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UAE Property Three Times Better than Money in the Bank

Dubai, UAE: The rental returns on premium real estate investments in the UAE are at least three times higher than having cash in the bank according to the Middle East's largest private developer, DAMAC Properties .

The rate of interest on a six-month fixed term deposit at HSBC is 2.1%, compared to rental yields in the UAE of between 7-12%, according to property consultancy CB Richard Ellis.

"Rental yields are extraordinarily high in the UAE, compared to most other countries around the world. Now that prices have stabilised in premium locations, the high yields make investing in the UAE property market an attractive proposition for any global investor" said Niall Mc Loughlin, Senior Vice President of DAMAC Properties .

Another important factor for investors to consider is the favorable tax environment in the UAE. Rental income is tax free, and there are no capital gains taxes levied on the sale of properties.

"The rental yields alone are attractive for investors, and coupled with the tax-free investment landscape, property in the UAE is an extremely attractive asset class for any investor, anywhere in the world" said Mc Loughlin.

Since the beginning of the year, DAMAC Properties has seen a marked increase in sales and enquiries from foreign investors in particular.

"Over the past couple of years the market has been dominated by end users, but we are now seeing a return of the investors. However, unlike the peak of the market in 2008, they are not chasing capital growth; they are focusing on rental yields. It's a very different market dynamic" Mc Loughlin added.

The positive sentiment is shared by real estate advisory firm, Cluttons, which predicts good quality; well-established developments will continue to do well at the expense of newer residential areas. The firm also anticipates the residential market will continue to gain from increasingly available mortgage finance options at competitive rates.

"Investors are coming back to the market, not because they think the price of their property will double in a matter of months, but because they are comfortable with consistent, sustained and globally competitive rental returns" Mc Loughlin pointed out.

DAMAC Properties is experiencing the strongest demand in three years across its range of premium developments at Dubai Marina, Downtown Dubai and the DIFC. There is a strong flight to quality in both Dubai and Abu Dhabi, as existing residents seek to upgrade and new buyers aim to take advantage of market conditions which currently offer extraordinary value for money.

"The UAE real estate market has become increasingly fragmented which means there is little benefit in reviewing the market as a whole. We are now seeing demand and prices rising convincingly in premium locations within Dubai, but these price gains are to some extent being offset by price declines in some of the Emirate's less sought after locations, such as International City" said Mc Loughlin.

The developer is also extremely optimistic about the prospect for strong rental yields in the hospitality sector. DAMAC Properties is strategically focused on the serviced apartment development model, with construction continuing at pace at its 'Burjside Boulevard' project in Downtown Dubai, overlooking the Dubai Mall and Burj Khalifa.

"We've seen extremely strong interest in this particular project in 2011 and we expect that to continue in 2012. Once our Burjside Boulevard serviced apartments are handed over to customers, we anticipate rental yields above 15 per cent" commented Mc Loughlin.

DAMAC Properties is an internationally recognised, luxury-focused, high-end developer. With a proven track record for delivering some of the most luxurious residential properties across the Middle East region, the developer is well capitalised and has the vision and momentum to provide solid investment opportunities for customers across all the markets in which it operates.

Further information is available at www.damacproperties.com

DAMAC Properties was established in 2002, as a private residential, leisure and commercial developer in Dubai and the Middle East. Since then, DAMAC Properties has expanded rapidly into North Africa, Jordan, Lebanon, Qatar and Saudi Arabia.

DAMAC Properties has completed 36 buildings to date with 7374 units and spanning 13,132,484.00 sq feet with projects in Dubai such as The Crescent and Lago Vista at IMPZ, Executive Heights and Smart Heights in TECOM, Park Towers in the DIFC, Lake View and Lake Terrace at Jumeirah Lake Towers, Business Tower and XL Tower at Business Bay, Emirates Gardens and Tuscan Residences in Jumeirah Village and Ocean Heights, The Waves and Marina Terrace at the Dubai Marina.

DAMAC Properties also has a further 50 buildings at various stages of progress across the Middle East, North Africa region. These consist of 9849 units, spanning 16,886,151.00 sq feet.

In June 2010, DAMAC Properties further reinforced its position as a premium developer with the launch of DAMAC Tower in Beirut, Lebanon. A 28 storey iconic tower, this project is in association with Italian design group, VERSACE, with all interiors being designed by Versace Home. This was followed by the DAMAC Residences with Interiors by Versace Home, launched in Jeddah, Saudi Arabia in June 2011.

The company's projects are located in the most desirable and exclusive locations and are built to the highest quality specification that has become synonymous with the group. DAMAC Properties ' develop projects that include residential, commercial and leisure facilities that create an integrated community.

In addition to support services provided by the Dubai headquarters, the company's comprehensive Customer Care Program provides solutions through its vast network with offices in the UAE, Jordan, Lebanon, Egypt, KSA and Qatar.

Further information is available at www.damacproperties.com

For more information please contact: Niall McLoughlin, Senior Vice President - Corporate Communications, DAMAC. Tel: +971 4 04 3732190 │ Fax: 00 9714 3732335 │Mobile +971 50 6531824. emaiI: niall.mcloughlin@damacgroup.com

Parisa Ansarian / Tameem Alkintar, ASDA'A Burson-Marsteller, Dubai, UAE
Tel: 971-4-4507600 │Fax: 971-4-4358040 │Email: p.ansarian@asdaa.com
/ t.alkintar@asdaa.com

© Press Release 2012