With five new projects at various phases of development,  Union Properties (UP) is now planning and carefully studying the possibilities of creating further investment avenues in Dubai. 

In an exclusive interview with Gulf Construction, Simon Azzam, CEO, comments on one of the most vibrant construction markets in the world and UP’s growth in the emirate:

GC: The response to UP’s open house for the launch of five new projects has been overwhelming. To what do you attribute this?
SA: The response exceeded our expectations. Our track record has been a strong assurance for investors to join us in our bid to develop the economy of the emirate and build Dubai into one of the most modern property investment hubs in the region. We have launched these five, which should be complete in one to three years. We have many more in the pipeline, which will be launched once the study of feasibility is completed.
Dubai has grown at an incredible rate during the past few years, and so has the number of people entering the emirate. This is a clear indication that a lot more projects are needed to satisfy the growing demand but on the other hand all these growth indicators are a word of caution for developers.
We at UP are more careful in maintaining the quality and the image of the property as this reflects on our credibility which we have built over the years with sheer hard work. We are keeping pace with the changes but in an educated and careful manner. UP has this policy of studying every single project from every aspect well before it is launched.

GC: What is your definition of a successful project?
SA: A successful project is the one which is built, bought, occupied and people actually enjoy living in them. This is what we call a success, when the full cycle of design, construction, selling and occupation is combined with happiness. To us, it is more than mere building and selling.

GC: What are the strengths of UP?
SA: UP has been in the market for quite some time and we have a good idea of the market requirements and we build to match these demands. To meet people’s requirements, we not only look at the details of the house, from the architectural point of view but also the interiors and the materials used and the overall environment around the development. We are involved from start to finish. We don’t leave it up to the design team. We work and guide them in each and every element of the design and get the desired results.
 
GC: Dubai has been growing at a phenomenal rate.  How long do you think this will sustain?
SA: We expect this growth to continue for another 10 to 15 years and are surely in the race to build the ‘Future Dubai’ that exceeds even the wildest imagination. Sustaining our leadership position requires a whole system of conceptualizing, studying, planning, marketing, executing and selling a project. We have been able to work these processes very well and the success of Green Community is proof of that. It is the same recipe we are trying to apply on each and every UP property.
We have a department for market research that constantly monitors the market and provides us valuable data as regards to new trends, demands and market expectations, giving us an indication on what we have to target.

GC: How has UP fared in the property market?
SA: The figures speak for themselves. UP boasts of 100 per cent occupancy rates, both in ownership and rental projects. 

GC: To what factors do you attribute the hike in the property prices?
SA: There was no sale of property in Dubai three years ago. Properties were fairly priced initially and people jumped on this new investment opportunity. The demand factor at a later stage did the correction and rationalised the pricing structure over a period of time.
We are in a free market mechanism where people are buying from second and third buyers on substantial premiums. Under the circumstances, no developer would build a project and price it less than what the market rate is dictating.
The construction boom in Dubai has put a lot of limitations in terms of availability of raw materials, quality contractors, etc. There are many factors which could delay a project and that delay is calculated in terms of cost for the construction industry. Obviously, the cost of construction is much higher now than what it was when we had a normal growth pattern.
I think there would be another price correction in, say, about three years’ time. There are many properties that have been sold but not occupied and there are plenty coming up. When all these properties will be ready for occupation, the market will see another correction but all of it depends on investor perception and the quality of development.

GC: What about developing affordable residential properties?
SA: Dubai offers several properties to the middle and the high-income groups. The five projects launched by UP are targeting both these groups. While Park Lane and One Central Park Apartment are going to be exclusive apartments with higher standards, we also have Mirdiff and the Green Community West with affordable villas, studios and one-and two-bed apartments.
The price in Mirdiff should be around Dh650 to Dh750 per sq ft while in up-market projects it would range between Dh2,000 and Dh2,500 per sq ft.

GC: How do you see Dubai and UP in the long term?
SA: There would be unimaginable changes in Dubai’s skyline one decade down the line and UP intends to be a major player, focusing on its residential, commercial and retail projects. We will continue to develop projects to meet the market demands and to be an integral part of Future Dubai.