Developers in Abu Dhabi island leasehold frenzy

Long leasehold developments aimed at expats planned for Abu Dhabi archipelago

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By  Sean Cronin Published  August 20, 2005

The first developments to be earmarked for foreign property ownership in Abu Dhabi will be built on its offshore islands. Developers are already lining up to announce projects and be the first to capitalise on investor enthusiasm for long leasehold property ownership. And home finance companies are also setting up shop in anticipation of an upsurge in demand from investors. It follows an announcement last week by UAE president and ruler of Abu Dhabi, His Highness Shaikh Khalifa bin Zayed Al Nahayan, allowing foreigners to own property in designated areas of the emirate for the first time. Recently floated developers Addar Properties, Aldar and Surouh Real Estate are all close to launching developments aimed at the expat market. Local real estate agents say the first long leasehold properties to be developed in Abu Dhabi will be built offshore. “Abu Dhabi has a significant amount of islands which are certainly well suited to be long leasehold opportunities and which are currently undeveloped,” said Colliers International director Ian Albert. Developers have welcomed the announcement and some, such as Abu Dhabi-based Aldar Properties, are already preparing to launch their first developments aimed at expats. The Al Raha waterfront development being built by Aldar Properties will almost certainly be long leasehold, as well as Al Reem (Abu Shuoom) Island where a 1.8 million m2 US$ 5.4 billion (AED20 billion) development is planned. Residential schemes are also planned for Hodairiyat and Jubayl islands, which will be targeted at foreign investors. Emaar-backed home finance company Amlak also wants to quickly gain a foothold in Abu Dhabi’s fledgling lease-hold market. “We see enormous potential in Abu Dhabi’s real estate market, just as we saw in Dubai’s market when we first began operations in 2000. “Companies like Aldar and Surouh have many developments which will build much needed residential and commercial property in the emirate,” said chief executive Mohammed Ali Al Hashimi. Building activity in Abu Dhabi has been stepped up in recent months and new developments coming to the market have been snapped up by investors. Aldar Properties sold the first batch of 1400 properties to be released at the Al Raha Gardens development instantly after randomly selecting names from 21 000 United Arab Emirates’ nationals who applied to buy the properties. A second release of properties on the development is expected some time within the next two months. It is likely to be one of the first schemes to be made available to foreign buyers. Aldar is also currently pre-qualifying for the redevelopment of the Central Market in Abu Dhabi.

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