What a month it’s been! Since launching my latest venture, AHS Properties, at Cityscape Global 2021, my life has seemed like a nonstop whirlwind of phone calls, messages and meetings.
Not only have I had fun interacting with people from across Dubai’s vibrant property community, but I’ve also had the opportunity to extol the virtues of our emirate’s thriving uber-luxury real estate market.
As you’ve probably guessed, I absolutely love this sector. The problem is that when I’m passionate about something, I sometimes forget that not everyone will share my enthusiasm.
It’s therefore given me pause for thought to find that a small minority of property professionals seem somewhat uncomfortable about the timelines and volumes involved in uber-luxury real estate.
Why is it, I wonder, that a market that excites me so much makes some people feel nervous?
Most of those I’ve been speaking to about my new business appear fascinated by Dubai’s uber-luxury real estate sector, and why wouldn’t they be?
After all, aerial shots of sprawling beachfront villas on Palm Jumeirah seem more at home in a Hollywood blockbuster than inside your average property brochure.
People become even more interested when our discussion turns to AHS Properties’ business model.
The potential yields within this market are extremely attractive from an investment perspective, and certainly have the power to turn heads.
Nevertheless, a minority of real estate professionals become somewhat jittery when our conversation shifts to volumes and project timelines.
I expect renovations on our AED150m Amara Villa at Emirates Hills property, for example, to take upwards four to five months, and I’m perfectly comfortable with this timeline.
When it comes to properties with values of this magnitude, quality is paramount because even the slightest slip in standards could cause a deal to fall through. In this sector, you simply cannot afford to rush.
The need to deliver the very best product that money can buy also means that it would be foolish for any uber-luxury real estate company to spread itself too thin.
AHS Properties has launched with a total asset value of almost AED400m, yet our portfolio comprises just four villas. Even at full capacity, I do not envisage dealing with more than 20 properties at any one time.
In truth, I suspect that’s why this sector makes some real estate professionals nervous. High-quality, low-volume, long-term projects are bound to rattle the nerves of those used to turning around hundreds of units as quickly as possible.
The uber-luxury real estate sector is, in essence, the antithesis of ‘flipping’.
My decision to focus on quality over quantity, both in terms of our portfolio and timelines, is both deliberate and strategic.
AHS Properties is targeting high-net-worth individuals (HNWIs) and, while they may not necessarily be constrained by budgetary concerns, they will nevertheless demand value for money.
And that’s fine with me because I have every confidence in Dubai’s uber-luxury sector. Market confidence has returned following the pandemic and (perhaps because they had to spend more time than they would have liked confined to their apartments during lockdown) many prospective buyers are looking for the type of space only afforded by villas.
Megaevents such as Expo 2020 Dubai and FIFA World Cup Qatar 2022, meanwhile, are attracting millions of new residents to the Gulf, boosting both short- and medium-term demand for luxury properties.
Don’t take my word for it. Just look at the recent Knight Frank report, which found that villa prices in the emirate rose by 5 percent in Q3 2021.
Even more encouragingly, the number of homes worth more than $10m sold in Dubai during the first three quarters of the year was 54, almost doubling the previous record set in 2015.
Dubai’s uber-luxury real estate market is stronger than ever, so I couldn’t have picked a more opportune moment to launch AHS Properties.
In my opinion, our willingness to take our time and do everything properly is going to play a crucial role in our long-term success.
The trust of our customers is our most important asset and, if we can build a reputation for delivering immaculate properties to market, a streamlined portfolio will offer a competitive advantage.
Ultimately, this sector is unlike any other within real estate because you cannot ‘flip’ this type of property. To make it in this market, you need guts, persistence and an unwavering dedication to quality.
So, if you’re only interested in making a quick buck, you’re probably right to be nervous. Dubai’s uber-luxury real estate sector is not for you.
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