Dubai developer says revenue from apartment sales more than doubled, off-setting drop from commercial units, villas
Dubai' Emaar Properties, developer of the world's tallest tower, the Burj Khalifa, said on Tuesday that revenue from apartment sales more than doubled in the second quarter off-setting a drop in sales of commercial units and villas.
Dubai's largest developer said revenue from the sale of condominiums in the second quarter was AED699.3m (US$190.4m), compared to AED265.6m in the prior-year period.
However, revenue from commercial units and plots dropped to AED116.2m from AED596.5m during the period. Villa sales also slipped by about 3 percent to AED325.6m.
Income from the hospitality sector rose slightly to AED316.6m from AED283.8m during the period.
The total revenue rose slightly to AED2.1bn from AED2bn.
Emaar reported in July that its second-quarter profits had more than doubled.
The developer launched its new development 'Panorama at the Views' consisting of over 200 luxury apartments earlier this year, which the developer said were quickly sold out.
Revenue from apartment sales for the six months ending June 30 was AED975.5m compared to AED640.5m.
Emaar is one of the better performers among property companies in Dubai as the sector recovers from a roughly 60 percent drop in real estate prices from their peak in 2008.
Shares of Emaar were up 0.6 percent at 0645 GMT. The stock has climbed by 35 percent this year.
I hope the PR mavens at Nakheel have read this, and can see that facts make a story, not fantasy.
I'm assuming that Emaar's oustanding stock of apartments is now dwindling rapidly, good developer as they are, so now that particular revenue opportunity will flatline for a while.
Surprised to see such a modest increase in hospitality revenue, because as they reached roughly the same revenue in the first and second quarters overall, the third quarter will be tougher all round.
Any property market recovery starting from such a low base, i.e. one where prices are down 60 per cent from peak, will take many, many years to get anywhere near the original benchmark 2008 values, if ever!
Advice, for those that bought to live at the wrong stage of the inflation cycle and still want to offload. Factor how much rent you've saved into the equation and if you've broken even including sales and transfer fees, might as well sell, as wait another ten years!!
Third Quarter in the UAE is often tough as it falls during the worst part of the summer. With this year, the only hope that exists is that Eid falls in the 3rd Q and several countries that people usually went to are now out of reach due to war (such as Syria and Lebanon). Any investor should know this and be prepared for lower figures in Q3 than in other Qs.
As for using the 2008 values as benchmarks, i'm sorry but on which planet do people use a year known for ridiculous inflation and overpricing as benchmarks? In which country are figures of unsustainable growth used as the basemarks for valuations? It would be better to use 2007 or even 2006; but regardless of which year is used, it is quite telling that 5 year old figures seem outdated for the UAE, its a sign of the continued growth and development of this nation, something that many people chose to ignore till today.