News Desk
DUBAI: Leading Dubai developer Binghatti Properties is embarking on a portfolio expansion that will almost double the size of its portfolio within the next 18 months to AED 100 billion, compared to the current AED 40 billion. This comes after Binghatti had recently displayed strong performance in the market in the first half of the year.
Muhammad Binghatti, the Chairman of Binghatti Properties, commented recently to the media in Dubai, stating that his company which has recently partnered with global brands including automotive legends Bugatti and Mercedes-Benz, as well as horology and jewelry brand Jacob&Co. is planning to launch 12,000 units within the next three months. This is in tandem with the developer receiving cashflows from projects that will be handed over during the next three months with a value exceeding $ 1 billion (AED 3.67 billion).
Binghatti stated that Dubai is deemed one of the most significant real estate investment destinations all over the world, and its booming market is characterized by continuous growth, and offers investors various investment opportunities. “Dubai’s properties continue to appeal to end-users and investors as the average price per square foot is about $ 352 only, despite the latest hikes, which is equivalent to one third of its counterpart in London at the end of the last year which sat at $ 868. Dubai’s average price per square foot was also equivalent to less than half of its counterpart in Singapore sitting at $ 765, and slightly higher than half of the average price in Los Angeles at $ 663”, Binghatti said.
“It is not only about the attractive prices, Dubai also offers diverse exceptional services & facilities everywhere, like airports, hotels, and restaurants. For example, the check in and airport control procedures are significantly smoother and uncomplicated. There is also consideration for social security and comfort through the availability of female taxi drivers dedicated to families and female passengers. These factors combined enhance the quality of living, invigorate the market, and positively impact real estate prices”, he added.
Binghatti noted that the company recently increased its activity in land expansion with plots purchased in strategic districts of Dubai including Palm Jumeirah, Business Bay and Al Jaddaf. “The land bank owned by the company is aimed to fulfill the expected demand for approximately two and a half years as we continuously seek to enlarge our land portfolio”, Binghatti clarified.
Regarding the plans of expansion outside Dubai, Binghatti opened an international office in Riyadh, establishing a presence in the KSA market.
“Our most important goal is to do our best as a company. In that capacity, we care about handing our projects over in time, and sometimes before their deadlines. We have been awarded by the government of Dubai’s Land Department, as the fastest real estate developer. We deliver on time while simultaneously focusing on quality and harnessing technology in the real estate sector. Our focus on quality is made possible through our vertically-integrated business model in which our steel, joinery and aluminium factories service the manufacturing work across our projects, further ensuring that value is delivered to end-users and investors.”, Binghatti stated.
“There are various factors considered when evaluating prime real estate. The main factor is the location of the project, and the brand value it carries. An example of this is our partnership with Bugatti, one of world’s leading automotive brands. The Bugatti Residences by Binghatti features the only riviera-inspired beach in the area and a private car lift that enables clients to park vehicles in their very own penthouses.”, he stated.
Muhammad Binghatti mentioned the company’s program for buyers of limited budgets, and highlighted the fact that Dubai not only offers uber-luxury real estate products but also mainstream real estate products. In fact, he mentioned the possibility of renting a studio in Dubai for $ 1000. “You can rent a studio for AED 45000 annually in Jumeirah Village Circle. Alternatively, if you want a neighbourhood with more lifestyle and amenity offerings that is closer to the city, you can rent in Business Bay at AED 65000. The same applies to the restaurant and café sector too: you can get a meal for AED 10 only, and you can also buy a meal in an extravagant restaurant at AED 2000 or AED 2500”, he elaborated.
“In this context, Binghatti’s presence in all segments of the market, be it mainstream, luxury or uber-luxury plays a role in ensuring our products are available for all”, Binghatti added.
He highlighted the fact that $ 1 million (AED 3.67 million) can buy approximately 1000 square feet in three of the most prime locations in Dubai, while the same amount secures 172 square feet only in Monte Carlo, which is equivalent to only 20% of the value gained in Dubai. “Dubai offers one of the best value propositions in the world, if not the best overall”, Binghatti confirmed.
“The real estate market in Dubai maintained a rental yield rate of 7%- 10%, compared to levels in London at about 3%”, he continued.
He praised the Sukuk listing Binghatti recently issued and highlighted that the debut issuance was 210% oversubscribed, while the tap that followed was 420% oversubscribed, recording 40% international demand from outside the UAE. “The high demands for subscription reflect the trust of global investors in the economy of the UAE and Dubai, and in our performance as a company, and the reputation of “Binghatti Properties” abroad”, Binghatti said.
He was asked if the company has any plan for and IPO. “Our company is a private family business, and has no plans for IPO in the foreseeable future, particularly that our cash flows are solid.”, Binghatti answered.
He spoke on Emiratization and described it as a national duty that his company must carry. “My instructions to the human resources department in the company reflect this obligation, as my goal is to make “Binghatti Properties” the biggest private incubator of worthy UAE talents. We have brilliant youths with excellent mentalities who have a passion to learn. Even the people with no experience want to learn and have the will to do so. Hence, they deserve opportunities. We are well in to the Emiratization endeavor, and remain fixated on the target, which is not only to increase the number of local staff, but also to implement programs in this regard.”, he emphasised. “We are amongst the first companies to launch programs for stimulating UAE real estate brokers, particularly with the new cohort of the real estate regularization program’s graduates. We encouraged graduates and even offered higher commissions in an effort to encourage their activity and participation. This proved fruitful as many participants manged to sell in our project “Binghatti Hills”, which marked the launchpad of their career in real estate brokerage”, Binghatti concluded.
