock Exchange) will record revenues of $880,000 as a carried interest on the transaction. Citadel Capital earns revenues in three ways: Through capital gains on its principal investments; through management fees on the equity it has under control; and through a carried interest over a hard hurdle on capital gains it makes at exit for the limited partners in its OSFs. The deal will be partly financed
through the issue of ASEC Holding shares to EIIC in the amount of $ 32.5 million via a capital increase at a fair market value of EGP 28.50 per share. EIIC will continue to have exposure to ASEC Cement’s growth story through its stake with these shares. In addition to the capital increase, the Emirati firm recently acquired an additional six per cent of ASEC Holding from Citadel Capital. Together with EIIC’s original shareholding, the two transactions give the Emirati company a 13.6 per cent stake in ASEC Holding. ASEC Cement’s production assets are on track to span five countries from Algeria to Iraq-Kurdistan within the coming three years. “Our aim in building out ASEC Cement is to create one of the largest and most efficient independent c e m e n t producers in the Middle East and Africa,” notes ElKhazindar. “We are well on our way, and EIIC’s decision to reinvest a large portion of the proceeds from its exit of ASEC Cement into ASEC Holding through a capital increase is a testament to our limited partners’ belief in this goal.”
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Trust is the word
enTrust & Title is a neutral third party ensuring property transactions are hassle-free and in compliance with the law
By Vanit Sethi
lashback to the summer of 2007. It’s hot, happening and haphazard. Everyone’s making a killing in Dubai, buying and selling property. But where’s the property? It’s not even on paper - it’s just in the air. Or in colourful brochures and flyers with futuristic designs. Before even the blueprint is finalised and approved, the property is already sold twice over. And before the construction begins, it’s been flipped many times. But by the time maybe a genuine buyer has got the papers in hand towards the winter of 2008, the world economy has come crashing down like a pack of cards. And many so-called ‘fantastic properties’ disappeared in the Arabian sands without a trace. Those who had pooh-poohed any talk of a giant bubble building up were now waxing eloquent on the financial tsunami storming the world. Alas, it was too late for those who had already burnt their fingers badly and made a mess of their investments. A crisis does provide some lessons. And this was a catastrophe, so it should provide several books. New laws were written, existing ones strengthened, and legal bodies added more muscle. Things are seemingly back in order, thanks to the untiring efforts of government bodies like RERA to streamline all property transactions and provide a legal backbone to contractual agreements. Enter enTrust & Title into this new scheme of things to lend a helping hand to those seeking assurance that their money is in safe
the complicated technicalities of property transactions. For a reasonable fee, it lays to rest the fears of those investing huge amounts in a transaction whose legal requirements are unclear and incomprehensible. “If the parties are willing to pay huge amounts for legal services, then for a reasonable sum at our disposal, they can avoid costly litigation arising out of misunderstood contracts or those that do not conform to the new escrow regulations,” says Aziz Valliani, the suave CEO of the new company, a wholly owned subsidiary of UAE has one of the best escrow services in the world, the 23-year-old US says Aziz Valliani, the CEO of enTrust & Title company based in California. settlement services and ensures title legalities. With the backing of the Dubai Land Department and Cost-effective services RERA, the company offers tools In response to the challenges of the and services for buyers, sellers, real estate market, the company landlords, tenants, builders, agents provides deliberate transparency and brokers, ensuring compliance of all transactions it processes. The with escrow regulations. It helps issues of legal ownership, authority in the framing of contracts that to enter into contracts, registration comply with escrow rules, holds of deed, misrepresentation, financial cash deposits and cheques of the disclosures, and non-availability of buyer until they are ready for release documents in time for a resale or to the seller at the appropriate time, lease, are eliminated when using the offers advice to all interested parties company’s enTrusted Settlement at the time of signing contracts, Services. checks and ensures that contracts Its state-of-the-art technology are not one-sided, and simplifies enables digital biometric hands. Located in Dubai Internet City, enTrust & Title is essentially a neutral third party company that undertakes
authentication of all principals and eliminates any financial risks posed to the parties involved in a property transfer or rental transaction. It also offers a renewable assurance policy to ensure a proper and complete transfer of the title at the close of the transaction. The services comply with the government’s quest to bring transparency, accuracy, and efficacy to property transactions in order to ensure international confidence in Dubai’s real estate market. Most importantly, the company’s timing of entry into the Dubai property market is appropriate, coming at a time the emirate was looking out for a viable media that could build trust between different parties involved in a property transaction, and at the same time guarantee compliance with legal issues like the escrow law. When Aziz Valliani came to Dubai over three years ago, he felt the need for a company like this to bring order to the chaotic property jungle that Dubai was then. The world economic collapse came like a blessing in disguise for the Dubai property market, Valliani feels. “Of course, Dubai’s forward looking government has taken good care to see that now international best practices are adopted in the emirate, and a return to the earlier Wild West days is quite impossible,” he adds with a flourish. To buttress the fact, he points to a comparative chart of five countries, proving that the UAE has one of the best escrow and title conveyancing services, better than even UK and US. “And it will only get better.”
DUBAI REAL TIMES
Where have all the good developers gone?
Landmark Advisory Q110 Report: deficit of grade A developers in Dubai and Abu Dhabi
ebruary saw Landmark Advisory release its quarterly report which focused on the rating of the top developers in Dubai and Abu Dhabi; the quantitative evaluation carried out by a panel of industry revealed a deficit of Grade A developers in both cities. Low ranking developers will contribute to the ongoing price divergence within the asset classes in both markets. Ms. Jesse Downs, Director of Research & Advisory Services, Landmark Advisory, explains “To date, much of the supply already delivered was built by master developers, which rank higher. However, these developers constitute the minority of the total pipeline of units within the next several years. The singleasset developers currently building the bulk of the forthcoming supply have a significantly lower rank and may suffer further credit downgrades as their product is forecasted to overpromise and under deliver. This phenomenon will create a bifurcation, a dividing into two, between integrated, high-quality units and those poor quality units within fragmented communities where many builders have postponed their developments indefinitely.” The evaluation was based on three basic criteria: product quality, customer service, and overall perception. “Product quality refers to each individual developer’s track record and ability to deliver the product quality promised during
the marketing and primary market sale of the unit. In some cases, developers have not delivered any projects locally. In this case, they are graded based on the anticipated quality of their projects,” continued Ms. Downs. Turning to residential sale trends in Dubai, “While villa prices remain unchanged on average, there is a variance of pricing emerging based on location,” explained Ms. Downs. “Sale prices for villa communities along Sheikh Zayed Road – which we refer to broadly as coastal communities – have increased while inland communities have decreased. As indicated in the company’s latest findings, location and quality are driving apartment prices; while average prices decreased, select communities, including Palm Jumeirah and Downtown Burj Dubai, experienced slight increases.
According to Ms. Downs, residential leasing in Dubai has also regressed: “Average villa rents declined 2.2 per cent while average apartment rents declined 3.0 per cent. In select new residential areas, apartment rents have increased which is primarily due to all available residential units having been handed over recently. This type of marginal rent increase usually follows apartment deliveries, propelled by gradual occupancy gains after handover.” Landmark predict that rents are likely to keep declining throughout Q1 2010 as more supply is handed over and landlords become increasingly flexible: “We expect continued relocation from Abu Dhabi to Dubai, which will put further downward pressure on Abu Dhabi rents,” summarised Ms. Downs. In terms of commercial property,
leasing volumes for office space remained low in Dubai whereas they increased in the capital. “Office leasing transactions in Abu Dhabi have slightly increased during Q409 as more companies try to settle in the local market. This follows two consecutive quarters during Q2-Q309 during which the office market slowed considerably, particularly during the summer months,” explained Ms. Downs. “The rent levels for office space in Abu Dhabi are likely to keep declining as more supply is delivered and landlords become increasingly flexible in order to guarantee good occupancy rates,” continued Ms. Downs. “Quality and location will determine whether rents hold, and poor quality units in areas such as Tourist Club Area, Electra Street and the east side of Salam and Hamdan Street are likely to be the hardest hit.” In Dubai, commercial sales and lease rates declined. Analysts found that volumes have remained extremely low with existing sales activity primarily in Jumeirah Lakes Towers. “We expect pricing in both the residential and commercial real estate markets to bifurcate based on quality. This will become an increasingly critical factor in the local real estate markets,” concluded Ms. Downs.
DUBAI REAL TIMES
Size does matter
By Adrian Camps, appointed Chartered Surveyor for Fine and Country International
f you ordered a 12” pizza and it only measured 10” when it was delivered, you would probably be annoyed, but do nothing about it. However, when it comes to buying an off plan property of, say, 1,000 square feet and only receiving 700 square feet of floor area which you can furnish, most purchasers would rightly be very upset, especially when the price has been calculated on the whole floor area, even the parts that you cannot use. Most developers are committed to keeping customers happy, but occasionally there seems to be little justification for the difference between the floor area sold and that delivered, and some purchasers feel they have been unfairly treated. The root of the problem may lie in the differing methods of measurement that the authorities use in calculating the built up area (BUA) of a building and the permitted plot ratios. These differ between the authorities and have also changed over time. For example, a balcony enclosed on less than two sides is not usually counted as floor area for BUA calculations, whereas one that is enclosed on two sides does form part of the floor area. Corridors lift shafts and stairwells can also form part of these calculations.
So what can you do if you have 300 square feet of floor area less than what you paid for? Firstly, read your contract, it may well have a clause that refers to floor area discrepancies and have provisions for refunds and additional charges after threshold limits have been passed. However, this is not important, because this is now covered by Dubai law. The most important point is the method of measurement used in determined by the seller and no method of measurement is specified. There is no one method of measurement that is recognised by the UAE authorities, so where there is a dispute, the method of calculating the floor area is open for argument. Chartered Surveyors adopt the methods of measurement set out in the RICS code of Measuring Practice, which provide clear guidelines as to how each unit should be measured. The floor area adopted under this method will not include communal corridors, parking spaces or common staircases and often the floor area measured by this method will be less than the area quoted by the developer. If you feel unhappy with the floor area that you have received, Law 13 of 2008 will help you to some extent. It provides that if the unit turns out to be larger on completion the developer may not claim the difference in value, and if the unit turns out to be smaller then the developer must compensate the purchaser for the difference, unless it is marginal. The problem is that where there is a discrepancy, unless the method of measurement is clearly described in the contract, there will be an argument over what method to adopt. In the absence of any UAE standard you are advised to have your unit professionally measured by a Chartered Surveyor using the RICS code of measuring practice - and use this certificated area to discuss the issue with the developer.
determining the floor area. Some contracts describe carefully what is included in the floor area e.g. partition walls, external walls and balconies, etc. however, most do not. Often the final floor area of the unit is
DUBAI REAL TIMES
By Mohanad Alwadiya, Managing Director of Harbor Real Estate
o the question: “What will be the most prominent trends in Dubai’s real estate industry in the future?” I reply that short term investors and speculators were hit with the ‘perfect storm’ last year. Those who were taking the longer term view and had planned their cash flows accordingly have been able to weather the storm; those who were speculating, hoping to spin the property for a short term gain, got caught in the storm; while those that sold prior to mid 2008 left town unscathed. During the second half of 2009, the market witnessed the emergence of institutional and private investors that were focused on acquiring assets from distressed
sellers. We anticipate this trend to continue in 2010 and we also expect more end user demand will flow into the market once lending starts again. Another noticeable investment
focus that emerged during the second half of 2009 is the investment in income producing assets with the prime consideration being yield. In today’s environment to try and predict capital appreciation is very difficult and, while in the long term property bought today will certainly appreciate, the market is too volatile to start predicting capital appreciation rates. Overall, many buyers still believe that real estate is a lucrative investment option. People want to take the opportunity of owning their family home or take advantage of the investment opportunities that emerged in the market today. The demand is there, it just needs some liquidity to enable the conversion of intention into transaction.
What are the best properties for investment, selling, leasing? There now exists a greater range of choice and buyers can succeed in obtaining true value and quality in the property they seek to purchase. It is now that the fundamentals of purchasing or leasing real estate come to the fore; location, quality construction, infrastructure, return on investment and yield. The most sought after assets today are the yield producing assets as they offer investors an opportunity to enjoy annual yields that remain higher than the global average yields. The best assets to invest in are residential units within completed developments and established communities that offer its residents (owners and tenants) a rich lifestyle experience. In addition, the current attractive price points and the overall low supply of villas compared to apartments (estimated at 13 per cent of the total residential units), offers a safer and more robust investment opportunity for investors. When it comes to offices and retail, these two asset types were affected by the slowed commercial activity and the expected high supply. Hence this had a direct impact on the appetite of investors. Having said that, there are some fantastic investment opportunities in both asset types where some office or retail properties are rented by renowned brands with long term lease contracts which offer greater stability in terms of annual yields to investors. It is a known fact that companies do not relocate as often as residential tenants. Investment funds and bonds are always good options for investors that don’t have the time to manage their investment transaction
DUBAI REAL TIMES
Mirador villa at Arabian Ranches
Offices on Sheikh Zayed Road
process. But it is definitely an option for long term investors. What are the difficulties faced by the real estate industry? The industry is experiencing some serious growth pains but will recover. We believe we will see a much improved level of activity in the second quarter of 2010 as the world economy strengthens, credit becomes more accessible and Dubai re-launches itself as a preferred place to do commerce and trade. The launch of Burj Khalifa has helped strengthen Dubai’s global position as an innovative and leading destination and the media coverage it obtained definitely helped boost the awareness of Dubai. The recovery phase will need to be driven by fundamental and solid economic drivers, not speculation. Population growth, driven by an increase in commercial activity will be the primary determinant of a real estate recovery as Dubai attracts new business entities, investors and owner occupiers who have a long term outlook to their participation in Dubai’s economy. We believe that the market is currently going through a phase of positive stabilisation. The long anticipated recovery cannot be claimed as yet, despite indications that started during the third quarter of 2009 suggesting the market had bottomed, and early signs of
recovery will be evident in the next few quarters. Of course, there are fundamental economic issues to be addressed, some of which are central to hastening an overall economic recovery which, in turn, will aid the real estate recovery. The good news is that the Dubai and UAE government are already addressing these issues.
