By Neil Halligan
Phenomenon known as the ‘transit premium’ likely to impact areas like JBR and Dubai Marina, agents claims
Dubai’s new tram could add significant value to properties in the vicinity of the new mode of transport, according to property agency Chestersons.
The Dubai Tram is due to open on November 11 this year and consists of a 10.6km-long track starting from the Dubai Marina and stretching up to the Tram Depot near Dubai Police Academy.
The tram is expected to transport about 27,000 passengers per day at the start of operations, increasing to 66,000 per day by 2020.
“The proximity to high-capacity transit halts has proven to increase property rates, a phenomenon known as the ‘transit premium’. This has been true in the case of Jumeirah Lake Towers, which is in the limelight and a much sought after destination after getting connected with the Dubai Metro network," said Simon Gray, managing director, Chestertons MENA.
He said the tramway is potentially poised to change the dynamics of property prices, particularly in Jumeirah Beach Residence and Dubai Marina areas, where residents rely heavily on taxis for commuting purposes.
Robin Teh, Country Manager, Chestertons Mena, said the ‘transit premium’ has historically seen property prices increase by up to 150 percent in some areas.
“The increases in property values near transit were most dramatic for office and retail spaces,” said Teh.
“The price swings for property located near and around the tramway will be triggered by the new infrastructure as per general consensus, but the facts would emerge once the phase one of the network opens in November,” he added.
He said businesses will also benefit as a result of increased volume of people travelling to JBR and Marina.
The tram network will feature 17 passenger stations and a fleet of 11 trams in the initial phase. Fourteen trams will be added in Phase 2 to make a total of 25 operating trams.
Each tram has seven coaches, including a gold suite and one cabin dedicated to women and children. It will be operated by Serco, the same company that manages the Dubai Metro.
Any statistics to back up these claims? Did the freehold areas at the JLT, Marina, Downtown increase by 150% when the Metro opened?
Of course prices didn't increase by 150% due to the metro. That's a preposterous claim. This is another feeble attempt at kicking some life back into the property market.
It's going to take more than a new tram to do that though, and the prices are already too high (hence why the market is all but DEAD).
The tram is a great addition to public transport in Dubai though. No doubt about that. Looking forward to it. I see they are building a bridge into the Palm Monorail station as well. Happy days!
so lets see... my appartment that cost me aed 3 million and generates rent of 180k will go to 7.5 million and I can ask for rent 450k???
This is the usual HYPE by Property Agents who are always looking for new tricks to boost their sale, and therefore their commissions. No doubt that any improvements in transportation services in any location will boost the prices of that area, but this figure of 150% is just pulled from the sky. How did they calulate this? Magic?????
glib, facile comments from glib facile real estate agents. Enough to make one go back to reading comic books.
150%????? No way! How do agents work on such numbers? Tram will help traffic in already crowded Marina area. But prices are too high already. How much more value would any see in buying such brick n mortar homes!
What a desperate news story.. do Chestertons need to comment and offer there 'opinion' on any half news story? JLT is in the limelight since when? Do they not know the focus of the market has shifted to offplan and much more recently completed developments not within the Dubai Tram Line.
Price hike be dammed...for any one staying near the tram crossings, the traffic has worsened especially in Marina as the signals have slowed down so it takes longer to cross.
When ever the tram crosses the road , it becomes Santa Claus on a sledge jingling all the way . This is during the testing phase and its a pain...I dread the fact that I will head Santa's jingling from 5am till 2am. How lovely is that
From the Marina , if I want to go to JBR, yes the tram is helpful, but if I want to go to knowledge village, I cant use the tram because it does not go there....so I have to take a taxi
nothing will change except accidents and complaints as its a new thing on road. also the mentioned "offices and retails" will remain unsold as there have been next to none transactions of commercial properties all over Dubai for past month or so. landlords must keep their minds right and don't ask for ridiculous prices as it will further damage the already slow market
The tram will be a huge success. Thousands of people will be taking it to avoid the snarled traffic....created by the tram.