With a long list of high-profile developments such as the Jumeirah Beach Residence, Dubai Properties' Mohamed bin Brek tells Arabian Property his future plans for the property giant.
How did you start with Dubai Properties?
I started off with the predecessor of Dubai Properties, which was the Istithmar Property Company which was launched to take the challenge of the Jumeirah Beach Residence. That was in 2002. Initially I was responsible for sales and distribution, sales and marketing and then I managed to move up the ladder to the CEO of Istithmar before it was converted to Dubai Properties, which was around end of 2004. I've done almost everything in the company so my areas of responsibility included sales, marketing, finance, anything and everything so I was a jack of all trades.
I think until the change that happened in December last year I was really responsible for all the operations of the company and then we were given bigger challenges and our senior manager was promoted to chairman and I think he was happy with my performance and decided to make me the CEO.
And you were happy too?
You bet I am. The real estate property field is something that presents new challenges every day and you learn new things every day. I never come to work without learning something new.
Is that then the best part of the job for you?
I've got many bests. In my previous life I was a banker and you know in banking while it's a service industry, the opportunities of creativity are very limited. It's a question of how you make your services better, how you improve your standards but beyond that you are really limited with how to be creative.
This business is where we are creating new norms; it's something different for this part of the world. The challenges that we come across everyday were not anticipated and we have to tackle them and there's an opportunity to be creative in tackling them, finding solutions, learning not only from countries that have been through the same route but even businesses that have been there.
What do you think made Dubai Properties successful in the regional property market?
I think the word is that we were allowed to dream. We dreamt up a vision for this company. We were given the opportunity and the playing field to bring that dream into reality and clearly and most importantly we managed to get together a fantastic team of people who worked with us and dreamt with us in the same direction. The people element has made us very successful.
Are there any plans to take the company into other markets?
I never like to say no to any opportunities but this is a market that has been exciting, innovative and creative for us and I believe will continue to offer us all those facets here so I don't have anything in the horizon that says I should go overseas to invest. The opportunities are still great in Dubai, the challenges are also nice and this is a market that is still on an upward curve in terms of trajectory. If something is presented to us that is interesting overseas, I am not going to say ‘No, we are not going to look at it', but we are not scouting for any opportunities yet outside the UAE.
Basically, you're saying there's a lot to be done here before you consider such a move?
Absolutely, I mean clearly, if Dubai continues to offer the same level of opportunities, there comes a time in a company's growth, for diversification purposes, you might want to do something different, but I think we are relatively young to start talking about diversifying overseas.
A lot of people still talk about the market heading towards over saturation whereas many are contradicting that and saying it's still too early for that with the number of people coming into the country?
I am a firm believer that this is still a market that still has wind in its sail and is still going to go places; the growth opportunities are going to be great. It's really a question of supply and demand. And the demand in this market will continue to be substantially high in the next few years. I see no reason why there should be saturation in the property market now in Dubai. Secondly, people always talk in relative terms, they look at it in terms of returns, and if you do that this is not an investment when you see quick returns overnight. We need to start thinking or rethinking the prospects like ‘I'm going to double the prospect of the property in two or three years'. But it's always proven that property prices go up in a long-term basis and in the short-term, as far as Dubai is concerned, property prices will continue to be substantially high.
Compared to Europe and other countries, property here is still cheaper of course but what about catering not only to the high-end market?
We are a business entity, if the market didn't want high-end properties we wouldn't be building them, but clearly the market still has a requirement for high-end property. We are not saying that we will not build property for middle income. In fact we started off wanting to build properties for middle income but people have aspirations. You start off with something and you move on to something else. People I think of our age are the ones growing the market. There will come a time when 20-year old will come and buy property themselves and I am sure we will cater to their needs. At the moment, even the 20-year olds love buying high-end properties; the only difference is they look for smaller size units, vis-à-vis bigger size units.
Definitely, we are substantially lower than many European countries or other developed economies in terns of value and returns, Dubai offers a much higher returns value than other markets.
But you are looking into catering to the lower-end?
