Sobha Group, the property developer building the $4 billion Sobha Hartland scheme in Dubai’s Mohammed bin Rashid City, and District One with Meydan Group, plans to double its annual sales volume to Dh2.5 billion by mid-2020, as it consolidates its market position with a view to going public in the coming years.
The developer, which registers around Dh1.2bn of sales per annum at present, also hopes to add another project to its pipeline by the end of this year once a land acquisition deal completes, according to the group’s founder and chairman PNC Menon.
"We're embarking on a consolidation exercise until around the middle of 2020," Mr Menon told The National in an interview in Dubai. "I'm looking at reaching a minimum Dh2.5bn of sales per annum – around 1,200 units each year – within the next two-and-a-half to three years. That's our target for Sobha in the UAE, excluding joint ventures," he said.
“We will be better off this year than last,” he added, referring to sluggish conditions in the UAE property market over the last two years, when residential sales prices dipped by up to 10 per cent in some parts of the country.
The market is expected to bottom out by the end of 2018, with the rate of price decline slowing in many Dubai neighbourhoods over the last quarter of 2017 and high-end residential proving relatively stable.
“There has been a fall in prices but I feel that we’re reaching the bottom,” Mr Menon said. “The real estate industry is always cyclical wherever you are, but Dubai is well-located, well-regulated and property sales are consistent. For the next 10 years at least, I think the market will be steady.”
The group has a land bank sufficient in size to support the next 8-10 years of growth, Mr Menon said, as he forecast “strong double digit growth” for the company in 2018.
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Read more:
Dubai’s prime residential to outperform market as emirate lures ultra-wealthy
Developer Sobha eyeing huge Dubai project, chairman says
Meydan Sobha launches third phase of MBR City District One in Dubai
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The $8.5bn District One scheme near Meydan Racecourse spans a 1,000-acre site and includes more than 600 villas in phases one and two, which are “more or less sold”, the chairman said, adding that phase three could take a further seven or eight years to complete.
The $4bn Sobha Hartland project comprises 344 villas and townhouses over 183 acres, and is due to deliver its first apartment block in June.
Sobha Group is also building the $4bn lifestyle project, Firdaus Sobha, in Umm Al Quwain with the local government and expects to break ground in June.
The developer’s sales target includes a potential fourth UAE scheme that it hopes to bring to market next year. This is a large-scale midmarket scheme in “another area of Dubai” from where Sobha is currently building in Downtown Dubai, though Mr Menon refuses to say where.
He first told media about plans for such a scheme at the end of 2016, revealing the high-end developer’s ambitions to enter the burgeoning affordable housing segment as cost-conscious investors seek cheaper options in a slower market.
“It’s taking a bit of extra time to acquire the land,” he said last week. “We hope to have clarity on this by the end of the year.”
Demand for midmarket residential is bigger than for high-end, Mr Menon explained, and Sobha wants to bring its quality workmanship to smaller-budget buyers.
The potential new scheme will target those with a monthly income of Dh25,000-30,000, whereas existing schemes target earners of at least Dh50,000 per month.
Sobha has no plans to seek further bank financing in 2018. “We are reasonably structured on our finance,” Mr Menon said. However, the group would consider an initial public offering (IPO) in the years ahead to support its growth strategy.
“[IPO] is there are the back of mind,” Mr Menon said. “What is the timeframe, I cannot say, whether it’s three years or five years, as there are certain minimum requirements. It makes sense to hit our sales target first.”
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
ESSENTIALS
The flights
Fly Etihad or Emirates from the UAE to Moscow from 2,763 return per person return including taxes.
Where to stay
Trips on the Golden Eagle Trans-Siberian cost from US$16,995 (Dh62,414) per person, based on two sharing.
UK-EU trade at a glance
EU fishing vessels guaranteed access to UK waters for 12 years
Co-operation on security initiatives and procurement of defence products
Youth experience scheme to work, study or volunteer in UK and EU countries
Smoother border management with use of e-gates
Cutting red tape on import and export of food
Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, (Leon banned).
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
Gran Gala del Calcio 2019 winners
Best Player: Cristiano Ronaldo (Juventus)
Best Coach: Gian Piero Gasperini (Atalanta)
Best Referee: Gianluca Rocchi
Best Goal: Fabio Quagliarella (Sampdoria vs Napoli)
Best Team: Atalanta
Best XI: Samir Handanovic (Inter); Aleksandar Kolarov (Roma), Giorgio Chiellini (Juventus), Kalidou Koulibaly (Napoli), Joao Cancelo (Juventus*); Miralem Pjanic (Juventus), Josip Ilicic (Atalanta), Nicolo Barella (Cagliari*); Fabio Quagliarella (Sampdoria), Cristiano Ronaldo (Juventus), Duvan Zapata (Atalanta)
Serie B Best Young Player: Sandro Tonali (Brescia)
Best Women’s Goal: Thaisa (Milan vs Juventus)
Best Women’s Player: Manuela Giugliano (Milan)
Best Women’s XI: Laura Giuliani (Milan); Alia Guagni (Fiorentina), Sara Gama (Juventus), Cecilia Salvai (Juventus), Elisa Bartoli (Roma); Aurora Galli (Juventus), Manuela Giugliano (Roma), Valentina Cernoia (Juventus); Valentina Giacinti (Milan), Ilaria Mauro (Fiorentina), Barbara Bonansea (Juventus)
THE SPECS
Engine: 6.75-litre twin-turbocharged V12 petrol engine
Power: 420kW
Torque: 780Nm
Transmission: 8-speed automatic
Price: From Dh1,350,000
On sale: Available for preorder now
Tips on buying property during a pandemic
Islay Robinson, group chief executive of mortgage broker Enness Global, offers his advice on buying property in today's market.
