Property prices continue to rise in Dubai as more people buy homes. Bloomberg
Property prices continue to rise in Dubai as more people buy homes. Bloomberg
Property prices continue to rise in Dubai as more people buy homes. Bloomberg
Property prices continue to rise in Dubai as more people buy homes. Bloomberg

Demand for branded residences remains strong amid Dubai property boom


Fareed Rahman
  • English
  • Arabic

Demand for branded residences in Dubai is expected to remain strong as wealthy buyers continue to boost spending amid a boom in the real estate sector, according to developers and analysts.

Dubai, the commercial and tourism hub of the Middle East, is developing a number of branded residential projects in partnership with hotels, fashion and automotive brands, such as Bugatti, Pagani and Mercedes-Benz.

“The demand (for branded residences) is there and is growing year-on-year,” Haider Tuaima, director and head of real estate research at ValuStrat told The National. “This was probably the third or fourth year, since Covid- 19 that the demand for high-end luxury properties continues to grow.”

Branded residences refer to property developments that carry the stamps of iconic brands.

The business provides developments with its branding, services and amenities, according to global real estate consultancy Knight Frank.

Often – but not always – branded residences will sell for a premium above their non-branded counterparts.

High-net-worth-individuals are investing in the branded residences as they “would like to have something that is managed or that is branded, or that is associated with the brand, in order to ensure that every time they visit the country or they visit their property, it's always at a high standard and well maintained and well managed.”

Branded residences also offer investment opportunities for buyers as property prices continued to rise across the UAE amid government initiatives and overall growth in the economy.

Prices of $10 million-plus homes in Dubai grew at one of the fastest rates globally, as overseas demand for prime residences in the emirate continues unabated.

Dubai’s prime residential market, which includes The Palm Jumeirah, Jumeirah Bay Island and Emirates Hills, saw prices grow by more than 26 per cent last year, property consultancy Knight Frank said in a report in April.

“The main drivers for branded residences are prestige, brand identity, international appeal, being part of the brand’s global hospitality network, superior levels of service, design, furniture packages, finishes along with investment potential through premiums and rental pools,” Prathyusha Gurrapu, head of research and consulting at Cushman & Wakefield Core, said.

“Typically, branded residences command price premiums of about 25-30 per cent compared to non-branded residences of similar build quality," she said.

Branded residences in Dubai are currently transacted at an average of around Dh6,500 ($1,769.9) per square foot, with pricing influenced by factors such as location, waterfront or beach access or views, brand associations, service levels and concepts, she added.

Currently, there are a number of branded residences that are being constructed in Dubai. These include Armani Beach Residence at Palm Jumeirah with 53 units, Cavalli Casa tower at Dubai Marina with 436 units, Mercedes-Benz Places with 150 units at Downtown, Bugatti Residence at Business Bay with 182 units, and Bulgari Lighthouse with 31 units at Jumeirah Bay.

The starting unit price at Bulgari Lighthouse is Dh64 million, while the starting price at Bugatti Residence is Dh19 million, according to Knight Frank data. Mercedes-Benz Places, which is being developed by Binghatti Properties, is being sold starting at Dh8.8 million per unit.

Armani Beach Residence by Arada is being sold at a starting price of Dh21 million per unit.

"Branded residence as an asset class is enjoying sustained growth across the world, with markets in the Middle East, specifically Dubai witnessing a significant rise in demand, fuelled by UAE’s global reputation, appealing lifestyle, safety, and strong investment potential. Dubai also boasts the highest inventory of branded residences compared to any other global city," Ms Gurrapu, said

More than 4,600 branded units are expected to be delivered in Dubai in the next five years, with more projects in the pipeline, according to Knight Frank.

Damac, as well as Dar Global, said they are planning to launch new projects amid higher demand from buyers, senior executives at the company said.

Mercedes-Benz Places in Downtown Dubai with unobstructed views of the Burj Khalifa. Photo: Binghatti Properties
Mercedes-Benz Places in Downtown Dubai with unobstructed views of the Burj Khalifa. Photo: Binghatti Properties

Dar Global, which is developing projects in partnership with global brands, including Missoni, Aston Martin, Pagani and W residences, plans to launch another project in the UAE after selling most of its units in its four projects.

