Launched in 1969 she is undoubtedly going to need a full refit and Dubai will be responsible for this sensitive project. Mr Ursprunger, CEO of QE2 Nakheel, has this task and his new first lady seen by millions as a demure sophisticated lady is about to have a full Hollywood style extreme makeover. She is going to totter into the Beverly Hills drydocks 90210 of Port Rashid looking a bit saggy and after a couple of years come out completely transformed into the usual 'fur coat and no knickers' sparkler Dubai is famous for. For $250m of facelift lets hope they don't use the same surgeon as Cynthia Weinstein.
There are plenty of rumours surounding what the QE2 will offer so straight from the unenhanced lips of Mr Ursprunger here is my current take on what the new project will offer.
A spur of reclaimed land just past Al Khudrawi will be named the 'QE2 Precinct' where the liner will be docked. The liner will be converted into a 200 room hotel offering a theatre capable of supporting Broadway shows, 5 Reastaurants, a huge spa, and a maritime museum.
The land area will consis of 65 residences, English Gardens and marina facilities. All in all this project is a massive plus for the Palm Jumeirah and those of you who have invested in the Shorelines must be feeling very smug. When this project is finished the Palm will be a true resort and prices for real estate will be through the roof.
Property
The market is quiet at the moment but the hard core investors are pinching themselves with excitement. I spoke to one of our more cavalier clients a couple of days ago who is convinced that this 'correction has provided the opportunity to make some great deals and duplicate what he has achieved over the past 5 years'. Good Luck my friend but please show some loyalty and remember our number.
Amlak and Tamweel ( Mortgage Lenders) are now merging their businesses which in essence makes them the Fannae and Freddie of the UAE. I expect this power house to start lending again in the new year and kickstart the market. Over the past 4 weeks property sales have been slow but only because buyers are struggling to get finance. Once this nationalised mortgage lender gets started you will see prices firm up considerably. In addition to this Abu Dhabi have created their own lending arm, AD Finance, which will be run by our old friend Philip Ward ( ex Barclays). This guy knows how to set up mortgage departments and Abu Dhabi will pump mega money into this company to stimulate growth.
This is all the market needs to see a real difference as the rents are spiralling out of control and many of these over charged tenants are looking to buy.
I promised you some big news last week which has not materialised.. My collagen free lips will have to remain sealed a while longer before i spill the beans ....
Thanks for the comments last week and a big hello from the Villa to Louise.
Good news that lending institutions are being set up with a view to actually lending money!?! This would be a radical new concept in the current market. You can understand banks fear with property prices taking a drop, given the world cash / credit crisis and subsequent assett valuation falls that are bound to follow as a result, - but with no reasonable lending available the prices could go way too low (for me). Things have been presented as being pretty dire (& as a result they are right now) and the market has been talked way too far down already(as is usually the case in bad times); but it seems some commentators are becoming a little more 'reasonable' with their forecasts and if there is going to be lending available again soon we should have a market re-appearing. Hurrar!
ReplyDeleteDue to all of the negative press that real estate markets are currently receiving, potential investors are beginning to forget actually how impressive the Palm Jumeirah is going to be when it is finished. As Mark mentions, cash buyers must be pinching themselves. Two years down the line, when the Palm is fully landscaped, the key buildings completed, the monorail running up and down, and bank liquidity back in full flow, people are going to look back at this time in disbelief that it was possible to buy anything on this resort at under AED 2,000 psf. Unfortunately I am not one of those in a suitable cash position, but if I was then I would be having a field day.
ReplyDeleteI can't imagine Warren Buffett is currently hoarding his cash to ride the downturn out....
Due to all of the negative press that real estate markets are currently receiving, potential investors are beginning to forget actually how impressive the Palm Jumeirah is going to be when it is finished. As Mark mentions, cash buyers must be pinching themselves. Two years down the line, when the Palm is fully landscaped, the key buildings completed, the monorail running up and down, and bank liquidity back in full flow, people are going to look back at this time in disbelief that it was possible to buy anything on this resort at under AED 2,000 psf. Unfortunately I am not one of those in a suitable cash position, but if I was then I would be having a field day.
ReplyDeleteI can't imagine Warren Buffett is currently hoarding his cash to ride the downturn out....
I think both Simon and "Ezee Ste" have valid and important points here. Firstly that the Palm is impressive and it is at the centre of new Dubai - Madinat / Marina / Emirates Mall, and even well placed for Jebel Ali and AD... so therefore, in my view, for as long as Dubai has a future as a commercial hub for this area, the Palm will have a real estate market and will take a premium over most other areas of Dubai(hurar!). There is a view being expressed by some that Dubai is 'over' - in which case real estate would be pretty worthless too - but this view to me is typical of the sort of over-reaction that happens in these times. This, in most seasoned commentators eyes, simply will NOT happen and I agree - but any long odds negative possibilty, however remote, does hold fear and fear is a driving factor right now.
ReplyDeleteSecondly, this is a difficult time to keep calm (understandably so - and even I'm frothing at the mouth and reaching for my medication as i write this@!!*!*) but it is usually true that markets do 'over correct' and that the talk is usually far 'worse' than any actual end result.
There is no absolute guarantee that prices will not 'do a Singapore' (and fall by 75% as they did there in the late 1990's) and I think it is important to consider any 'worst that could happen' but again this is extremely unlikley given the fact that the area is almost certain to remain a key hub for both local and global companies - and lets not forget leisure; and hence tangible demand for property will be there once economies start to recover - remember people from all over the world buy here so we don't care who recovers & prospers first!!
There is no way to stop distressed sellers flaunting their ware at drastically reduced prices, and sadly many will have little choice - this is the free economy 'way' - but they do not do themselves or the rest of the property owners any favours. There is no flow of mortgage funds currently so most of the buyers out there cannot buy. But now these 'would be' buyers are seeing prices reduce weekly in the 'papers' and I imagine they will become hesitant about going into the market in any case - as they will want to know prices are at their bottom. There are going to be alot of financially desparate people out there - the only buyers (until mortgages come back on stream) will be (probably hardened) cash buyers who only want to buy if they can negotiate a 'real ridiculously low-to-market' bargain... but there will be folk who have no choice but to take these prices - even if it means taking say 2m AED even if they recently had an asset they thought was worth 3 or 4M AED - 1M then becomes the 'market price' but surely this is ONLY the market price for a brief moment in time when it is 'cash market without a mortgage facility' and when lenders once again have an intent to lend this should quickly start to move prices forward from the bottom - I can see a quick firming of the market once mortgage funds are in place and then perhaps then even seeing a jump of 10 or even 20% from where the 'cash only buyers' and 'desperate sellers' had drove prices down to (or more depending on how far they were drove down)...
In my view, so long as Dubai remains on the 'map' as a regional centre for business and leisure, and everyone here and practically all valued opinions around the globe feel it will, then we can rest assured that the tide will turn, prices will bottom and start to rise, do their 'J' curve; and we could even see this start to take shape as soon as mortgage funds come available - perhaps in the New Year. Hopefully then this will bring about a sense of calm & reason to this dramatic situation that has made many feel as if the world is ending.... and the fact is, when this 'second coming' (of both Dubai & money for mortgages!!) happens, the Palm will once again do better than most other areas in Dubai.. and i feel Dubai will do much better than a majority of markets around the world - so your money may just be in the right place after all!!