Signature villas on Palm Jumeirah
The issues can be summarized as follows: • Inevitable and unavoidable exposure to the rapidly deteriorating global economic condition • The inevitable downturn of domestic consumption and low confidence levels of investors • Scarcity of credit and funding sources for private and
institutional buyers The strength of the US dollar / Dirham and its effects on foreign investment • Corruption and transparency and its effect on investor confidence In our opinion, the biggest issue remains the lack of availability of credit. There are buyers who are willing to invest in their future, but the availability of funds is the major inhibitor.
DUBAI REAL TIMES
Victory Heights announces full electricity connection
o you remember the fuss that went on when villas on new projects such as Arabian Ranches were deemed fit to hand over to owners, who had been desperately waiting for their completion date promises to be kept, usually to no avail? Eventually, when money had been spent on renting and extending leases almost on a monthly basis, many owners decided to move
Yasser Al Raee
full electric power has now been installed to all villas and buildings the developers have confirmed. To date 385 villas have been handed over to homeowners, out of a total of 961-units. Already this year, handover has been completed in two of the seven villages that makeup the luxury villa community, with new residents moving in every day. “All homes and buildings in Victory Heights are now fully connected to Dubai’s main electricity supply. We have been working very hard with DEWA to ensure that connection and supply are in place and 100 per cent efficient for all our current and future residents,” said Yasser Al Raee General Manager at Victory Heights. Victory Heights surrounds the 18-hole The Els Club golf course, designed by World Champion golfer Ernie Els. Villas in the development are built in three different styles; authentic Spanish Andalusian, bold Mediterranean, and classic European styles.
into their completed homes in the middle of uncompleted surroundings. Electricity was provided by generators, often topped up by private purchases of these machines, and the only means of telephone communication was by a mobile phone. This is no longer to be the fate of residents at Victory Heights because
Integrated waste management
Dulsco has recently concluded an awareness exhibition at the Dulsco Events Arena showcasing its Waste Management Services’ (WMS) products and equipment, which was part of an initiative to enhance cross-selling across different business units. Attended
by the Chairman, Managing Director and representatives from each department, the awareness exhibition had presentations on the latest technologies and the safety mechanism adopted by the company, while there were also live demonstrations of various WMS equipments and products. The waste management products and services featured were collection and transportation of solid and liquid waste by various types of vehicles, waste collection receptacles and vehicles, waste compaction equipment, and recycling receptacles. There was also a special presentation about Dulsco’s on-shore and off-shore tank cleaning process, particularly for tanks used for petroleum products, chemical products, sewage, freshwater and sea water. Dulsco’s Waste Management Services, the first waste management firm in the UAE to be Integrated Management Systems certified, handles hazardous and non-hazardous solid waste in compliance with strict municipal and environmental provisions.
Empower and Swedish technology vendors
The Swedish Ambassador to the UAE, HE Bruno S Beijer, has said that the current situation offers tremendous
potential for developing business tie ups between Dubai based companies such as Empower and Swedish technology vendors. He said: “Empower played an instrumental role in Dubai’s transformation towards a more sustainable ‘green’ society. We firmly believe that there is an obvious potential for collaboration between it and the many Swedish companies which focus on Environmental Technology.” Bin Shafar said: “Empower always looks at solutions from world class companies and we believe that we need to have more joint ventures with top-notch organisations. Just a month ago, we inaugurated Empower-Logstor Insulated Pipes Systems (ELIPS), UAE’s largest preinsulated pipe manufacturing facility, in Jebel Ali.” He added: “We succeeded in building world class district cooling infrastructure that is considered an ideal economic and environmental solution for residential and commercial units, offices and hotels. In Dubai, residential units are becoming increasingly aware of the importance of using district cooling system as an alternative to conventional AC systems, leading to energy saving and environment conservation, as well as lower operations and maintenance costs. This is in sharp contrast to lower awareness of its importance in other parts of the Middle East.”
Ahmad Bin Shafar, CEO of Emirates Central Cooling Corporation (Empower) talks green energy with The Swedish Ambassador to the UAE, HE Bruno S Beijer Dulsco management at the Dulsco campaign
DUBAI REAL TIMES
DEWA signs six new contracts
New projects for conserving water and electricity agreed at WETEX 2010
n the second day of WETEX 2010 (Water Technologies, Energy and Environment Exhibition) Dubai Electricity and Water Authority (DEWA) celebrated the signing of six new contracts for projects in electricity and water sectors, enhancing the infrastructure of DEWA facilities and raising the efficiency of the networks to meet the growth in demand to services. HE Saeed Mohammed Al Tayer,
HE Saeed Mohammed Al Tayer
MD and CEO, DEWA, signed the contracts on behalf of DEWA and its partners, including contractors and senior officials in the companies which were awarded the contracts for execution of those projects. HE made it clear that the six contracts were for major projects to the amount of Dh3.130 billion covering both electricity and water sectors. The ceremonies for signing contracts started with the first contract, to supply, install, test and commission three 132/11 KV Substations with AAB Industries LLC -Dubai to the amount of Dh250
million. The second contract is with Areva T&D SA Dubai to supply, install, test and commissioning of three 132/11 KV Substations in various areas, including Dubai Investment Park, Jebel Ali Industries Area, Mutina, Kifaf and other places, at a cost of Dh1.030 billion. The third contract with Ducab Dubai to supply 11 KV XLPE power cables –800 kilometres, the value of which is Dh260 million. The Fourth contract to be entered with Ghantoot Gulf Contracting to supply, install, test and commissioning of Glass Reinforced Epoxy Water Transmission Pipelines and associated works at various locations (167 kilometres), with a total cost of Dh820 million. The Fifth contract is with M/S Saudi Modern Co. (Riyadh cables) Dubai to supply, install, test and commissioning of 132 KV cables to 132/11 KV Substations, to the value of Dh300 million. The sixth M/S Siemens to supply, install, test and commission Mamzer Beach 400/132 KV Substations, at Dh470 million. At the end of the celebration, HE Al Tayer emphasised the significance of completing these projects at the contractual dates in order to enter them in service in the right time. He assured guests that DEWA will extend all possible facilities to contractors to insure the proper completion of these projects, putting the environmental considerations that are set by DEWA at the top of its priorities. The same week saw DEWA launch its Green Building Regulations Stage II, jointly developed with Dubai Municipality, comprising of a new set of guidelines and
specifications, to regulate building standards for achieving efficiency in the use of electricity, water and renewable energy, as part of the ‘Green Buildings Project.’ HE Saeed Mohammed Al Tayer said: “The Authority plans to issue the Green Building power and water regulations in April, 2010, for ensuring the efficient use of electricity, water and renewable
energy in Dubai, within the green buildings framework. In the initial stage, all new buildings will be required to comply with the codes and regulations and incorporate them in their construction designs. Dubai will be the first city in the Middle East that officially applies the green buildings standards on its residential and commercial buildings.”
12th Water Technologies, Energy and Environment Exhibition (WETEX 2010)
Held from March 9 to 11, the show emphasised the importance of adopting best standards in conserving the environment as well as discussing latest techniques in energy sectors with specialised companies from around the globe. It stressed on the need to take serious steps to reduce emissions of greenhouse gases. It explained the importance of quick action to reduce emissions of carbon dioxide, which has increased by 40 per cent between 1990 to 2008. The show discussed the phenomenon of climate change and rising global temperatures, calling for the urgent need to develop a new framework to combat global warming. It also discussed ways of using ‘green’ technology to mitigate the impact of global warming. The number of ministries, municipalities, government departments and public service associations participating at the show exceeded expectations, with more than 490 companies, compared to 450 companies last year, representing establishment from 23 countries. WETEX not only represents technologies, but also adopts and supports the issues and topics in the field of sustainable development and conservation of the environment.
DUBAI REAL TIMES
Wanted: Project management expertise
Middle East construction sector to overtake Europe & North America
ore project management (PM) expertise is needed to sustain trilliondollar project-driven developments across the MENA region. The Middle East’s construction sector alone is expected to post an annual growth rate of 3.5 per cent over the next five years to place ahead of Europe and North America and third behind Asia. The Gulf, in particular, has around $1.35 trillion worth of active civil building projects requiring the latest PM technologies and techniques. Collaboration, Management and Control Solutions (CMCS), a Portfolio Project Management (PPM) firm in the Middle East, has launched an educational campaign to train businesses and individuals from across the region on advanced tools and skills to meet demand for world-class PM capabilities. The company is the first organisation to be authorised by Oracle University, the global educational arm of enterprise software company Oracle Corp., to deliver certified training programmes in the Middle East. “As one of the world’s most project-driven markets, the MENA region has to ensure that it has access to the best PM tools to maintain its competitive edge.
While PM methods are used to properly manage projects, PPM enables organisations to select the right projects, which is a very critical activity given today’s tight markets. We want to promote these two concepts so that the region can excel in both project selection and execution,” said Bassam Samman, CEO and Founder, CMCS. The company has been engaging in similar education-oriented initiatives, such as its recent signing of a Memorandum of Agreement with American University of Sharjah (AUS) to train AUS students and alumni on Primavera software and its applications. Collaboration, Management and Control Solutions has been connected with Oracle for more than 25 years.
Business Village for SMEs
Provides fully integrated services and solutions for entrepreneurs and existing small and medium Enterprises (SMEs)
The Mohammed Bin Rashid Establishment for SME Development (MBRE), one of the Department of Economic Development establishments, has said that more than 30 companies from the public and private sectors moved their operations to the premises of its pioneering project ‘The Business Village’, Deira. Launched in the summer of 2009, the village aims to provide support, guidance and all levels of facilitation to make it easy for businesses to start and grow. Among the first organisations that moved its operations here are Mohammed Bin Rashid Establishment for SME Development, and the German Emarati Joint Council for Industry and Commerce. The Village also hosts a wide range of general trading companies including Aswaaq LLC, Seureca Overseas, Green Inovacation LLC, Wall Green Trading, Scrapa Shoes Trading, Caliber ME, Raj Associate, Marzouq Cosmetics, Orasia General Trading, GTF General Trading, M2
Trading, and Bin Ghalita Trading. It is also home to a number of real estate and contracting companies including Speed Performance Building Contractors, Majesty Agriculture Investment and Union Square Real Estate. Services companies such as Appollo Flight Centre and Blue Water Tourism, Images Digital, Renaissance Translation & Business Services, New Generation Business Services, Abdul Rahman Naseer Advocates, and Moora Foods (Subway) are also housed here. In addition to the companies which have already moved in, a number of public and federal bodies are moving there soon, including the Dubai Department of Economic Development, UAE Ministry of Foreign Trade, Dubai Events and Promotions Establishment, Dubai Export Development Corporation, and Business Incubation Centre. The Business Village offers a comprehensive platform for trade, business and social activities. It
Bassam Samman Business Village in Deira
DUBAI REAL TIMES
extends on an area of one million square feet and includes commercial office space, business centre and conferences and meetings rooms. The project includes a mixed-use (not sector specific) business incubator, surrounded by commercial and business organisations that are directly engaged in supporting and providing services to foster entrepreneurship and SMEs.
poverty and addressing the various challenges of the developing world. He was appointed to the Cabinet as Secretary of State for Trade and Industry in 1998, where he was responsible for the introduction of the National Minimum Wage. He is honorary Chair of Policy Network, a European and international think tank.”
throughout the entire relocation process, is to thank for the positive results, master-developer Nakheel has said. The rocks, which cover
Touring the tower
The Rt Hon Lord Mandelson tours At the Top, Burj Khalifa The Right Honourable Lord Peter Mandelson, UK’s First Secretary of
Responding well to its new habitat are more than 5,500 tonnes of coral transported to the breakwaters of The World. A new method, which involves the size of a football pitch, were moved from Dubai Dry Docks to 27 kilometres of The World breakwaters and are now home to 18 species of coral and more than 30 species of fish as well as sea-squirts and urchins. Initial findings by Dr John Burt of the Natural Science and Public Health department at Zayed University showed that one year on, 93 per cent of the transported marine ecosystem is thriving. “A project on this scale has never before been attempted and I am delighted with the results we are seeing,” Burt said. “This marks an important step in our understanding of the methods of coral translocation.” The coral was relocated between April and June 2008. A total of 1,129
(From right to left): The Right Honourable Lord Peter Mandelson and Mr Abdulla Lahej, Executive Director, Dubai Project Management, Emaar Properties, tour At the Top, Burj Khalifa
rocks with an average weight of five tonnes were moved and now cover an area of 6,560 square metres. “The coral translocation area has attracted a number of species of reef fishes that are less common elsewhere in that area, including a number of commercially important species,” Burt said. The typical method of removing coral involves the use of crow bars, underwater drills and cranes. The developer’s environmental team developed the new technique, in which a bolt was drilled into each rock then attached to a sling to hoist the rocks to a depth of three metres below the water surface and attached to a transport barge. “The methods used are a world first, and one year on have been hailed by independent parties as a resounding success,” said Brendan Jack, head of sustainability and environment, Nakheel Northern Projects.
