ACI managing director Robin Lohmann likens his fervour for property development to the attitude of Formula One driver Niki Lauda. "We had difficulty entering the Dubai property market and we've faced problems with our first project; Niki Lauda also faced opposition and was badly injured in an accident but he didn't let it stop him," he explains. "He's living life with passion, and so are we.
"If you come to Dubai you have to be a special kind of risk taker, you have to have a goal and be able to continue with it, despite what other people may think. I like it here, I'm a young guy, I'm 32 and a special kind of risk taker but not as crazy as Lauda," he laughs.
While professing to be less fanatical, Lohmann does identify so strongly with the former Formula One great that ACI has teamed with the brand to launch the Niki Lauda Twin Towers in Dubailand.
The Twin Towers hotel project is one of four developments ACI has underway in Dubai, although the company initially came to the Middle East with a different business purpose in mind.
The German father and son investment firm first arrived in Dubai in 2004 after becoming interested in the potential of the Dubai International Financial Centre. Lohmann senior and Lohmann junior, who has a background in investment banking with Goldman Sachs and Merrill Lynch in London, planned to enter the DIFC with a wealth management offering.
The group is already established in Germany in the asset management, structured finance and risk management fields and intended to expand this business into the dynamic UAE market. However, on arrival they quickly identified the investment opportunities of the Dubai property market, and established the ACI real estate group.
The company launched their first fund for Dubai Star, their mixed-use development in Jumeirah Lake Towers, followed soon after by funds for the City of Arabia in Dubailand and Q Sami in the Business Bay. Lohmann says that ACI uses the maxim ‘location, location, location' to guide its US$30m Dubai operations.
"My father says this is the most important thing, a premium location is an absolute must. Our projects in prime locations, including Victory Bay, the City of Arabia and Dubai Star have all sold out quickly." Lohmann is enthusiastic about the future of ACI and Dubai, although he concedes the city is currently suffering teething problems.
"Yes, the infrastructure problems are an issue but you will find that in any city. There is no other city in the world where you will see growth like we are seeing here. The speed in which the Metro is being built is amazing; there is nowhere else where you see a development on such a scale.
"It's hard to believe this has happened over one generation; only 30 years ago, there were camels around the World Trade Centre. Who knows what will happen here by 2015. If the predictions are correct, Dubai will have doubled in size and will be hosting 15 million tourists. We can't wait to see what is going to happen.
"There is a lot of talk about the time delays in construction, but our investors understand this when we explain that 25% of the world's cranes are currently operating in Dubai. I believe when you have development on this scale you have the right to some delays; everything has to happen within a reasonable time frame."
Lohmann believes Dubai is a front-runner in terms of GCC countries attracting international investment. "We are seeing a lot of European investors here now, particularly from the UK and Holland but also Russia, the Far East and America. There are more and more international purchasers. However, with developments now underway in other regions like Qatar, the investment focus could slip from Dubai," he notes. Despite this concern, he is confident that European investors will continue to find the UAE market attractive.
"Europe is an over-regulated market, which is blocking development but in Dubai there is more freedom for development because the market is so young. Rules and regulations are increasing which is protecting purchasers more, and that's a good thing," he continues. "Rules and regulations inject more trust and this is an important thing for investors. It's important that international trust can be improved without disrupting the existing market."
Lohmann feels the single biggest problem facing Dubai is the issue that 75% of property purchases are undertaken by speculators and only 25% by end-users. This had led to infrastructure problems, and inappropriately designed commercial and residential properties. However, he believes this imbalance would correct once Dubai became more attractive for the end-user.
"At the end of the day, this is a special place and as soon as more entertainment, more attractions like the Dubailand Entertainment Park are completed, I truly think we will see the full potential of the city realised."For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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