By Sarah Townsend
Developer launches first phase of 5 million sq ft mixed-use project near Jebel Ali
Dubai developer Deyaar Development has pledged minimum 7-8 percent yields for investors in its new Midtown project near Dubai’s Jebel Ali, as it launched the first phase of the scheme on Monday.
The developer said it is in talks with an unnamed shariah-compliant bank to finance 30 percent of the total AED2.5-AED3 billion ($817 million) cost of the scheme.
The figure takes in the cost of land, construction, consultancy fees and associated infrastructure – the bulk of which, for example utilities and roads, is being provided as part of the wider International Media Production Zone (IMPZ) development of which Midtown forms a part.
Deyaar is expected to retain at least half the scheme for leasing, and the cost shortfall to be covered by phased sales of units over the next 3-5 years, its CEO Saeed Al Qatami told reporters on Monday.
Spread over 5 million square feet of land and 47 residential buildings, the scheme comprises 2,500 apartments of varying sizes, 400,000 sq ft of landscaped terrain, 4,000 car parking spaces and 5,000 sq ft of sports amenities including basketball courts, tennis courts, swimming pools and jogging track.
There will be a retail component comprising a 1km-long stretch of shops, cafes, restaurants, nurseries and medical clinics.
And, as a later stage of development, Deyaar hopes to add a hospitality element, too. Qatami said the company is “in advanced stages of evaluating the business model”.
The first phase of Midtown is called Afnan District and opened to prospective investors from this week. It comprises 659 apartments ranging from circa-400 sq ft studios to 2,000 sq ft two- and three-bedroom apartments.
Construction is expected to start on the first phase by the end of this year and complete by the end of 2018. It is estimated that 90 percent of the entire project will be complete by the end of 2020, in time for Dubai Expo2020.
Al Qatami said the development, to be situated within easy access of Sheikh Zayed Road, was intended as an affordable option for middle-income families, including expats wishing to settle in Dubai – but declined to reveal prices ahead of the official sales launch next week.
He said: “Over the last 10-11 months [since unveiling the scheme at last year’s Cityscape conference in Dubai], we have worked closely with architects and other consultants to determine the right mix of uses to bring to the development.
“Our project offers occupants an all-inclusive serviced community within an open environment that provides an ideal space to call home.
“The neighbourhood is set to create a green and aesthetically pleasing environment by incorporating 400,000 sq ft of landscaped terrain.”
Deyaar was one of Dubai’s worst hit private developers during the recession. But in July Deyaar reported a 37.5 percent increase in second-quarter net profit to AED85.8 million ($23.4 million). This compared with a profit of AED62.4 million in the corresponding period of 2014.