Piling and deep foundations
Region’s biggest Geotechnical summit gathers over 200 global experts
State, Secretary of State for Business, Innovation and Skills (BIS) and Lord President of the Council, toured At the Top, Burj Khalifa the world’s highest observatory deck with an outdoor terrace on Level 124 of Burj Khalifa, the world’s tallest building. He was accompanied on the tour by Mr Abdulla Lahej, Executive Director, Dubai Project Management, Emaar Properties, the developer of Burj Khalifa. The Rt. Hon. Lord Mandelson spent nearly 45 minutes At the Top, taking in the impressive views of Dubai from the towering heights. Mr Lahej explained: “The Rt. Hon. Lord Mandelson has been at the forefront of promoting global trade ties through multilateral partnerships in addition to being one of the ardent champions in fighting
(Left to right) Mohamed Al Bahri, Director, Zoning Authority Development Control, DTMFZA, Ali BuRuhaima, Deputy Director-General, DTMFZA, and Badr Al Gargawi, CEO, Tamdeen, during the official opening of the Piling and Deep Foundations Middle East 2010 Conference in Dubai
DUBAI REAL TIMES
The Dubai Technology and Media Free Zone Authority (DTMFZA) co-hosted the third Piling and Deep Foundations Middle East 2010 Conference to highlight the importance of utilising timely, costeffective and innovative foundation systems in major projects for ensuring satisfactory project deliverables. The region’s biggest geotechnical summit commenced on 31 January with a full-day master class at The Westin Dubai Mina Seyahi Beach Resort & Marina, organised in conjunction with Tamdeen, a specialist firm in technical project management and a member of TECOM Investments, Deep Foundations Institute (DFI), US, and the International Quality and Productivity Centre (IQPC). The twoday main event drew 200 global experts to Dubai. Ali BuRuhaima, Deputy DirectorGeneral, DTMFZA, said: “This international seminar brought together some of the world’s most prominent speakers from the geotechnical and structural engineering fields. Their discussions focused on challenging projects, new innovations, and the fostering of knowledge among professionals. This is part of our initiative to host events that will benefit the civil, and, more specifically, the geotechnical engineering communities in the UAE.” Mohamed Al Bahri, Director, Zoning Authority Development Control, DTMFZA, offered the opening remarks at the all-day pre-conference master class. Comprising morning plenary sessions with keynote lectures, the event included afternoon technical tracks with a choice of practitioner and academicians-led sessions or a segment on case history presentations. Some of the industry experts who took the podium on Day-2 include Professor Jean-Louis Briaud, Dr. S. K. Ghosh, member of the American Codes for Seismic Design, Salah Al Dilimi, Civil and Structural Technical Manager, Roads and
Transport Authority (RTA), Dubai, and Dr. Alaa Ashmawy, Dean, School of Engineering, American University in Dubai. All regional municipalities, ministry of public works, and other government departments had been specially invited to the international conference. Badr Al Gargawi, CEO, Tamdeen, said: “As co-hosts of the third Piling and Deep Foundations Middle East 2010 conference, Tamdeen aims to support the exchange of vital benchmarking methods among industry peers.” An international case study day marked the conclusion of the conference on the fourth day highlighting engineering feats accomplished by industry peers. The session saw worldrenowned consultants, contractors, academicians and practitioners getting together to brainstorm and identify best practices and recognise the innovations and achievements in the field. Tamdeen is currently implementing various projects including Dubai Biotechnology and Research Park (DuBiotech), Energy and Environment Park (Enpark). The company has also helped develop the infrastructure for other Tecom business parks including Dubai Studio City and Dubai Internet City.
full care of the construction sites in various areas of the emirate. The team conducted a survey and inspection before treating the construction sites. As a result of the search in a number of sites in 2009, the team issued 612 warnings and 460 fines,” she said. Al Sabbagh said that the municipality is formulating some legislation that would be binding for the contracts of construction companies, that they should treat the sites when they have a high degree of rodent infection so as to avoid the spread of pests to other areas. During the recent campaign, covering the first stage of the survey, which started on January 23, the areas of Al Barsha, Al Quoz, Mirdiff, Muhaisina-1, Mizhar, Al Nahda and Al Warqa-2 were covered. The campaign continued until midFebruary.
Logistics company opens Dubai office
After its first full year of operations, in which major strides were made in all
DM launches rodent control campaign in abandoned construction sites The Public Health Pest Control Section of Dubai Municipality recently launched a campaign to combat rodents in the abandoned homes and abandoned construction sites in the Emirate of Dubai. The campaign was held in coordination with the Building Inspection Section at Dubai Municipality for identifying sites. Zuhoor Hussein Al Sabbagh, Director of Public Health Services Department said that a special team was formed to combat rodents. “The team, which was given priority of tasks to address the sites, took
aspects of its business, Sharjah-based Momentum Logistics, a subsidiary of international port management company, Gulftainer, has continued its expansion with the opening of its first Dubai office. Situated in Dubai Cargo Village, Momentum’s Dubai office is intended to enhance and extend the service levels it offers to customers, and forms part of the company’s national
and global network development strategy – which will also see further offices opened throughout the UAE and GCC. Momentum’s impressive growth can be seen from the ranking of the company’s General Manager Matthew Derrick by a local logistics publication at number 22 on the ‘Middle East Power List’ – a detailed ranking of the region’s most influential executives/companies from the warehousing and transport sector. Speaking of the continued expansion, Derrick said, “Since its establishment, Momentum has looked to develop our regional and global network, while continuing to provide the highest standard of service to our customers. As a young company with big plans we are delighted that our development has been noted by industry experts, and with the opening of our new Dubai office – and more expansion to come in 2010 – we are continuing to grow the business for the benefit of our customers”. Since its inception in October 2008, the company has been focusing on growing and expanding its services. In addition to its new Dubai office, Momentum also recently announced the opening of a new office in Iraq, and freight forwarding is not the only business area it has been focusing on: Momentum has also been developing its transportation fleet of tractors and trailers, which has grown to be the one of the largest trucking operations in the region. The fleet comprises 122 tractors and over 240 trailers, including specialised low bed trailers and tipping chassis. The division has also relocated to new offices and opened a state-of-theart vehicle maintenance and repair facility within the SICD.
DUBAI REAL TIMES
Parks and ponds
Sheikh Hamdan Bin Mohammed opens new pond park at Al Barsha
unday March 7 saw His Highness Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of Dubai Executive Council launching the
the occasion of the 30th Plantation Week, including the opening of eight public parks. “Four of these parks are pond parks, a first-of-its-kind public parks, which Dubai Municipality has set up at Al Nahda, Al Barsha, Al Quoz and Al Qusais-3,” Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum launched the activities said Amiri, adding that of the 30th Plantation Week by opening the newly built Pond Park at Al Barsha the other four parks will be residential or neighbourhood parks. Two of these pond parks, Al Nahda and Al Quoz were inaugurated on the same day, Monday, by Lt. Col. Dhahi Khalfan Tamim, Chief of Dubai Police and Mohammed AbdulKarim Julfar, Assistant Director General of Dubai Municipality for Corporate Support Services respectively. Lt. Col. Dhahi Khalfan Tamim, said that the creation of parks in residential entertainment projects of technical excellence which has been carried out according to the global best practices in the establishment of public parks. He said the park is built at a cost of Dh22 million with a total area of about 5.25 hectares. “The large water area, i.e. the pond, has a total area of 84,150 square metres (4.8 hectares), which represents 33 per cent of the total area of the park,” confirmed AbdulKarim. Eng. Salah Amiri, Assistant Director General of Dubai Municipality for Environment and Public Health Services Sector said the Municipality had organised a series of exciting events on
neighbourhoods and managing them well lead to good aspects of social development such as bringing together family life, a sense of community and looking after your environment. “In this sense, projects like this undertaken by Dubai Municipality strengthen the security infrastructure of the Emirate of Dubai in all respects. Creation of public parks of this advanced level of design and implementation is one of the complementary and necessary elements to achieve the strategic objectives of Dubai Police,” said Tamim. He praised the approach taken by Dubai Municipality in the establishment of such extensive parks with all amenities, ponds, green spaces, walkways, pools and flowers of every colour. Brigadier Mohammad Saeed Al Marri, Deputy Director of Community Services Department, Dubai Police said his department has long been maintaining a close relationship
30th Plantation Week activities by opening the newly built Pond Park at Al Barsha. The opening ceremony was also attended by Sheikh Ahmed Bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airlines and President of Dubai Civil Aviation Authority, Lt. Col. Dhahi Khalfan Tamim, Chief of Dubai Police, Obeid Bin Essa Ahmed, CEO, Municipalities Affairs Office in the Ministry of Environment and Water, Eng. Hussain Nasser Lootah, Director-General of Dubai Municipality and many senior officials of Dubai Municipality and the UAE Municipalities Federation. Ahmed AbdulKarim, Director of Public Parks and Horticulture Department said the Barsha Pond Park is considered to be one of the
Lt. Col. Dhahi Khalfan Tamim after inaugurating Al Nahda Pond Park
DUBAI REAL TIMES
Al Nahda Pond Park
with the municipality parks in different areas of the emirate for its role in the implementation of police programmes to connect with the community and the dissemination of awareness and security programmes or community service. Ahmed AbdulKarim, Director of Public Parks and Horticulture Department said Al Nahda Pond Park is one of the most important theme parks built in the emirate of Dubai in the recent period. “The park is the first entertainment facility in Al Nahda area, which is the newest urban residential areas in the emirate of Dubai located near the border of the emirate of Sharjah. It was built at a cost of about Dh22 million with a total area of about 14.6 hectares. The pond stretches to 80,000 square metres, which represents 54.4 per cent of the total area of the park,” said AbdulKarim. He said the Al Quoz Pond Park is
Al Quoz Pond Park
characterised by a beautiful pond at an area of 45,000 square metres covering 35.4 per cent of the park, which has a total area of 127,000 square metres. It has been designed according to the best park systems and modern landscaping methods. On Tuesday, Al Qusais-3 Pond Park and New Garhoud Park were opened by Abdullah Rafea, Assistant Director General of Dubai Municipality for General Support Services Sector and Obaid Al Shamsi, Assistant Director General for International Affairs and Partnerships respectively. Wednesday saw the inauguration of Qusais Residential Park by
Essa Al Maidour, Assistant Director General of Dubai Municipality for Engineering and Planning Sector; and Al Wuheida School Park by Salem Bin Mesmar, Assistant
Director General for Health, Safety and Environment Monitoring Sector. The Al Qusais project involves many leisure facilities such as children’s play areas for different age groups, jogging track at a length of 322 metres, various courts at an area of 1,150 square metres, cafeteria and restrooms. Eng. Hussein Nasser Lootah, Director General of Dubai Municipality said: “The greening of the city and plantation is one of the elements of the emirate of Dubai and the beautiful appearance does not remain so without the attention and horticultural maintenance programmes plus integrated care for the city’s green spaces.” “Dubai Municipality strives to maintain and promote the
Essa Al Maidour during the opening of Al Qusais-2 Residential Park
DUBAI REAL TIMES
spreading of green areas in Dubai and the provision of resorts, public parks and recreational facilities with the best design specifications and operate them according to the best international practices to the needs and expectations of the society and in all areas of the Emirate of Dubai,” Lootah said. He recalled that in the production of saplings the Municipality has been able to develop the productivity of its nursery in recent years by adopting the best scientific methods in the field of plant augmentation through its nurseries at Garhoud, Nad Al Shiba, Mushrif, Al Safa, Al Mamzar, Sih Al Silm and Warsan with production of more than 33.8 million saplings in 2009. Lootah added that in the establishment of public parks and recreational facilities the Municipality has taken huge strides as there are now 42 parks that include big parks, neighbourhood parks and the parks in the middle of the city, 49 popular squares in addition to recreational beaches. “Dubai Municipality is keen to hold many events and recreational
and entertainment activities throughout the year, and in 2009, the six major parks in Dubai (Mushrif, Safa, Mamzar, Creek, Jumeirah Beach, Zabeel) managed to attract about 5.7 million visitors while the number of zoo visitors stood at 327,000. The parks and recreation sector witnessed considerable development over the past three years in terms of developing existing parks and upgrading their facilities and adding new facilities,” he said. Lootah stressed that as far as greening projects and tree planting and beautifying the streets, the city is taking huge steps consistent with the aspirations of the Municipality in
The newly opened Al Sufooh Park
this area. He said 25 to 35 such projects are implemented annually and landscaping designs that are used are compatible with the nature of these streets, as the streets in the markets differ in designs for residential streets the external roads that link the city to other cities. He continued: “We depend on plants produced in our nurseries since 1986, and tourists in Dubai can tell the difference between streets by the plants there as each street has a special design and special plants. For example, in some streets geometric shapes are used.” “The Horticulture Section
provided an automatic irrigation system suitable with a success rate of almost 100 per cent using treated wastewater,” said Lootah. “The Municipality has provided the opportunity to enter free of charge to all categories of residential community parks and public squares. It is also committed to the establishment of events and activities in these parks. The role of Dubai Municipality in the plantation, greening and landscaping of the parks of schools, colleges, mosques and government departments and diplomatic missions in Dubai cannot be ignored,” he concluded.
DUBAI REAL TIMES
Announcements and pronouncements
Contrary to popular opinions, freehold properties are still being offered for sale, albeit slightly different from the usual villas and homely apartments
ecently some hotel offerings were made to the public, of furnished, freehold, loft and duplex apartments plus a luxurious Private Residence Club to IFA Hotels & Resorts’ (IFA HR) Laguna Tower. Both products will be serviced and managed by the onsite Mövenpick Hotel & Residence Laguna Tower Dubai, making this a mixed-use development. Werner Burger, President and COO of IFA HR, said: “We saw an excellent opportunity to maximise Laguna Tower’s customer offering by applying our proven formula of mixed-use developments. Its prime location near the metro and in the heart of ‘New Dubai’ made it a natural choice to offer city-lovers a fullservice hotel, a variety of residence options, hotel condominium units and a private residence club, all under one roof. It has always been our goal to ensure our customers have a variety of investment, residential and lifestyle options available across our portfolio.” The 42-story Laguna Tower is situated at the apex of the Jumeirah Lakes Towers development. While the first eight floors of the building comprise a five-star hotel, the top floors now feature the loft and duplex apartments and the club.
Laguna Tower Lofts
The new one bedroom lofts and one- and three-bedroom duplex apartments, all equipped with a bespoke furniture package, not only offer contemporary living space, but are also designed to be effortless property investments. Investors choosing to rent their apartments on either a short or long-term basis can leave everything from marketing to maintenance in the capable and reputable hands of the onsite hotel operator. Additionally, owners and their guests have access to all of the hotel’s facilities enabling them to enjoy a five-star lifestyle.