While many have been quick to call a market collapse, this simply isn’t what we’re seeing on the ground. Many pockets of the global property market, including London and the UAE, continue to be compelling locations to invest in real estate.
While an air of uncertainty remains, the outlook is far better than anyone could have predicted. However, it is still important to consider the wider threat posed by Covid-19 when buying bricks and mortar.
Anything with outside space, gardens and private entrances is a must and these property features will see your investment keep its value should the pandemic drag on. In contrast, flats and particularly high-rise developments are falling in popularity and investors should avoid them at all costs.
Attractive investment property can be hard to find amid strong demand and heightened buyer activity. When you do find one, be prepared to move hard and fast to secure it. If you have your finances in order, this shouldn’t be an issue.
Lenders continue to lend and rates remain at an all-time low, so utilise this. There is no point in tying up cash when you can keep this liquidity to maximise other opportunities.
Keep your head and, as always when investing, take the long-term view. External factors such as coronavirus or Brexit will present challenges in the short-term, but the long-term outlook remains strong.
Finally, keep an eye on your currency. Whenever currency fluctuations favour foreign buyers, you can bet that demand will increase, as they act to secure what is essentially a discounted property.
Why your domicile status is important
Your UK residence status is assessed using the statutory residence test. While your residence status – ie where you live - is assessed every year, your domicile status is assessed over your lifetime.
Your domicile of origin generally comes from your parents and if your parents were not married, then it is decided by your father. Your domicile is generally the country your father considered his permanent home when you were born.
UK residents who have their permanent home ("domicile") outside the UK may not have to pay UK tax on foreign income. For example, they do not pay tax on foreign income or gains if they are less than £2,000 in the tax year and do not transfer that gain to a UK bank account.
A UK-domiciled person, however, is liable for UK tax on their worldwide income and gains when they are resident in the UK.
The language of diplomacy in 1853
Treaty of Peace in Perpetuity Agreed Upon by the Chiefs of the Arabian Coast on Behalf of Themselves, Their Heirs and Successors Under the Mediation of the Resident of the Persian Gulf, 1853
(This treaty gave the region the name “Trucial States”.)
We, whose seals are hereunto affixed, Sheikh Sultan bin Suggar, Chief of Rassool-Kheimah, Sheikh Saeed bin Tahnoon, Chief of Aboo Dhebbee, Sheikh Saeed bin Buyte, Chief of Debay, Sheikh Hamid bin Rashed, Chief of Ejman, Sheikh Abdoola bin Rashed, Chief of Umm-ool-Keiweyn, having experienced for a series of years the benefits and advantages resulting from a maritime truce contracted amongst ourselves under the mediation of the Resident in the Persian Gulf and renewed from time to time up to the present period, and being fully impressed, therefore, with a sense of evil consequence formerly arising, from the prosecution of our feuds at sea, whereby our subjects and dependants were prevented from carrying on the pearl fishery in security, and were exposed to interruption and molestation when passing on their lawful occasions, accordingly, we, as aforesaid have determined, for ourselves, our heirs and successors, to conclude together a lasting and inviolable peace from this time forth in perpetuity.
Taken from Britain and Saudi Arabia, 1925-1939: the Imperial Oasis, by Clive Leatherdale
The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
US households add $601bn of debt in 2019
American households borrowed another $601 billion (Dh2.2bn) in 2019, the largest yearly gain since 2007, just before the global financial crisis, according to February data from the New York Federal Reserve Bank.
Fuelled by rising mortgage debt as homebuyers continued to take advantage of low interest rates, the increase last year brought total household debt to a record high, surpassing the previous peak reached in 2008 just before the market crash, according to the report.
Following the 22nd straight quarter of growth, American household debt swelled to $14.15 trillion by the end of 2019, the New York Fed said in its quarterly report.
In the final three months of the year, new home loans jumped to their highest volume since the fourth quarter of 2005, while credit cards and auto loans also added to the increase.
The bad debt load is taking its toll on some households, and the New York Fed warned that more and more credit card borrowers — particularly young people — were falling behind on their payments.
"Younger borrowers, who are disproportionately likely to have credit cards and student loans as their primary form of debt, struggle more than others with on-time repayment," New York Fed researchers said.