Definitely, we pride ourselves as being the company that provides end-to-end real estate solutions, so in terms of anything from the evolution of the product to how we actually maintain the asset and the value of that asset. More importantly would be looking at catering for the needs of people who want to buy property whether it's high or middle income and even for the low-end people, providing them with housing or a lease, etc. It's just not a market where everybody wants to buy, we have to accept that and we recognise that as a company. We have a portfolio where we build to sell and a portfolio where we build to lease.
Generally what is the feedback from your customers about the quality and services you offer?
We hear many complaints nowadays from people about different developments. We are in the process of handing over our Jumeirah Beach Residence project and we are happy that the feedback that has come through has been positive. A lot of people, clearly there was this issue about the project being delayed but the good news we feel, that is based on the feedback, that the delay was worth it because they feel the end product has met their satisfaction. Is this going to be it? I don't think so, we need to constantly challenge ourselves and come up with better ways of doing products because customers' tastes change. Customers want to see better things as we go along and I am sure we are on the way to upgrading.
How do you do that? How do you get their feedback?
The way we do our product, during the concept evolution phase, we first of all work with some international companies that have been through this experience, whether it's design, consulting, etc. Then we have what we call a test or sample group from which we get feedback, input from. This is something that our executive chairman is very good at. He tends to network quite closely to get the feedback and input of what the market is looking at, but as a system we put it in places which we call focus groups and then you have to remember that within our organisation and structure we also have checks and balances. For example our design and development team see themselves as the people representing the end-use. They are the team that makes sure that our project manager team delivers to our customers what we have promised. So far I think it has been a good proposition.
After the JBR (Jumeirah Beach Residence) project which is the next property to be handed out?
Just before JBR project we have handed some villas, the Cordoba Villas, but these are in our leasing; not selling portfolio. We are now handing over JBR, later on we have another leasing portfolio in Healthcare City, and we'll be handing that over some time in the summer. But the major project we'll be handing over next will be the executive business towers in Business Bay which we'll be handing over about the same time next year.
Can you tell me more about the DFM move from the DWTC?
We are extremely pleased and gratified that DFM has decided to shift their base of operations into Business Bay. I think it clearly demonstrates that what we have been saying, that Business Bay is going to be the region's new business capital. This is an endorsement from an entity that operates in Dubai and has recognised the value and importance that Business Bay is going to play in the community in Dubai.
The way that we see it is that the move of DFM will attract support services or the broker's industry themselves who would want their offices to be closer to where the DFM is and potentially, we have heard of the financial services industry wanting to cluster themselves so we are hoping that this will give them some food for thought to consider making Business Bay their regional quarters.
How long has the move been in the planning?
It's something that we have actually discussed with the DFM quite recently, less than three months. Now we are in the process of finalising the actually design, drawings, we need to get into the integrity of their inputs.
Clearly, yes we know that they have a requirement of so much office space, but I think we now start looking at the details of how the actual offices would look inside and it's a process that probably will take another three to four months which probably from September you'll see construction works starting on site.
You're very positive that their move will be helping their operations more than in the DWTC (Dubai World Trade Centre)?
I think that the place they have chosen for their offices is a beautiful location, they've got water features around them, lots of green space and quite close to them they've got the facilities of retail space, a mall.
It's also going to be overshadowed by our new signature tower, commonly known as Dancing Tower. It's a beautiful area in terms of access, the traffic impact study that has been undertaken will ease the traffic coming in and going out. I think most importantly the way they have requested this new location takes care of their needs of growth for quite some time in the future.
I think the dilemma they are facing in their current offices is there isn't enough space for them so it's a great location and a fantastic opportunity for them and for us.
What do you think are the challenges the construction market Dubai is facing today? Some say the labour pool is being over-exhausted. What do you think?
The market clearly requires more construction companies to be able to undertake the level of projects and activities happening in Dubai. However, having said that I think the companies that are already in the market are doing a good job.
They've had to go and bring labour from various markets to come and work within Dubai. Whoever has worked or partnered with us we have worked closely with them to support them in whatever means to bring in more labour pool.
I don't think there is an exhaustion of the labour pool, the reality is that the region is going through such a great boom that the issues of demand and supply of labour are raising various challenges.
The South East Asian countries which most of the labour come from are also going through a construction boom over there and these are the challenges that construction companies are facing, but I think they are doing a very good job and they will overcome whatever problems they face because at the end of the day people come to this part of the world for aspirational reasons.