Laguna Tower Private Residence Club
Each home in the Laguna Tower Private Residence Club offers owners a luxurious and convenient holiday home serviced by a five-star hotel operator. The beautifully appointed and furnished loft and duplex units are divided into saleable private residence clubs interests. These interests entitle owners to enjoy a minimum of 21 days per year at the Club, as well as unlimited use of additional time available. Piaras Moriarty, Vice President
Client Management with IFA HR, adds: “Private residence clubs are among the fastest growing sectors of the real estate and hospitality industries. With the introduction of the high-end Laguna Tower Private Residence Club, second home shoppers now have an alternative in which they buy only what they will use, while still investing in an appreciating asset. Of course, ultimately, what owners buy is a luxury holiday they can enjoy year after year.” Ownership in the Laguna Tower Private Residence Club includes a number of outstanding benefits ranging from a concierge who will handle dinner reservations or arrange for a private chef, to picking up groceries, providing room service, nightly turndown and maid’s service. Additionally, owners enjoy an array of quality food and beverage outlets within the hotel, just an elevator ride away. Also within the building and managed by the onsite hotel are a state-of-the-art fitness facility, spa, two swimming pools, 24-hour security and two levels of basement parking. Craig Smith, General Manager, Mövenpick Hotel & Residence Laguna Tower Dubai commented, “It’s the simple, yet important gestures that
make a private residence club feel like a second home. For instance, offering complimentary yearround storage, allows us to have favourite photographs, essential items and sports gear put in place at a moment’s notice.” If owners choose not to use all 21 of their entitled days in the Laguna Tower Private Residence Club, they may exchange their days for stays in luxurious properties around the world through the IFA Collection. Through its master affiliate agreement with The Registry Collection programme, the IFA Collection offers more than 160 exchange properties ranging from tropical island villas in Belize and Disney beach resorts in the US to white-washed mansions in Scotland and opulent country clubs in the Canary Islands. Burger concluded: “We recently launched private residence clubs in Pattaya, Phuket and Bangkok, enhancing the IFA Collection offering across Thailand. Moving forward, we see a great strategic opportunity to broaden the geographic reach of the IFA Collection through the continued development of private residence clubs across our resorts and properties around the world.”
DUBAI REAL TIMES
Contemporary wallpapers for inspiring décors
Award-winning Swedish wallpaper company brings its products to UAE
CO BoråsTapeter – the Swedish wallpaper and wall coverings company have launched their first Shop-inshop in the UAE at Danube, Dubai Festival Centre, where customers can virtually simulate wallpaper designs within the design centre, to help them create their perfect home or office interior. ECO offers young, trend-conscious designs that appeal to those with an eye for detail – whether it be for the home or the office. The full range includes exclusive flock wallpaper and bold wall murals, with the Eco range including award-winning designs, such as the Elle Decoration Design Award for ‘London’. Being stocked in the UAE are Line, Velvet, Feeling, Design 2 and Design 3 – as well as the Metallic collection, which is used to match the other collections. By contrast, BoråsTapeter offers classic, contemporary wallpapers for inspiring décors and is Sweden’s oldest and most popular best-selling brand of wall coverings. The brand continuously develops their designs to satisfy the market’s interest in designs, colours and textures and aims to be an inspiring role model in the wallpaper market. Being stocked in the UAE from the BoråsTapeter range are Artwork, Garden, Passion, New Classic and Plain Stripes. “We understand that there is a demand for a fresh design brand in the Middle East as the offerings here are extremely limited – in terms of accessibility and international design,” says Lars Narfeldt, agent and distributor for ECO BoråsTapeter. “Now you can buy this luxury Swedish
design brand in the UAE.”
Office designers of the future
The Office Exhibition, sponsored by Hewlett Packard, opened on a high in early February, with key features at the show, including The Future Office, The Office Awards and The Student Loft Competition proving to be a great success. The Future Office is a new feature to the show, and provides a visionary peak at what offices will look like in years to come. It is the result of a design collaboration between some of the leading companies in the region – Mazari Consultants, Frezza SpA, Quantum Glass, 3D Lux, BAAJE, In Out Space and Skad Media, in addition to Hewlett Packard who are providing state of the art technologies. Designed with optimum employee health, safety, motivation and productivity in mind, the futuristic design combines sleek desks with complementary laptops, unique glass panels which can switch from being transparent to opaque at the flick of a button, and energy-saving light panels. In addition, it uses creative ceiling materials, such as stretchable sheets incorporating sustainable low energy lighting and colour changing light, which improves
productivity. At the other end of the design spectrum, The Office Exhibition also supports tomorrow’s generation of design stars through the Student Loft Design Competition, sponsored by Frezza SpA. This competition provides a unique opportunity for students to get direct exposure to the industry, and teaches them how to create designs that not only look good, but which are feasible and can be reproduced. Students from four local Universities competed to design a meeting table or area, a workstation, a reception desk or an office lamp. Success went to the girls this year, who scooped all three awards: Farzaneh Eslami from American University of Dubai won an award for her ‘Armed’ lamp; Aahd Alanqar from Abu Dhabi University for her ‘The Strips’ reception desk; and Israa Mahmoud from Ajman University for her ‘Serenity’ workstation. Speaking about her award, Farzaneh Eslami, AUD, said, “I am
so surprised that I won, but delighted! This was a great experience for me, and was the first time I have really had to think about the practicalities of my designs. Winning has given me much more confidence, and I am sure that it will help me enormously in my future career.” The winners’ prize is a week long trip to Milan, Italy, where they will be able to visit the famous international design fair, as well as Frezza’s office in Venice where they will be able to get a real feel for how the company works. Sinead Bridgett, Show Director, The Office Exhibition, said, “The response to the Student Loft competition was great, and it was encouraging to see so many design students taking part with such enthusiasm. We know from previous winners that the award has helped them in their career by providing access and exposure to leading design companies, and I am confident that this years award winning students will go on to achieve great things.”
DUBAI REAL TIMES
By Linda Benbow
aving lived so long in Dubai I remember when it was just a few buildings and a lot of sand. The place has faced a reversal since then and the buildings that I first heard about, and then, secondly, saw being prepared for construction have risen fast, then slowly and now steadily. Yes, many of the projects are ‘on hold’ to be thought about at a later date; but it is nice to see the ones that I initially heard about with so much passion and gusto now rising taller and taller. The first office tower block with a funny name registers firmly in my brain. i-Rise tower was to be built on a corner site in Barsha I was informed in 2005, with a vague reference to ‘special’ internet capabilities. It turns out that the area was in the process of being turned into a Tecom free zone – an extension of Media City, I now know for certain. And the corner
plot faces the infamous traffic lights which every Greens resident, Salik dodger and early-morning traffic radio presenter knows. Realty Capital Middle East FZ LLC has completed the concrete casting of the 30th floor slab of its centerpiece i-Rise office tower project in TECOM site C. This marks an important milestone as one of the largest office tower developments in the region draws near to its completion date expected in November 2010. The tower is 36 floors high and contains corporate and executive offices as well as retail space on the ground floor with an approximate total builtup-area of 1.9 million square feet. The tower will have 19 high speed lifts, some call them elevators, and 2,300 parking spaces. All electromechanical works of i-Rise are now being completed through the lower levels up to 27th floor. The contractor has also started placing aluminum cladding on the
external facade up to the 25th floor. Fit-out works are also well in progress. Marwan Mansour, the CEO of Realty Capital, confirmed: “There has been a growing sense of excitement and pride as we draw nearer to the completion of i-Rise. We worked really hard with the contractors to ensure that the project stayed on track despite the challenges that have been experienced in recent times. When we started this project, we vowed to protect the interest of all investors and stakeholders.” I remember when the concept of Dubai Healthcare City (DHCC) was first aired to the public, who were not really interested at the time, as there was too much else going on, what with making profits flipping apartments and villas before they were even built (pay a Dh5,000 deposit to secure a plot, then sell within the year to someone on the waiting list, or someone who didn’t want to join a waiting list – before having to pay the first instalment. It was a good scheme, everyone did it. In USA there were even books written telling you how to flip, one of the ‘Dummies guide to …’ series). Nowadays DHCC, the world’s first healthcare free zone, is well understood and well revered with folks look forward to seeing more
famous brand-name hospitals from various countries setting up there. Moorfields Eye Hospital from the UK is there and so too is the Mayo Clinic (USA), Great Ormond Street Children’s Hospital (UK), the German Heart Centre, Dr. Sulaiman Al-Habib Dubai Properties Group has renewed its agreement with Al Basti & Muktha (ABM), a leading building and civil construction company in the UAE, to complete Al Khor Hotel and Residences here. The towering five-star development, located in the heart of DHCC Phase-l, has already achieved 60 per cent completion. The community will consist of two towers, a 34-floor hotel to include 444 rooms and a 43-floor apartment building with 405 serviced apartments. It will feature a podium with six restaurants, a spa, gym, swimming pools and other amenities and include a car park accommodating 1142 vehicles. Khalid Al Malik, Group CEO, Dubai Properties Group, said: “The five-star facility will service the Dubai Healthcare City communities including patients, relatives and tourists, along with our corporate clients.” It was a lovely sunny day, with no swell under the waves when a group of journalists were taken on a Nakheel boat trip to see the islands of The World, now that they were standing proud of the briny sea. One of the islands had already been sold to a private individual who had built his home there, and so, due to privacy agreements, the boat was not allowed to get too near the island. Visibly, nothing has changed much since that day more than five years ago, although famous people have visited them, walked
DUBAI REAL TIMES
Lighthouses at The Heart of Europe
The Heart of Europe is a six-island, 12-site luxury holiday development. Situated on the islands of Germany, Austria, Switzerland, The Netherlands, St Petersburg and Sweden, the first-class destination offers a resort and leisure experience. The company has partnered with some of Europe’s foremost architects and technology providers to give the resort its signature style of modern design infused with characteristics of the host countries. A celebration of the continent’s artistic and cultural treasures, each country captures a different facet of Europe’s unique character – music in Holland, innovation in Germany, style in Austria, wonder in Russia, tranquillity in Sweden and romance in Switzerland. When complete The Heart of Europe will house 75 private holiday homes, six apartment buildings, six hotels, six lighthouses and six floating palaces as well as a diverse range of retail, entertainment and F&B outlets.
Al Khor hotel & residences
on the islands and even played golf on them – on the few islands that haven’t been sold yet, that is. But there are plans for that to change because Kleindienst Group, the developer of The Heart of Europe project on some of these island have appointed Foundation Construction Group Limited (FCG), to begin construction this month.
A specialist foundation engineering contractor, FCG will begin work on Germany Island, the first of the six islands to be developed in the luxury holiday project which attracted worldwide attention when it was announced in December 2009. Construction will begin with soil testing followed by improvement of the in situ sand of the island, an
engineering procedure undertaken to prevent subsidence, increase the overall bearing capacity and ensure the future stability of the island. The soil improvement operation, called ‘vibro-compaction’, involves the use of electric depth vibrators that mechanically agitate and lock the sand particles together down to seabed level (a depth of 18 – 20 metres), to ensure that all construction on the island is stable and sound. The technique is recognized internationally and is a standard procedure in the densification of reclaimed land. “Vibro-compaction will enable the islands to meet or exceed the demands of static effects (bearing capacity or settlement) and
dynamic effects (liquefaction, in the unlikely case of an earthquake),” said Francisco Baez, Technical Manager at FCG. “This intensive process, once completed, will result in the increased stability of The Heart of Europe islands and their superior condition to naturally formed islands.” FCG aims to complete ground settlement works by May 2010 after which Kleindienst Group will commence building its 20 private holiday villas. The villas are scheduled for completion in 2011. Josef Kleindienst, Chief Executive of the Kleindienst Group said: “The Heart of Europe project is about to commence the most critical phase of ground works to ensure the lifetime stability of our islands. We are pleased to be working with a group of geotechnical engineers that have vast experience in stabilising the foundations of reclaimed land.” An international company with subsidiaries around the world, the FCG team has been involved in many similar projects. Major projects in the UAE include contracts for manmade islands for the Al Souwah and Eco islands in Abu Dhabi. Since The Heart of Europe launched in December Kleindienst Group has sold 11 villas on Germany Island.
DUBAI REAL TIMES
Almasah International Real Estate, a Dubai-based real estate company, has announced that construction work on its sold-out development, Sahara Living, is nearing completion, with handover by October, 2010 on track, as promised. Located in Dubai Industrial City, and spread across an area of 18,116 square metres, Sahara Living is a residential development consisting of 84 villas. “Sahara Living sold-out because of the great design, landscaping and community-feel,” said Chairman Abou Taleb Talebi. “We have an obligation to deliver to the investors that believed in this project, and we would never let them down.” Targeted towards middle-income investors and families, each of the three-bedroom villas here includes a small garden, with villa clusters grouped around community pools, BBQ areas and playgrounds, all surrounded by lush greenery. “The villas are spacious, and the development is designed to inspire a neighbourhood feeling, but I think it’s all the plants and trees and detail to landscaping that really sold the properties,” added Talebi. Reem Dubai Contracting was appointed main construction works and began building in April of 2009, steadily making progress, with little
interruption, despite many other projects halting in Dubai. When asked how the company was able to continue works, despite the troubles facing most developers in Dubai, Talebi explained: “Our projects are well-planned, and we have firm backing, otherwise we would not be here - we hope that the completion of our projects helps encourage more investments in Dubai, because we are confident in the vision of the city, and of the UAE as a whole.” Almasah presently has a total of 19 projects under construction including Chess Tower in Dubai Sports City, Nathalie Tower, Blue Moon Tower and Noah’s Arc Tower on Palm Jebel Ali, and 14 projects all located in Jumeirah Village South.
Dubai & Northern Emirates (BBG) began in February with a groundbreaking ceremony at the British Embassy. The British Consul General in Dubai, Guy Warrington, and the Chairman of the BBG, Mark Beer formally broke ground for the new building which will be located, as was the old building, in the Embassy complex in Bur Dubai. The purposebuilt premises will provide more office accommodation and modern facilities for the BBG’s executive team and administrative staff. Chairman and CEO of BBG, Mark Beer, said, “The new office will allow
us to continue our 23 year history of promoting business between the UK and Dubai & the Northern Emirates, and supporting the community. The BBG is the largest and most active business group in the Gulf region with a growing list of more than 1600 members and an increasingly busy calendar of activity. The new building will help to facilitate our growth and ensure that we can continue to expand our activities and support services.” More than 50 representatives from the BBG, Young Arab Leaders, the British Embassy and UK Trade & Investment were on hand for the ground-breaking. Construction and fit-out of the new building is expected to be completed in April 2011. Mr. Warrington said, “The British Embassy has housed the BBG for many years, and we look forward to the next era in its development. As the representative voice of British business, the BBG plays a vital role alongside the Embassy and the UK Trade & Investment office in promoting bilateral relations.” The ground-breaking coincided with a busy start to the year for the BBG. In recent weeks, the BBG had hosted Britain’s First Secretary of State, Lord Mandelson, and the Lord Mayor of the City of London, Alderman Nick Anstee, as well as holding a lunch forum in association with Young Arab Leaders and hearing from Andrew Mitchell MP, the Shadow Secretary of State for International Development.
