As the largest group of expat real estate investors in the UAE, Indians maintain very strong relations with developers across in the country. A new initiative aims to take that relationship to a whole new level and open the UAE to a much bigger group of powerful Indian investors. Aurum Real Estate is leading the novel move to promote real estate investment prospects in the UAE to the lucrative Indian market by bringing a group of brokers from Greater Mumbai to Dubai. Collectively called The Real Estate Kings (Trek) Group, the Indian delegation was given a tour of major development sites and an overview of the emirate’s real estate market.
Mahendra Singh, chairman of Aurum Real Estate, says the initiative has created a huge exposure for Dubai real estate among prospective buyers in India. Although Indians have been the top expat market for Dubai real estate, he says a lot more potential buyers are unaware of the opportunities available in the emirate. Delivering information and creating awareness through the Trek initiative, he says, is a powerful tool to unlock market potential.
“Indians like to purchase property in this emirate not for livelihood but for the status of having a property in a popular city such as Dubai,” says Singh. “Moreover, the rental yields in the emirate are much higher than properties back home, and the liquidity ratio is greater, as property sells faster here than in India. Also, the upcoming 2020 event further adds to the city’s appeal.”
Singh says the implementation of the Real Estate Regulation Act (Rera) in India last month is limiting investment prospects, prompting investors tap into foreign real estate investment markets.
“Property development in the country is more controlled [as a result of Rera],” says Singh. “In Mumbai, development has slowed down because of the new municipal rule that is enforced, which will not grant permission for any new development until 2019, to resolve the issue of excessive dumping in the city. The market condition back home gives an opportunity for Dubai property, as Indian investors and businessmen can now consider deploying their funds in Dubai. However, these buyers prefer to transact only with the brokers they know and have trusted for several years, therefore, partnering with Trek made sense to capture this segment.”
Market trend
Having operated in Dubai’s real estate market for over a decade and having seen the highs and lows of the market, Singh believes Dubai connects with investors for being a safe and secure investment destination and attractive return on investment. However, he says a trend that started 2015 is seeing more end users in the market. “I have seen three classes of buyers since the freehold market started. First, the initiators came, then the followers and now the third segment are entering — the masses,” he says.
While many Dubai developers now cater to a much broader cross-section of the market, Singh says brokerages should also take a more proactive role in creating awareness about the market, particularly among end users.
“Like most brokerages, I visited India to meet buyers in various cities. I met the same set of investors that I had interacted over several years, however, I adopted a new strategy of collaborating with reputed and trusted brokers from back home. I looked for ways to identify them and that is when I learned that there are qualified dealers’ bodies across all cities in India and then got introduced to a credible agents association called Trek.”
The initiative
A five-day Dubai study tour that started on April 22 was jointly organised by Trek Mumbai and Dubai-based Aurum Real Estate.
“We visited the sales orientation centres and project sites of eight developers in Dubai,” says Avinash Khater, chairman of Trek. “These were Al Habtoor City, Cassia at the Fields of G&Co, Jumeirah Islands of Nakheel Properties, Grand Views Villa of G&Co and Dubai Hills and Downtown Dubai of Emaar Properties.
“The other developers were Gemini Group in Meydan, Sobha Developers’s Sobha Hartland, Azizi Developer’s projects on the Palm Jumeirah and Al Furjan and Ellington’s Belgravia 1 and 2 and Eaton Place in Jumeirah Village Circle, RP Heights in Downtown and DT1 in Downtown. We visited as a group of 53 agents’ from Trek and Aurum as our channel partner in Dubai facilitated the warm reception from Dubai’s property developers.”
Trek is an association consisting of 69 members come from Mumbai’s main regions or highly transacted areas along with Thane and New Mumbai, collectively known as the Mumbai Metropolitan Region (MMR) or Greater Mumbai.
“Each of these members is a ‘King’ in their own right, doing a business turnover of approximately of $18 million per year in their respective portfolios. Each King has a minimum 10 years experience in the property business, and the Kings cover all the verticals and business areas of the real estate industry,” says Khater.
Khater says his peers have been facing various challenges in Mumbai, which has encouraged them to look for new opportunities elsewhere. “We come from Mumbai, where property prices are very expensive, compared to the quality of the product that is offered,” says Khater, adding that the availability of land for development has been a major obstacle. “In Mumbai, we are not paying for the land, we are paying for the lack of it.
“There is a deficiency of land, so the prices of real estate are very high. In Dubai, there is a huge supply of land and developments here are of very good quality. For $1 million, the quality of the property that a buyer gets in Dubai would be five times better than what the buyer would get in India. Hence, we are bullish about getting sales enquiries from the expansive customer database of all our Trek members and their respective associates.”
In April, Aurum conducted a private event in Mumbai in collaboration with Trek, showcasing upcoming and current prospects in Dubai’s real estate market.
“I felt it would be better if Trek could see and connect them with the city, so I invited them to come over and experience the robustness of the market themselves,” says Singh. “By the last week of April, they visited the emirate and met both the government-backed and private developers in Dubai.
“I wanted them to visit as many projects as possible, so they will be aware about Dubai and will be equipped to reach out to their clients as our channel partners. Our association with Trek will act as a one-stop brokerage between both sets of buyers, wherein when they have any customer enquiry for Dubai, it will be routed through us, and if we have any enquiry for the suburbs of Mumbai, that will be routed through them.”
