Lagoon to provide fair share

Danial Husain, vice president, Dubai Lagoon talks to CW about the strength of Korean engineering, the need for more Jebel Ali communities and his tip for the future: Dubai timeshare.

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By  Zoe Naylor Published  September 16, 2006

|~|137int200.gif|~|Husain says that the construction contract was awarded to a South Korean consortium because they are used to working on large-scale projects.|~|What is the background of Dubai Lagoon?

Dubai Lagoon is one of the largest private developments of its kind in Dubai. It is located in Dubai Investments Park, close to the Green Community and the new airport that is planned for Jebel Ali. The land area of the project is around 163,000m2, and the built up area will be 465,000m2.

We have 4,100 apartments in the project. Phase one sold out in 52 days and is one of the fastest selling private developments in the UAE. Phase two, which we’re just starting now, is already around 50% sold out. We also have seven buildings that we are holding back for timeshare. The overall value of the project is around US $545 million (AED2 billion).

Will Dubai Lagoon be a purely residential development?

No, it will be a mixed-use development. There is about 19,000m2 of commercial area within the development, including nursery, kindergarten, healthcare facilities and various shops – it’s a self-sustained community with everything that people need. When it’s up and running we expect it will house around 10,000 people. There are also three golf courses in the area, two designed by Greg Norman and one by Vijay Singh, so it’s bound to be the next upscale suburb of Dubai.

What stage has the construction process reached?

The joint venture of Daewoo Shipbuilding and Marine Engineering (DSME) and Sunjin C&A of South Korea will carry out both phases of construction of the project, including the housing units, internal roads, landscaping, lagoon formations and MEP.

They will start by doing the basement works for both phases together because there is so much infrastructure work required for this project – it’s going to be an entirely new city with its own district cooling. Phase one has a 16-month timescale and is due for completion at the end of 2007, and phase two is 24 months and should be ready in mid-2008.

Why did you choose to award the construction contract to a South Korea-based consortium?

To bring them in to the market. They have been involved in similar sizeable construction projects before and financially they are very secure – DSME, for example, is the third biggest shipbuilder in the world.

How does the lagoon feature within the project?

This will be a man-made feature and will consist of crystal-clear blue water. We’re using the latest ozone purification technology to ensure the water remains a sky blue colour.

What will set Dubai Lagoon apart from all the other developments in Dubai?

It is being developed with the mid-management segment, which constitutes a large part of our society, in mind. This is one reason why we have witnessed a huge demand from homebuyers as well as from investors.

We started off with a payment plan that had never been seen before in Dubai. Normally people pay between $1,090 and $1,360 per month to rent a one or two-bedroom apartment in Dubai. We asked how we could make a proposition whereby they pay that much per month, and yet get to own an apartment? So we came up with a scheme whereby you pay 60% over the initial two years, take possession and then pay the balance over five years, like rent. So the monthly cost becomes cheaper than rent.

Also, if you look at all the traffic going from Sharjah to Dubai every day, with people getting up at 5.30am for work at 9am, we thought why not make something affordable close to Jebel Ali, where many of these commuters work.

Do you think you’re going to be paving the way for future developments that are geared towards the mid-level sector of Dubai?

I believe so. There’s definitely a niche in the Dubai market and it is something that a lot of developers these days are now approaching. If you look at the development next door, we’re located right next to the Green Community, which we believe is another selling point. The Green Community has appreciated 300% since its launch date.

Is timeshare a relatively new concept for Dubai?

It’s a very new concept here. There have been a lot of queries in regard to timeshare for Dubai because it has become such a hotspot destination to visit and live. If you look at timeshare it’s a win-win situation for both the developer and end-user. A per-night cost is about $33, which is way below any hotel in Dubai, and it is fixed for 40 years. I see timeshare taking off in a big way over here.||**||

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