(from left to right) Mark Beere, BBG Chairman and CEO; Guy Warrington, British Consul General and BBG Chairman; John Alford, MD JASAF & CONTECH
New premises to assist BBG to further support the business community Construction work on a new office building for the British Business Group,
DUBAI REAL TIMES
British Business Group breaks ground
Houses and homes
The number of homes and offices being built, painted, outfitted and handed over for occupation are increasing monthly
ebruary saw Nakheel announce that it has received handover of the sixth and final tower at Marina Residences, Palm Jumeirah, from Japanese
Managing Director, Nakheel Development Projects said: “We have been working closely with world leading contractors Shimizu Corporation during the past few years to deliver this exceptional
square feet of living space. The development is complemented by a number of townhouses which are located along the marina fronted promenade. Palm Jumeirah is now home to more than 12,000 residents, however the project is still ongoing and the next five to six years will see the island become one of the world’s premier resorts, offering a number of top-brand named hotels, including Atlantis which opened in September 2008, as well as a wealth of retail and leisure choices, offering luxury retail, dining and entertainment destination. Last month also saw Dubai Properties Group (DPG) commence the handover of Al Waha, an exclusive freehold community within Dubailand. Following the successful launch of the adjacent Layan community, DPG welcomed homeowners to this luxurious enclave of 260 villas featuring terracotta roofs, warm
colours and cobbled driveways surrounded by tranquil desert landscape. The community includes 80 ground level two bedroom villas from 1,785 square feet, 80 first floor villas from 1,829 square feet, 50 three bedroom villas from 3,483 square feet and 50 four bedroom villas from 3,992 square feet. Khalid Al Malik, Group CEO of Dubai Properties Group said: “Al Waha is an important addition to our residential portfolio as it demonstrates our commitment to delivering a diverse range of communities in Dubai. We are always striving to introduce new and innovative real estate options that address the current market demand and Al Waha Villas is designed to meet the needs of the modern family. In addition, the community’s unique and appealing Mediterranean architecture is changing the desert landscape.” Al Waha is situated close to both Emirates Road and Dubai Bypass, and within minutes of the retail and
Khalid Al Malik, Group CEO, DPG and Sahar Al Ansari, DPG Development Director, Al Waha
DUBAI REAL TIMES
contractor Shimizu Corporation. The phased handover of homes at Marina Residences, located at the tip of the island’s trunk, began late last year, with close to 100 families already taking occupancy. Marwan Al Qamzi, Group
development on Palm Jumeirah.” The waterfront development features six residential towers containing a mix of apartments and penthouses. The most luxurious penthouses are designed over four floors, providing more than 14,000
restaurant offerings at MotorCity, Sports City and Arabian Ranches. The exclusive gated community will feature round-the-clock security, a clubhouse and community centre, with lush landscaping that will complement the breathtaking colours of the Arabian Desert. An ideal community for families seeking a respite from the frenetic pace of the city. Burj Khalifa, is readying to welcome its first residents with the orientation programme for homeowners of Armani Residences, located on levels 9 to 16 of the tower, currently ongoing. The interiors of the world-class and firstof-its-kind Armani Residences is in the final stages, and finishing work of The Residences in Burj Khalifa is progressing at a fast pace. The hand-over of homes begins first with the Armani Residences comprising 144 private apartments personally designed by Giorgio Armani. This will be followed by the much-awaited Armani Hotel Dubai, which occupies the concourse to Level 8 and Levels 38 & 39. The Residences, comprising 900 apartments, and The Corporate Suites, a collection of highend offices, began handover to customers this month. The handover programme can take anywhere from two to six months. Armani Residences is developed through a collaboration of Emaar and Giorgio Armani S.p.A. Personally designed by fashion legend Giorgio Armani, the one- and two-bedroom suites are spacious, ranging from 100 to 200 square metres. The interiors of Burj Khalifa, including The Residences, are embellished by award-winning designer Ms Nada Andric of Chicago-based Skidmore, Owings & Merrill LLP (SOM), the architects of the tower. The design elements take cues from the region’s heritage and interpret it into spatial elements with traditional motifs and the right selection of materials. Apart from glass, stainless steel and polished dark stones, the interiors feature Silver Travertine flooring, Venetian stucco walls, handmade rugs, stone flooring and dark, intricate Brazilian Santos Rosewood.
Local and international art pieces that were specially commissioned for the corridor area of The Residences have also be integrated into the interiors. In keeping with the delivery and completion of all its projects in Dubai, and after the delivery of 104
World renowned designer Perla Litchi designed the interiors for the project, with Al Mazaya decorating each villa with stunning furnishings. Business Avenue is located at Jumeirah Lakes and consists of three commercial towers catering to the needs of the office sector. Two
as a long-term investment. It will be managed based on a lease system as one of the company’s profitable assets. The economic feasibility of both projects were thoroughly studied according to cash flow schedules, with the projects being developed
villas of The Villa project during the second half of 2009, Al Mazaya Holding is continuing with the construction and development works of the second phase of the project. The company’s strategy will also see the delivery of Al Mazaya Business Avenue in the third quarter of 2010. Located at Dubai Land, The Villa project is comprised of 520 residential villas with modern designs. The first phase of this project, which included 104 villas, has already been completed and delivered to owners, while construction and development of phase two, which includes 110 villas, has been completed. Delivery of these units to owners has already started, and the overall completion rate for the remaining 306 villas (phase three) currently amounts to 70 per cent. In addition, Al Mazaya has completed approximately 85 per cent of the construction works for Mazaya Business Avenue, with the completion of the interior also going according to plan. Al Mazaya plans to deliver the project, which consists of three towers with 44 floors each during the third quarter of 2010.
of Mazaya Business Avenue’s towers were sold in 2007, while the third tower will be kept by the company
through collected sale earnings, leaving out the need to use the company’s own resources.
DUBAI REAL TIMES
Canal Residence West promenade
Dubai Sports City has received a strong response from retailers, with six signed brands to open in its residential apartment buildings complex project, Canal Residence West, upon handover from September this year. Among the brands already confirmed to have leased space at Canal Residence West are Al Maya supermarket, Alpha Optical, Champions Cleaners, Al Shafar Pharmacy, Nutrition World, and Al Arrab Restaurant, with further commercial tenants to be confirmed shortly. “2010 is a year of deliveries and growth for Dubai Sports City, and with many elements coming online, the project is now a thriving community servicing local residents as well as visitors from surrounding areas. As a result, many retailers of all sizes are realising
this trend and now want to take space,” said Sam Sayadan, Retail Development Manager, Dubai Sports City. Canal Residence West’s studio, one, two, and three bedroom apartments will be joined by the
400 villa owners already living in Victory Heights, a gated golf course residential community. Global banks are now open for business at The Galleries at Downtown Jebel Ali, while the first cafes, restaurants and convenience
stores are getting ready to move in to the mixed-use community development by Limitless. Citibank is the second international bank to set up shop at The Galleries – a mix of A-grade offices, residential and retail space set in 20,000 square
DUBAI REAL TIMES
metres of landscaped grounds – with the opening of a service centre at the development. Citibank joins Standard Chartered, whose branch and corporate offices have been operational since July 2009. Blom Bank France also has premises fitted out and set to open in April. And as the banks settle down to business here, the project’s first cafes, restaurants and shops are preparing to move in, with global chain Subway, Arabic eatery Mushmaool, car rental firm Diamond Lease and convenience store Fresh Plus at fit out or design stage. Salah Ameen, Deputy Executive Director for Limitless in the Middle East, says: “The Galleries aims to be a walkable, environmentally-friendly, balanced place to live and work, with convenience, sustainability and social interaction at its heart. Already home to a long list of global companies who have set up offices here, it is now welcoming a growing number of food outlets and retailers offering everyday conveniences for existing and future tenants and visitors.” Mohamed Kamal, Managing Director of Wilshire Foods, the franchisee for Subway in the UAE, added: “The Galleries at Downtown Jebel Ali aims to be a holistic, sustainable and interactive community, and we are excited to be a part of it. We have signed a 10 year lease.” International firms with corporate offices here include Ericsson, Kraft Foods, L’Oreal, Permasteelisa Gartner and, most recently, US-based SPX. The Galleries comprises eight buildings, separated by a communal landscaped plaza housing a 300-seat amphitheatre and 105 square metre screen, which, when complete, will provide a focal point for cultural events and entertainment. A-grade office and retail space can be leased now, while residential accommodation is due to come on line later this year. Located on Sheikh Zayed Road, close to the Jebel Ali Free Zone, The Galleries will
be served by the Dubai Metro when the RTA opens its remaining Red Line stations. Damac Properties has announced the structural completion of its 8th project over the last one year with the final concrete pour on its Park Towers project at the Dubai International Financial Centre (DIFC). The 46-floor dual-tower development, designed by Gensler, is due to be handed over later this year. It being constructed by Sharpoorji Pallonji. Damac has also announced that it has handed over new construction contracts for developments in Business Bay, Reem Island and Egypt as part of its commitment to construction and delivery of its projects. Ziad El Chaar, General Manager of Damac Properties, added: “In recent months the construction staff here have been working at a rate of completing one floor every five days. So I would like to thank them for this tremendous team effort.” Park Towers will offer more than 500 apartments in a range of sizes. Thanks to its glazed finish, each apartment will offer stunning uninterrupted views of the growing and maturing DIFC landscape. External glass and aluminium cladding continues at pace and the building’s distinct blue double glazed finish is now clearly visible.
Arabian Aluminium – who also worked on the record breaking Burj Khalifa project, is carrying out the cladding at Park Towers. Mr Chaar added: “To reach the top floor of the building marks a significant stage in the entire construction and development process. We will now be working hard to continue with the same focused progress on the exterior finishing of the building while the MEP works and interior designs and specifications are finalised.” In addition to offering freehold residential units for both UAE nationals and expatriates, Park Towers will feature three levels of distinctive retail, seven levels of state-of-the-art offices. In addition it will have excellent connectivity with direct pedestrian access to the DIFC retail spine and financial centre and is within easy walking distance of the Metro stations - the main one of which has already started serving the area. Developers of Victory Heights will be handing over the community’s 400th villa this month, hitting an important milestone in the full delivery of the golfing residential development, which lies within the heart of Dubai Sports City. The 961unit luxury project is a joint venture between Dubai Sports City and the Bahraini investment bank Arcapita, and surrounds the award-winning
The Els Club golf course, designed by World Champion golfer Ernie Els. Already this year, 100 per cent of the villas in two of the development’s seven villages have been handed over to homeowners, who have praised the community for its green and peaceful surroundings, and location at the heart of the world’s first residential development dedicated to sports. “This is a key milestone in the full completion of Victory Heights, and shows that we are moving ahead with delivery on our villas, despite last year’s economic downturn,” said Talal Chihabi, Head or Sales, Marketing, PR, and Customer Relations at Victory Heights. “The community’s close proximity to the world-class sporting facilities of Dubai Sports City is also proving a big draw for people who enjoy leading an active lifestyle. There are jogging tracks around the development, as well as dedicated children’s play areas, and parks where we hold community events. Living here makes you feel as if you are a million miles away from the hustle and bustle of Dubai,” Chihabi added. Villas in the development are built in three different styles; authentic Spanish Andalusian, bold Mediterranean, and classic European styles, and cost between Dh800 and Dh1,300 per square foot to buy.
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Family fun at The Walk
ubai Properties Group delivered a wide range of family-focused entertainment and activities at The Walk at Jumeirah Beach Residence, as part of the 15th Dubai Shopping Festival (DSF), the annual retail and entertainment extravaganza. Families enjoyed a high-energy Fun Fair located adjacent to Sheraton Hotel featuring a thrilling selection of rides and amusements including a ferris wheel, roller coasters, bumper cars, and water rides. There were also strolling Raqsaat performers entertaining visitors with traditional international dances throughout the festival. The DTCM Heritage Village offered guests extraordinary insight into Emirati culture and heritage. An exhibition on the centuriesold art of falcon hunting, a pearl demonstration, horse riding, mock wedding ceremonies, plus arts and crafts and traditional bands were enjoyed by guests of all ages. In addition, Covent Garden Market will offer a European-style shopping experience with trendy clothes, dazzling jewellery, unique accessories, authentic decor, beautiful artworks, beauty products and toys. The Walk at JBR has quickly emerged as one of the most distinctive and popular entertainment and shopping destinations in the area. The unique 1.7 kilometre outdoor shopping boulevard has 305 shops situated on both the plaza and ground levels. DPG remains committed to delivering a host of family friendly events each year with activities throughout the month-long Festival, along with the DSF’s distinct bargains, raffles, sales promotions, concerts and performances
Raqsaat performers, featuring traditional dances from Lebanon, Spain, Palestine, Morocco, Turkey, and Hawaii Looking for a pearl in an oyster
Win a cuddly toy playing hoopla at the fun fair
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JBR’s Covent Garden
Dubai Properties Group hosted ‘Heritage Revisited’, an evening filled with traditional activities for Seniors from The Community Centre in Dubai and Sharjah. Held at the Heritage Village in The Walk at Jumeirah Beach Residence, senior citizens were entertained with a host of cultural activities including the Arabian horse show, Emirati wedding, traditional handicraft, dances and local cuisine. The traditional evening also gave them an opportunity to share their own memories of Dubai and to discuss their views on the vast changes and growth that they have witnessed.