"The market continues to be strong and the demand fundamentals have not changed," Ziad El Chaar, chief executive of Dar Global told The National.

"The demand for investing is increasing and the UAE population is increasing at the same time... you still have a lot of people who are still finding their second home in the UAE because they are setting up a lot of businesses in the UAE," he said.

Safety and security is one of the main elements driving people to choose the UAE as a home for themselves and their families, he added.

Global HNWIs are expected to spend $4.4 billion buying Dubai property this year, up 76 per cent compared to last year, says a Knight Frank report following a survey with 317 wealthy people, with an average net worth of $20 million globally and $8 million in the Gulf region.

GCC-based HNWIs are projected to spend $3.1 million buying a house in Dubai, while the global ultra-rich will allocate $36.5 million, on average, on property deals, it said.

The global arm of Saudi Arabia’s biggest developer Dar Al Arkan this month launched a beachfront residential community worth $250 million on Al Marjan Island in Ras Al Khaimah, in partnership with British luxury brand Aston Martin.

Damac Properties is also looking to build new projects focusing on branded residences amid higher demand. It is currently developing branded residential properties in Dubai in partnership with brands such as Cavalli and Swiss jewellery brand de Grisogono, which it acquired in 2022.

"We will continue to serve this demand and enrich our portfolio with branded residences across key locations in Dubai," Mohammed Tahaineh, general manager of projects at Damac, said.

He expects an "exponential rise" in demand for branded properties over the next four years as investors in the UAE increasingly seek high-end real estate.

"We have seen the market mould towards this trend, supported by reports that indicate that Dubai is going to see the number of branded residences double over the next five years."

The company's buyers include a mix of investors, home seekers, and HNWIs from diverse markets, including the US, Europe, India, China, and Russia, he said.

EMIRATES'S%20REVISED%20A350%20DEPLOYMENT%20SCHEDULE
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Company profile

Date started: 2015

Founder: John Tsioris and Ioanna Angelidaki

Based: Dubai

Sector: Online grocery delivery

Staff: 200

Funding: Undisclosed, but investors include the Jabbar Internet Group and Venture Friends

Name: Peter Dicce

Title: Assistant dean of students and director of athletics

Favourite sport: soccer

Favourite team: Bayern Munich

Favourite player: Franz Beckenbauer

Favourite activity in Abu Dhabi: scuba diving in the Northern Emirates 

 

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Company: Justmop.com

Date started: December 2015

Founders: Kerem Kuyucu and Cagatay Ozcan

Sector: Technology and home services

Based: Jumeirah Lake Towers, Dubai

Size: 55 employees and 100,000 cleaning requests a month

Funding:  The company’s investors include Collective Spark, Faith Capital Holding, Oak Capital, VentureFriends, and 500 Startups. 

Honeymoonish
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Director: Wes Anderson

Starring: Bryan Cranston, Liev Schreiber, Ed Norton, Greta Gerwig, Bill Murray, Jeff Goldblum, Scarlett Johansson

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Abu Dhabi Equestrian Club race card

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Occupation: Founder of the Studio, formerly an analyst at Cleveland Clinic Abu Dhabi

Education: Bachelor of science in industrial engineering

Favourite hobby: playing the piano

Favourite quote: "There is a key to every door and a dawn to every dark night"

Family: Married and with a daughter

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Age: 59

From: Giza Governorate, Egypt

Family: A daughter, two sons and wife

Favourite tree: Ghaf

Runner up favourite tree: Frankincense 

Favourite place on Sir Bani Yas Island: “I love all of Sir Bani Yas. Every spot of Sir Bani Yas, I love it.”

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Investing success often hinges on discipline and perspective. As markets fluctuate, remember these guiding principles:
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Name: Thndr
Started: 2019
Co-founders: Ahmad Hammouda and Seif Amr
Sector: FinTech
Headquarters: Egypt
UAE base: Hub71, Abu Dhabi
Current number of staff: More than 150
Funds raised: $22 million

The%20specs
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Number of Chinese people in International City: Almost 50,000

Daily visitors to Dragon Mart in 2018/19: 120,000

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Updated: July 06, 2024, 4:53 AM`