DUBAI REAL TIMES
Charitable deeds I
t was a fun filled exhilarating Saturday at Safa Park for the children of Senses Special Needs Centre in Dubai as well as a team of volunteers from Al Mazaya tance and social cooperation as well as financial support. I’m sure that today was just as thrilling an experience for the company team as it was for students in the Centre. We hope
Al Mazaya Holding held a Flea Market in Safa Park for Senses Special Needs Centre
Holding when they participated in the Flea Market on 6 Feb as part of its corporate social responsibility programme. The initiative was organised by staff in the Dubai office that collected a variety of items from donors for this purpose. These were then sold to the general public with the proceeds from the day’s activity going towards the furnishing of a new residential centre which has been built to cope with the ever increasing number of students. The sale was attended by the students of the Centre along with their caregivers; a few of the students assisted with the stall whilst others played games with fellow park visitors. Jasim Al Ghanim, AVP of Marketing at Al Mazaya Holding, said, “This initiative was about sharing, accep-
that our efforts in this regard will encourage the public to engage in similar activities” The Senses Centre is a private, non-profit organisation located in Jumeirah that relies on donations from the public for its survival. It provides care and support for both residents and out-patients. It is supervised by a group of qualified staff, including doctors and paediatric specialists provid- Dr. Mohammed Al Zarouni and Ahmed Khoury with children from Rashid Paediatric Therapy Centre
ing physiotherapy, rehabilitation, occupational and speech therapy in addition to various educational and entertainment activities. Due to the increasing needs of the centre, Al Mazaya Holding plans to hold more fundraising events going forwards. Dubai Silicon Oasis recently hosted an event to launch ‘Dubai Passport’ within its premises. An initiative of Creative Zone in support of the Rashid Paediatric Therapy Centre, the passportlike booklet presents its holder with special offers and discounts in Dubai and other emirates at over 52 outlets comprising F&B, retail, entertainment and pharmacies. DSO will promote the passport among the companies and employees operating at the technol-
ogy park and the funds raised will contribute to the centre’s mission to provide high quality, integrated education services and therapies for children with special needs. The launch ceremony was held in the presence of Dr. Mohammed Al Zarouni, Vice-Chairman and CEO of Dubai Silicon Oasis Authority (DSOA), and Ahmad Hashim Khoury, founder of Rashid Paediatric Centre, as well as business partners and employees. Children from the Rashid Paediatric Therapy Centre entertained the audience with artistic performances. Commenting on this initiative, Dr. Zarouni said: “We are pleased to support the Rashid Paediatric Therapy Center whose noble mission extends to supporting the disabled. In contributing to this campaign, DSOA hopes to reach out to the children at this dedicated centre and assist them in receiving what is rightfully theirs in terms of education and therapy. We also encourage all organisations to initiate similar activities among their employees that will lead to the enhancement of the community as
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A wholly-owned entity of the a whole.” Help THE One give disadvanDr. Al Zarouni kicked off the cam- Government of Dubai, Dubai Silicon taged children hope by purchasing paign by buying the first Dubai Pass- Oasis is the state-of-the-art technol- Bobby Sager’s visually inspiring cofport himself. The event concluded ogy park that provides the right en- fee table book, featuring images with DSOA and the Rashid Paediatric abling environment for companies used by Sting during his 2007-2008 Therapy Center exchanging memen- looking to set up their regional head- Invisible Sun performances. The quarters and research and develop- Power of the Invisible Sun by entretos. Ahmad Hashim Khoury said: “We ment divisions in the Middle East preneur turned philanthropist Bobby and North Sager is a captivating pictorial collecare grateful to Africa re- tion of his encounters with children Dubai gion. in war-torn areas of the world such Silicon as Afghanistan, Rwanda, Pakistan, Oasis for Palestine, Sri Lanka, Kenya and Zimcoordinatbabwe. Taken over the past eight ing this years, Sager’s powerful photographs marketing depict refugees, orphans, child solc amp ai gn diers and just plain kids living with whose reconflict, disaster and displacement. turns will But more importantly, they artfully support the capture the transcendent spirit of Rashid Pedihope in each child’s eyes, revealatric Therapy ing joy, innocence Centre. This and strength. is especially The book, significant at which ina time when cludes several organia foresations have word by ceased their cormusician porate social acSting, aims tivities and charto inspire ity contributions.” action Dr. Zuhair and deliver Abdel Rahim hope. They Maimani, General Public’s Choice 2nd winner was Tani Rienben – Triumph TRA3 Manager for Creative Zone, said: “The Dubai Passport charity campaign aims to support important causes such as offering financial, emotional and social support to people with special needs. It also offers the tourism, entertainment and commercial sectors of Dubai to participate in this initiative by offering benefits to consumers through special discounts. In line with its dedication towards corporate social responsibility initiatives, DSOA has been actively supporting causes and organised diverse activities such as a health awareness campaign, blood donation drives, and seminar on H1N1. It also marks the World Environment Day with tree planting at DSO.
are available at two prices; one for a spectacular, large-format limited edition version and the other for the distribution edition, These collector’s items are so much more than your average coffee table books. All proceeds go towards the Hope is a Game-Changer Project, which delivers indestructible soccer balls to disadvantaged children. Each ball is a lasting symbol of hope, representing the human spirit’s ability to overcome suffering - the power of the invisible sun. As Bobby said to THE One’s CEO Thomas Lundgren the first time they met, “Be selfish, go help someone!” The book is exclusively available at THE One Theatres in Jumeirah and Mall of the Emirates in Dubai, Sahara Centre in Sharjah and Khalidiya in Abu Dhabi. Residents and visitors enjoyed a vehicular delight last month when Emaar Properties once again held its Downtown Dubai Classic Car Show with local owners driving and displaying their vintage vehicles in the sun. The show was put together by Emaar with the support of the Automobile & Touring Club of the United Arab Emirates, a member of the ‘Fédération Internationale des Véhicules Anciens’.
DUBAI REAL TIMES
Public’s Choice 3rd winner was Al Attar- Pontiac GTO
The four day event was adjudged and the winners were: 1. Pre World War I Mohamed Al Fahim; Morris Oxford 1914 2. UAE Award Ahmad Al Jarwan – Sharjah Musuem; 1931 Auburn Speedster 3. Dubai Award Tariq Al Gamzy; Triumph TR4A – Red 1967 4. Emaar Award Marzooq Al Mansoori; 1959 Chevrolet Impala 5. Heritage Arnd Springer; Volkswagen Samba 1966 6. Classic Truck Car Nasser Mohammad Al Mansouri; 1946 Chevrolet Pick Up 3100 7. Club Merit Rafiq Mahmood ; White Trans Am 8. Parade Car Luke Walker; London Taxi
9. Public’s Choice Marzooq Al Mansoori – • Chevrolet Impala 1959 • Tani Rienben – Triumph TRA3 • Al Attar - Pontiac GTO - The Judge 10. Pre World War II Khaled Baker; Rolls Royce Phantom 1934 11. Modern/Classic Car Hisham Al Rifai; Pontiac 1978 Trans An Gold Colour 12. American May Maqzoomi; Corvette Stingray 1962 13. European Car Ahmad Abdulrahman; Rolls Royce Chinese Eyes, Silver Coupe 1963 14. DDCCS 2010 – Best of Show Serge Lupa; Ferrari Dino 1970 246 GT
DUBAI REAL TIMES
(L-R): Marc Dardenne, Chief Executive Officer, Emaar Hospitality Group; Ahmad Al Matrooshi, Managing Director – UAE, Emaar Properties; Serge Lupa owner of Ferrari Dino 1970 246 GT which won the Downtown Dubai Classic Car Show – Best of Show award; Mohammed Ben Sulayem, Vice President of the Federation Internationale de l’Automobile FIA and President of ATCUAE and Horst Bruning, President, FIVA at the award ceremony of the Downtown Dubai Classic Car Show held at Emaar Boulevard.
Green design initiatives in ready-built campus
The British University in Dubai applies sustainable features in design at new Dubai International Academic City Campus
ffort is needed for the UAE to do their part in applying environmentally-conscious initiatives in design and construction, said a Professor at The British University in Dubai (BUiD), a research-based postgraduate university, following a recent conversion at their new campus. Located in phase three at Dubai International Academic City (LEED Silver certified) BUiD’s new building was provided as core and shell, allowing the school to fit the interior with its sustainable design plans for lighting, cooling, partitioning and flooring. The design for BUiD’s new campus was overseen by Professor Bassam AbuHijleh, the Atkins sponsored Head of Sustainable Design of the Built Environment who believes conscious changes to the design of an office or home can have a very positive impact for the environment. International consultants Atkins have been supporting BUiD over a number of years and additionally funds the position of the Atkins lecturer, Dr Abeer Shaheen AlJanahi, its specialist in architecture and urban design. “Our new campus only allowed us to make the necessary green changes to the interior of the building so we worked with what we had. But well thought changes go a long way, not just from an environmentally-conscious perspective, but also from a social and cost perspective,” Professor AbuHijleh said. BUiD has maximised the penetration of natural lighting within the building and used energy efficient lighting throughout the building
Professor Bassam AbuHijleh
improving the lighting quality, and reducing cooling-load and electricity, in comparison with the standard practice artificial lighting generally used throughout the UAE. To further reduce the cooling load, individual thermostats have been installed in all rooms within the BUiD campus, allowing staff to set the temperature control to their liking and to switch off the air conditioning when not in use. Thermal and sound insulation have also been applied to improve comfort, reduce energy use and reduce noise levels between offices and classrooms. BUiD used low VOC environmentally friendly flooring material throughout the building, which improves air quality and reduces volatile organic compounds (VOC), bad odours, dirt accumulation, and germ build-up. “With the right knowledge, minimal effort can do a lot towards
How Dubai Pearl achieved gold pre-certification
Dubai Pearl, the 20 million square feet integrated sustainable destina-
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providing a sustainable and green home or office environment that brings added benefits, such as lowered electricity and cooling charges,” added AbuHijleh. In addition to the environmentally-friendly implementations, BUiD also used lots of glass within the building design to give a greater feeling of space and inclusion, and created a dedicated student area to facilitate academic life for its students. The Sustainable Design of the Built Environment programme at BUiD also offers students a dedicated Atkins Digital Design Studio, equipped with the latest software and hardware to use for their projects.
tion, overlooking the Palm Jumeirah, has attained pre-certification from the US Green Building Council (USGBC) at the Gold level for Leadership in Energy and Environmental Design (LEED). This brings Dubai Pearl a step closer to setting a new precedent for sustainable urban communities in Dubai. Leed is the internationally recognised benchmark for the design, construction and operation of high performance green buildings across the real estate industry. Its five key principles of sustainable site development, water savings, energy efficiency, materials selection and indoor air quality, provide a suite of standards for environmentally sustainable construction practices. Complying with the guidelines of the rating system, Dubai Pearl will utilise environment-friendly technologies to conserve energy, recycle water and re-use assets. A ‘green’ environment will be created through the Leed compliant system which will reduce electricity, gas and water used by the community and help in the optimisation of air conditioning, light control and car park ventilation. Large-scale solar boosted hot water generation plant, high efficiency building façade, optimized ventilation system for one of the largest undercover car-parks in the world, extensive grey water collection and re-use, green roofs and heat recovery systems will be integrated into the development. Abdul Majeed Ismail Fahim, Chairman of Pearl Dubai FZ LLC said:
“Through sensitive and intelligent design, this sets new standards for environmental and lifestyle sustainability, without compromising the high standards of luxury that characterise Dubai as a destination. The project’s commercial success to date endorses our commitment to delivering a combination of sustainability and stakeholder value as we enter a new phase in Dubai’s development.” The development maintains a waste management plan to ensure that recycling of material is maximised and targets that encourage, minimise and avoid waste are identified. The project will also salvage non-hazardous construction and demobilise debris, while all demolition waste from the site clearing will be reused by Dubai Municipality for land development work. The Dubai Pearl master-plan, which combines four towers with classically inspired podium buildings set in a ‘walkable’ area, will incorporate recycling facilities for paper, glass and food-waste. While over 50 per cent of the site area will be public open space, almost 45 per cent of it will be landscaped. Dome International, a leading UAE-based environmental service provider, conducted an environment impact study for this development that has been designed with a focus on the future.
ling this issue and recently published forecasts of saving potentials. Hans Altmann, Techem’s Regional Manager for the MENA region, states that if a three-tiered approach is followed, energy savings of up to 25 per cent are possible. 1. Implementation of price adjustments “At first, the way tenants are charged in the UAE make them generous with their energy consumption. We have seen great moves from the UAE government toward boosting ‘slab’ energy tariffs, which puts households’ energy consumption on certain levels. This determines their energy consumption based on the specified level. However, there is room to optimise this system, whereby pricing for energy can be based on actual consumption, which in the longterm makes households more aware and create an incentive for the careful use of energy. This is especially important for air conditioning, the greatest energy devourer accounting for over 50 per cent of the UAE’s total energy consumption,” Hans Alt-
mann says. During the last year, energy consumption in the UAE rose by seven per cent and is expected to increase even further with the rapidly growing population, property projects and other business opportunities. 2. Introduction of energy-efficient standards and regulations for buildings The second energy-saving measure is the introduction of efficiency standards and regulations that would enforce developers to boost the implementation and production of more efficient systems, appliances and equipment. As Hans Altmann explains, “New environmental standards such as the Green Building Code and Estidama have always been on the top of the UAE’s agenda. There are bans for covering a facade for glass or aluminium skin buildings due to their thermally inefficient nature. The use of glazed facades in modern buildings has gained increased popularity, just drive along Skeikh Zayed Road, and you will see that it does have the in-
Energy usage in the spotlight
Rising demand, rising concerns, three practical solutions As population growth accelerates, particularly in developing countries across the GCC, the region is consuming energy at an unprecedented rate. According to the United Nations, by late 2008 the GCC’s population growth had reached 4.77 per cent. Likewise, on the business side, the region is struggling to build power generation capacity fast enough to meet growth in demand. Energy requirements are expected to reach shocking levels rising 50 per cent of GCC’s electricity usage over the next years. Leading global energy services provider Techem has addressed ways and practical solutions of tack-
tended effect: It looks better, has a more pleasant interior environment and the building’s prestige is higher. Yet, we should introduce norms that do not sacrifice on the customer’s comfort and design interest, and at the same time, minimises the negative environmental impact.” This suggestion is in line with development plans and projects of the UAE, with an increased trend in Abu Dhabi, with the aim to improve ecological performance of buildings as the main concerns of sustainable and low energy building practices. 3. Implementation of rules and regulations to reduce energy consumption The third aspect, Hans Altmann points out, is the implementation of rules and regulations to reduce energy consumption. There should be incentives for tenants to save energy and increase their level of awareness. “This is a common practice around the world and from our experience the consumption-based energy cost allocation method enables tenants to pay for the energy they consume
DUBAI REAL TIMES
and get rewarded for that,” he explained. Techem has successfully experienced in many European countries that the customer’s learning curve realised energy savings of up to 40 per cent. This practice is of utmost importance for this region, where air conditioning is the major energy devourer, so that tenants are more likely to change their heavy energy use pattern as regulations for a fair pay-for-use model reward the cautious consumer by paying less. All in all, it is clear that there is room for improvement for tenants in terms of a more energy-conscious behaviour. Applying already established standards and systems such as Techem’s solutions based on its long-term success and experience implies that the wheel does not need to be reinvented. Applying a hybrid set of steps would have a significant impact on a practical basis, not just theoretical; a mix of adjusting prices for energy, along with energy-efficient standards and regulations for buildings culminated in the introduction of rules and regulations for tenants. As a result, the energy shortage that the GCC is currently facing – clearly exemplified by the blackouts in Sharjah during the summer with an expected scope at a larger level for this year - would be addressed. Techem elaborated on these practical solutions in detail at their hosted seminar on ‘Reducing energy costs of your property up to 25 per cent’ in February.
and provide more landscaping. Its aim is to add to the current six major parks and 76 residential ones spread throughout different areas of the Emirate and provide every person living in Dubai an equivalent of 25 square metres of green space each by 2020 where currently this space is 13.18 square metres. Mohammed Hassan Al Fardan, Head of Promotion and Recreation Office Public Parks and Horticulture Department, Dubai Municipality, said: “Our surroundings are highly important for all of us and make Dubai an attractive and pleasant city in which to live - for this reason we are pushing ahead with our extensive plans. Until now we have only used locally produced plants and flowers, cultivated in our own greenhouses, to develop Dubai’s green spaces. However, we have ambitious ideas and there is now a need for a greater variety of plant and flower species.” “This is why the Dubai Municipality supported IPM DUBAI 2010. This horticultural industry event was a perfect platform for us to meet in-
dustry leaders, review new products and adopt new technologies to help us in our upcoming ‘beautification’ projects,” he added. Mona Dada, Project Manager, planetfair LLC, said: “Now in its fifth year, IPM DUBAI has become a benchmark event for the horticultural industry and is staged in Dubai because of its world-leading infrastructure as a transport hub. IPM has grown in importance every year and is an opportunity for professionals to demonstrate technology, meet, discuss new plans and strike deals.” Visitor footfall at this year’s IPM exceeded 3,000 over the three days, as it is clear that the demand for flowers and plants and their related products and services remains strong despite the global financial conditions,” she added. Running from March 8-10 at Airport Expo Dubai, IPM DUBAI, featured more than 160 international exhibitors from 20 countries from the fields of flowers, plants, technology, floristry, sales promotion, plant maintenance and plants logistics. Trade visitors included plant pro-
ducers and breeders, seed traders, landscape gardeners, retail centres and wholesalers, real estate developers, local government and the hospitality industry. Visitors arrived from the GCC, Levant, Kenya, South Africa and Asia. The show included participation from leading companies in the UAE such as Alissar T&C, Al Lokrit, Arabian Agriculture, Mirak Agriculture, Gover Horticulture and others. Seminars and live demonstrations were held every day and the Association of German Florists (FDF) presented internationally acclaimed floristry design. The latest technology and techniques in landscaping, irrigation, plant protection and seed plantation were on display, along with floristry accessories and sales promotion items. With a common goal to promote Dubai as the hub for horticultural trade, the exhibition was supported by Dubai Airports, Dubai Flower Centre, Dubai MunicipalityPublic Parks & Horticulture and the Ministry of Environment & Water.
Planting of 27 million plants last year
Each person living in Dubai to have 25 square metres of green space each by 2020 Twenty seven million flowering plants were planted throughout Dubai in 2009 meaning the Emirate is getting greener every year according to Dubai Municipality just before before the start of IPM DUBAI 2010, the Middle East’s only event dedicated to the horticultural industry. Dubai Municipality has also confirmed its plans for 2010 and 2011 to increase green areas in Dubai by four per cent per year, open new parks
DUBAI REAL TIMES
Tendering tips and traps
By Al Tamimi & Co
his article will touch on some of the fundamental legal aspects of the tendering process relating to construction and engineering projects and offer some guidance on how best to avoid problems during this crucial stage of contract formation. Tendering for large and complex construction or engineering projects can be a very expensive exercise for employers and tenderers alike. However, it would be money well spent if the objectives of tendering were achieved. Most industry players will agree that the main objectives of tendering is two fold: firstly, the tendering process enables the employer to secure a suitable contractor to carry out the intended works at a competitive price; secondly, the process provides a level platform for participating tenderers to understand the requirements of the works and the various risks involved in carrying them out before deciding on their bid price. In a heated construction market such as Dubai was recently, parties do not often appreciate the legal aspects of the tendering process. During the previous frenzied
market conditions, stakeholders of the construction industry were too engrossed in negotiating and closing deals as quickly as they could after the tender closing dates. From our experience there have been instances where parties have compromised on the legal issues during the tender process for fear of missing the set milestones of a particular project.
The tender process
The tendering process in the construction and engineering industry has developed into a very comprehensive and complex procurement process. It often involves many steps and procedures which tenderers must undertake and numerous conditions that must be satisfied before they are eligible to move to the next stage of the process. The following provides the different phases of a tendering process. These phases were extracted from a guideline prepared by the International Federation of Consulting Engineers (FIDIC) (see The FIDIC Contracts Guide First Edition 2000). This outline of phases also illustrates a typical tendering process for a construction project in the UAE:
• Pre-qualification phase At this phase the employer will set its selection criteria (for example, contractors who are experienced in a specific type of engineering works) and invites prospective tenderers who satisfy the said criteria to submit their details and capabilities. The objective of this phase is to enable the employer to select suitable contractors to proceed to the next phase. • The tender invitation phase The employer issues an invitation to the shortlisted contractors (those who were selected from the prequalification phase) or to the public at large (if no pre-qualification phase was carried out) to participate in the tender process. • The tender clarifications and addenda phase During this phase, each of the tenderers is expected to raise any queries in relation to the tender documents or the requirements of the employer to enable them to price their offer or bid. In response, the employer will issue written clarification to the queries. The employer may also issue tender
addendums amending any part of the tender documents. Tender site visits are usually carried out during this phase. • The tender offer or bid submission phase Tenderers submit their offers or bids before the stipulated deadline along with the required tender security. • The tender opening and post tender clarification phase The employer opens and evaluates the offers or bids and seeks clarifications from the tenderers regarding their offers or bids (if necessary). • The award phase The employer issues a letter of acceptance to the successful tenderer. • The formalisation of contract phase The successful tenderer signs a formal agreement with the employer for the execution of the project. With regards to public procurement in the UAE, there are laws which govern public procurement processes. In the Emirate of Dubai, Law No.6 of
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1997 regulates contracts with the government departments of Dubai. Law No.6 sets out the various methods of procuring contractors by the Government of Dubai which include public and closed tender processes. This law also prescribes the procedures by which tenders are to be conducted. The prescribed tender procedures are generally in accord with the phases set out above.
The two-stage contract
From a legal perspective, an invitation to tender or a request for tender (RFT) document should be framed in such a way that it does not create any legal relationship between the invitor (the employer) and any prospective tenderers at large. Unless and until the prospective tenderers have participated in the tender process, there should not be any legal relationship between the invitor and each of the prospective tenderers. The common understanding is that a contract will come into existence if and when the invitor or the employer issues a letter of acceptance or letter of award in response to the tender. However due to the complexity of the construction tender process, each of the parties participating in the process, including the invitor, will be bound by a set of obligations throughout the process. The fact that tenderers are required to furnish tender securities or tender bonds is an indication that there is a contract in place. The typical tendering process for a construction or engineering project is in effect, from a legal perspective, a twostage contract.
contract or the ‘tendering contract’. The underlying obligation of the employer under this contract is its promise to consider each of the bids that the tenderers submit in accordance with the terms of the tender invitation. In consideration of the employer’s promise, each tenderer will deploy its resource to participate in the tender process and in turn promises to execute the project in accordance with its bid should the employer accepts it. Therefore, it can be argued that individual tendering contract commences when each tenderer begins to participate in the tender process. It is common industry practice for employers to include in the tender invitation a document usually labelled as the ‘Instructions to Tenderers’ or the ‘Conditions of Tendering’. These documents will set out the obligations of the parties during the tender process for a fixed period of time or until a specified event occurs (the conditions of tendering). It is crucial for all parties to understand and appreciate their obligations during the tender process. Depending on the terms of the conditions of tendering, a tenderer may be disqualified from the tender process if it fails to comply with the conditions. On the other hand any breach on the part of the employer may entitle the aggrieved tenderer to recover damages. Therefore, it is not surprising to find in the conditions of tendering a host of rights that favour the employers. Some of these rights are discussed below.
Employers’ overriding rights
As mentioned earlier, it is the promise of the employers that they will evaluate and consider the individual bid submitted by each of the tenderers. Therefore in the absence of any express terms to the contrary the employers are obliged to evaluate the bids and award the project to the successful tenderers. Otherwise, the employers may be liable to the tenderers for the wasted
The first stage contract
The first stage begins when the employer issues an invitation to tender or RFT. By issuing the invitation, the employer is making an offer to each of the prospective tenderers to enter into the first stage
costs and expenses incurred in participating in the tender process. However, it is not uncommon to find a term in the conditions of tendering which provides that the employer will not be bound to accept the lowest priced bid. Given the current economic climate, employers may also include in the conditions of tendering an absolute right for them to suspend or cancel the tender process at any time. With such discretionary rights, the employers would be able to reconsider the timing or feasibility of their projects should they need more time to secure the necessary funding, or if the market turns for the worse. Other additional rights that employers might set out in the conditions of tendering include the right to vary the procedure and timing of the tender process and the right to waive any irregularity in the bids. At times, these rights seem to have gone beyond what is necessary and reasonable at the expense of transparency and fairness to the tenderers. Ultimately, employers need to be mindful of the overriding requirements of good faith under UAE law whenever they exercise their rights pursuant to the conditions of tendering. They must bear in mind that one of the main objectives of tendering is to provide an equal platform for all tenderers to compete fairly. In this context, all tenderers must be treated equally and fairly by the employer throughout the tender process. For example, each of the tenderers should be given the same information and clarification within the same time as any other tenderers during the process. Otherwise the tender process may be seen as a sham and the eventual exercise of the employer’s right in turning down unsuccessful bids could be construed as an exercise of bad faith. To avoid any allegation of unfairness and bad faith, employers, (including their consultants especially those who are responsible for conducting the tender process), must ensure that each of the tenderers receives equal treatment and opportunity as any other tenderer. If there is any additional information
In most conditions of tendering there are different types of disclaimers that protect the employers. Employers
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which has arisen either in response to a query of one of the tenderers or late information that has not been included in the tender invitation, then the employer must ensure that such information is disseminated to all tenderers in a timely manner (unless the information is only relevant to a specific tenderer who needs it in order to be able to submit an alternative offer as allowed under the conditions of tendering). The procedure for disseminating information to all tenderers is often set out in the conditions of tendering and is usually done by way of conducting site visits, convening tender clarification meetings and issuing various tender documents such as addendums, clarifications and a collection of questions and answers. In the context of disseminating information, we consider that the practice of interactive tendering should be encouraged, whereby interactive sessions are built into the tender process giving each of the tenderers the opportunity to discuss and clarify the requirements of the employers and perhaps to further develop the specifications or project brief contained in the tender documents. Such sessions can also be implemented after the tender closing date as long as each of the tenderers is given an equal opportunity to revise its offer or bid after taking into consideration any information arising from these sessions. Whilst the interactive sessions must be conducted in strict confidence in order to protect the know-how of the tenderers, transparency and fairness must prevail such that any material information or errors discovered during the sessions are shared amongst the tenderers by way of issuing further tender clarifications or addenda. Careful planning and staging of such sessions will promote a truly competitive and effective tendering process.
will usually disclaim any responsibilities for the accuracy or correctness of information provided in tender documents. Depending on the time and budget constraints of the particular employer and the scope and nature of the intended works, it is always advisable for employers to include in their tender document the amount and details of information that are reasonably sufficient for tenderers to appreciate the risks that they will be undertaking if they are successful. This will certainly promote and encourage tenderers to put in their most competitive prices. Conversely, if the tenderers are to carry the burden of making their own investigations and enquiries as to the accuracy and correctness of the information contained in the tender documents, then subject to the risk appetite of the individual tenderer, most tenderers would likely add on a premium to their bid or offer prices to cover the risks of any inaccurate or incorrect tender information along with other associated risks. It is also a common requirement for tenderers to assume the risks of any misinterpretation, error or mistake on their part in construing the information given in the tender documents and in pricing their bids. In this respect, it is highly advisable for tenderers to ensure that they clearly and accurately record the assumptions and interpretations that they have adopted in pricing or formulating their bids. These assumptions and interpretations should then be discussed with the employer during tender clarification meetings. If the employer finds it necessary, the appropriate addendum or clarification may be issued to all tenderers in order to remove or minimise any ambiguity in the tender documents.
obligations on their part to proceed with the construction contract if they do not agree with the new terms introduced in the employer’s letter of acceptance. In this situation they must refrain from conducting or acting in such a way as if a contract has been formed otherwise they may be deemed to have accepted the new terms.
As highlighted above, it is very important for parties to be aware of their respective legal obligations during the tender process. Any inadvertent default on their part may give the other party the right to claim compensation. To take an extreme view, a defaulting employer may be liable to a disgruntled tenderer for the loss of chance of profits that the tenderer may have earned but for the employer’s breach of its tender obligations. On the other hand, a tenderer who refuses to be bound by its bid may be liable to the employer for the difference between its tender price and the higher contract price of another tenderer who the employer eventually engages. Therefore the stakes are high for both the employers and the tenderers if they choose to ignore the legal aspects of the tendering process. As the global financial crisis grips hold of the UAE construction market, parties should take the opportunity to revisit their practices either in their implementation of the tender process or in their respond to tender invitations. Even though it seems that the construction market in the UAE is currently in a depressed stage, it is certainly an opportune time for employers to capitalise on the lower construction costs and for infrastructure projects to catchup with the building industry.
The second stage contract
The second stage sets in when the employer, after due consideration of the tender bids, issues its acceptance of the successful bid. Depending on the conditions of tendering, it is usually upon the issuance of the said acceptance that a construction contract between the employer and the successful tenderer is created. The conditions of tendering would usually specify the event upon which the second stage contract, i.e. the construction contract is deemed to have come into existence. For example, it may be provided that the construction contract will be deemed to have commenced on the day the successful tenderer receives the employer’s letter of acceptance. And it is usually provided that until a formal agreement is executed between the parties the letter of acceptance shall form a binding contract between them. However, for the employer’s acceptance to be binding on the successful tenderer, the terms of the acceptance must in substance
correspond with the essential terms of the tenderer’s bid. Otherwise there cannot be a meeting of minds between the employer and the tenderer in order to form a contract. What could be an essential term to a contract is dependent on the nature of the transaction itself. In relation to construction contracts, the contract price and time for completion would be two obvious terms that are essential to the transaction. A letter of acceptance that does not correspond with the successful tenderer’s offer will amount to a counter-offer. The tenderer would then be in the position to either accept or reject the employer’s acceptance. However, before the tenderer rejects the employer’s purported acceptance it must be careful in determining whether the employer’s terms of acceptance are, in substance, different from its own offer or bid, otherwise the employer may encash the tender security or bond on the basis that the tenderer has failed to comply with its obligation under the tendering contract. The tenderers also need to be aware that there would be no
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The era of equity
By Shahram Safai
he economic meltdown is a global phenomenon which has had a knock-on effect on the Dubai property market. This article will consider how external equity investment can be a viable source of finance for property developers as an alternative to bank debt financing and in the absence of unit purchaser payments. The global recession has resulted in reluctance by unit purchasers to make timely payments to developers. It has also resulted in reluctance by banks to make available debt financing to developers. As an alternative, equity financing provides investment funds to a developer in exchange for a share of the development company. Equity financing is attractive for developers because no interest expense is incurred on funds invested and investor influence over the business can be curtailed. Generally, an investor obtains returns on an equity investment through dividends which are payments made out of the company’s profits. However, in this way, a developer also gains access to much needed capital from the investor with no immediate commitment to provide returns until the company is profitable. But an investor also gains in such scenario as the investor has made an equity investment in the development company at a rock bottom valuation given the economic cycle: he stands to benefit from significant capital gains as the economy improves and the valuation of the development company increases. Technically, there are a variety of
ways that developers can raise equity capital, each having its disadvantages and advantages. Developers may issue ordinary shares to investors in return for invested equity funds. Dividends are distributed only if the company is profitable and when the directors so choose. A potential pitfall of this approach is caused by a shareholders’ right to participate in voting. An investor who purchases more than 50 per cent of the shares of the development company will generally be able to control dividend declaration, allotment of shares, and appointment and removal of directors, (and thus control of the board). In such scenario, if developers issue ordinary shares they should strive to retain more than 50 per cent of the shares in order to retain control. To avoid some of the drawbacks associated with issuing ordinary shares, developers may consider issuing non-voting shares with the contractual right to a dividend of a fixed percentage in priority over other shareholders. Since the shares carry non-voting rights, investors cannot influence the running of the company. However, developers could issue such preference shares with the right to appoint board members thus granting a certain level of minority board control to such investors. Another option that a developer may consider is convertible debt, which is a compromise between debt and equity financing. An investor’s loan to a developer may be structured such that at the discretion
of the investor or at the occurrence of a predetermined event, such loan is convertible into shares. The rights and obligations of the investor and the developer, as well as the rights and restrictions attaching to shares issued, as discussed above, are generally agreed and specified in the memorandum and articles of the development company and in a shareholders agreement. A shareholders agreement is a contract governing the relationship between the shareholders including the financial relationship, process of decision making and mechanism for transferring and selling shares. Such an agreement is a private agreement between the shareholders and is generally expressly agreed to take precedence over the memorandum and articles of association of the company. It is important to bear in mind that approval from relevant governmental organisations such as Dubai’s Real Estate Regulatory Agency and the Land Department are required for
the introduction of such investors. Additionally the master developer of the project in question must be notified as most plot purchase agreements require approval for change of control or sale of shares in a development company. Given the low valuations of property development companies that have resulted from the global recession, equity financing can provide a viable solution to the dilemma of the lack of financing for property development companies in these difficult times. The above information is not legal advice and is neither intended to create nor creates a lawyer-client relationship. Neither the writers nor Afridi & Angell are responsible for anyone relying on the above information. You are recommended to take independent legal advice. Shahram Safai is a lawyer, a professional engineer and a partner at the law firm of Afridi & Angell in Dubai.
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Decree no. (1) of 2009
Regarding Rentals in the Emirate of Dubai
We, Mohammed bin Rashid Al Maktoum, Ruler of Dubai;
After perusal of Law No. 16 of 2007 establishing the Real Estate Regulatory Agency, And Law No. 26 of 2007 regulating Relationship Between Landlords and Tenants in the Emirate of Dubai as amended, And Decree No. 2 of 1993 establishing Special Judicial Committee for settlement of disputes between landlords and tenants, as amended, And Decree No. 27 of 2007 regarding rentals in the Emirate of Dubai. Issue the following Decree:
c- If the rent value in year 2008 was 46 per cent to 55 per cent less than the average similar rent; the maximum rent increase shall be equal to 15 per cent of such value. d- If the rent value in year 2008 was less than 56 per cent of the average similar rent; the maximum rent increase shall be equal to 20 per cent of such value.
For the purpose of this Decree the similar rent value of the property unit means pursuant to “The Rent Index of the Emirate of Dubai” applicable on the date of renewing the tenancy contract.
There should not be any rent increase in 2009 for tenants who were leasing property units in 2008, which includes residential and non-residential properties, if the rent in 2008 was equal to or 25 per cent or less below the average similar rent.
1- The similar rent value shall be set pursuant to the Rent Index of the Emirate of Dubai which is attached to this Decree. 2- The Real Estate Regulatory Agency shall review and update the Rent Index of the Emirate of Dubai periodically.
The Real Estate Regulatory Agency shall coordinate with the Special Judicial Committee for settlement of disputes between landlords and tenants to set the relevant procedures to implement the provisions of this Decree.
As an exception to the provisions of Article (1) of this Decree, the maximum rent increase percentage of property units in the year 2009 for tenants who were leasing such units in 2008 shall be as follows: a- If the rent value in year 2008 was 26 per cent to 35 per cent less than the average similar rent; the maximum rent increase shall be equal to five per cent of such value. b- If the rent value in year 2008 was 36 per cent to 45 per cent less than the average similar rent; the maximum rent increase shall be equal to 10 per cent of such value.
Any other provision in any other local legislation shall be void to the extent it contradicts with the provisions of this Decree..
This Decree shall be published in the Gazette and enforced on the date thereof.
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(Signed) Mohammed bin Rashid Al Maktoum Ruler of Dubai
This Decree has been issued in Dubai; 4 January 2009
Law No. 33 of 2008
Amending some provisions of Law No. 26 of 2007 Regulating Relationship Between Landlords & Tenants in the Emirate of Dubai
We, Mohammed bin Rashid Al Maktoum, Ruler of Dubai;
• After perusal of Federal Law No. 5 of 1985, regarding Civil Transactions and its amendments, • And Federal Law No. 10 of 1992 Promulgating Law of Evidence in Civil and Commercial Transactions and its amendments, • And Law No. 16 of 2007, establishing the Real Estate Regulatory Agency, • And Law No. 26 of 2007 Regulating Relationship Between Landlords & Tenants in the Emirate of Dubai (referred to as the “Original Law”), • And Decree No. 2 of 1993, establishing the Special Judicial Committee to settle Disputes between landlords and tenants and its amendments, Issue the following Law:
residential, commercial or professional purposes or any other legal activity. Tenancy Contract: The contract by which landlord is committed to enable tenant to benefit from the property for specified purpose and period against specified consideration. Landlord: Natural or Judicial person who has, by law or consent, the right of disposal of the property and to whom the title of the property is transferred during tenancy period or to his representative or legal attorney, including the tenant authorized by the landlord to sublease the property. Tenant: Natural or judicial person who benefits from the property, or part thereof, pursuant to a tenancy contract and any person who receives the tenancy legally from the tenant. Subtenant: Natural or judicial person who benefits from the property, or part thereof, in accordance with a tenancy contract signed with the tenant. Rent: Specified consideration which the tenant is bound to pay according to the tenancy contract. Notification: Written notification sent by either of the tenancy contract to the other party through notary public, registered mail, personal delivery or by any technological means approved by law.
Articles (2), (3), (4), (9), (13), (14), (15), (25), (26), (29) & (36) of the Original Law shall be replaced with the following Articles:
This law shall be applicable to leased lands and properties in the Emirate, excluding free accommodations provided by natural or judicial persons to their employees.
Committee: The Judicial Committee authorized Agency: Real Estate Regulatory Agency. Property: Immovable property and its annexures rented for
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In implementing provisions of this law, the following words and terms shall have the meaning assigned to them, unless the text otherwise requires: Emirate: Emirate of Dubai.
1. The tenancy relationship between landlord and tenant shall be governed by a tenancy contract describing the property in detail, the purpose of the tenancy, period, rent and name of owner if the owner is not the landlord. 2. All properties subject to this law, or its amendments, are to be registered with the Agency.
1. Landlord and tenant must specify rent value in the tenancy contract. If both parties have not specified the same or if it becomes impossible to prove their agreement then rent shall be as per the similar rent. 2. The Committee shall specify the similar rent in accordance with the standards of specifying the rent increase percentage applied by the Agency and in accordance with the general economic circumstances in the Emirate, and pursuant to the property status, the similar market rent in the same area and in accordance with any valid legislation in the Emirate regarding properties’ rent and any other factors the Committee may decide.
1. Landlord may demand eviction of tenant prior to expiry of tenancy period in the following cases: a. If tenant fails to pay rent value, or part thereof, within thirty (30) days of landlord’s notification for payment; unless parties agreed otherwise. b. If tenant subleases the property, or part thereof, without landlord’s written approval and in such case eviction shall be applicable to the tenant and the subtenant, and the subtenant’s right to refer to tenant for compensation shall be reserved. c. If tenant uses, or allows others to use, the property for illegal or immoral activities. d. If the leased property is a commercial shop and the tenant left the same without occupation and without legal reason for 30 continual days or 90 non-continual days in one year; unless the parties agreed otherwise. e. If tenant causes changes that endanger safety of the property in a way that it cannot be restored to its original condition or if he causes damage to the property intentionally or due to his gross negligence to take proper precautions or if he allows others to cause such damage. f. If tenant uses the property for purposes other than the purpose it was leased for or if he uses the property in a way that violates planning, building and land using regulations. g. If the property is in danger of collapse, provided that landlord must prove such condition by a technical report issued by Dubai Municipality or accredited by it. h. If tenant fails to observe legal obligations or tenancy contract conditions within (30) days from date of notification by landlord to abide by such obligations or conditions. i. If development requirements in the Emirate require demolition and reconstruction of the property in accordance with government authorities instructions. And for the purpose of this clause (1) of this Article the landlord must notify the tenant through the Notary Public or by registered mail.
For the purpose of renewing tenancy contract, landlord and tenant upon expiry of the tenancy contract may amend any of the contract’s terms or review the rent whether by increase or decrease. If the parties do not reach an agreement regarding this, the Committee may decide fair rent considering the standards referred to in Article No. (9) of this Law.
If either party of tenancy contract wishes to amend any of its conditions pursuant to Article (13) of this Law, then he must notify the same to the other party not less than 90 days prior to expiry date, unless both parties agreed otherwise.
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Landlord shall be committed to hand over the property in good condition that enables tenant to obtain the benefit subject of the tenancy contract. However, it could be agreed to lease uncompleted property provided that the tenant completes the same and prepares it in a good condition to obtain the requested benefit, and the parties shall decide the party who will be liable for the costs of this completion.
2. Landlord may demand eviction of tenant upon expiry of tenancy contract limited to the following cases: a. If the owner wishes to demolish the property for reconstruction or to add new constructions that prevent tenant from benefiting from the leased property, provided that necessary licences are obtained. b. If the property requires renovation or comprehensive maintenance which cannot be executed while tenant is occupying the property, provided that a technical report issued by Dubai Municipality or accredited by it is to be submitted to this effect. c. If the owner of the property wishes to recover the property for use by him personally or by his next of kin of first degree provided that he proves that he does not own a suitable alternative property for that purpose. d. If the owner of the property wishes to sell the leased property. And for the purpose of clause (2) of this Article, landlord must notify tenant with reasons for eviction at least twelve months prior to the determined date of eviction subject that such notice be sent through the Notary Public or by registered mail.
The Chairman of the Executive Council shall issue the necessary regulations, bylaws and decisions to implement the provisions of this Law.
This Law is to be published in the Gazette and enforced on the date thereof.
Issued by us in Dubai on 1 December 2008 (Signed) Mohammed bin Rashid Al Maktoum Ruler of Dubai
This Decree has been issued in Dubai; 1 November 2009 A.D. 13 Dhu Al-Qadah 1430 A.H.
1. Tenant shall have priority to return to the property if it is demolished and reconstructed or if it is renovated, provided that rent value shall be fixed in accordance with Article (9) herein. 2. Tenant shall benefit from the above mentioned priority right within thirty (30) days from being notified by landlord.
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If the Committee decided for the landlord to recover the property for his own use, or use by his first degree next of kin pursuant to the provision of paragraph (c) of clause (2) of Article (25) of this Law, then landlord shall not rent the property to others for at least two years for residential properties and three years for non-residential properties from date of recovery of the property, unless the Committee decides less period for reasons considered by it, otherwise the tenant shall have the right to request the Committee to order proper compensation to him.
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