Sunday, Sep 02, 2012

Abu Dhabi: Aldar Properties PJSC, Abu Dhabi’s largest property developer, is planning to develop low-cost housing as part of its plan to meet demand in all aspects of housing needs in Abu Dhabi, a senior official said.

In an exclusive interview with Gulf News, Mohammad Khalifa Al Mubarak, Aldar’s chief commercial officer and deputy chief executive officer, said the company were looking at all aspects of housing needs, including affordable and low cost housing.

He said: “We have embarked on a number of real estate projects towards meeting these needs as housing demand is picking up in Abu Dhabi. In Yas Island itself, Aldar will develop properties for UAE nationals and expatriates.”

The company, which last year received a total of Dh36 billion government funding in two tranches last year, has bounced back with strong results.

Aldar has repaid Dh4.3 billion debts from January to June this year, including the early retirement of Dh1.9 billion term loan as its debt-reduction programme continues. This brings total borrowings down to Dh14.35 billion in June 2012 from Dh18.29 billion in December 2011.

“We have informed all our creditors and banks that we will meet all our debt obligations in time,” he said, stressing that the company is in a much better financial shape due to increased number of deliveries and construction works that are progressing well.

“The worst for us, is over,” he quipped.

Aldar has recorded a 497 per cent jump in revenues to Dh4.6 billion during the second quarter of 2012, up from Dh775 million recorded in the corresponding period last year while net profit increased 228 per cent to Dh417.9 million up from Dh127.3 million during the same period last year.

Revenues were driven by the successful handover of 1,058 residential units on Al Raha Beach units, the company said.

At the end of June 2012, cash balances were Dh2.45 billion and Dh3.2 billion of available liquidity from the credit facility with National Bank of Abu Dhabi, providing the Company with ample working capital and liquidity to deliver on its business plan.

“Apart from that, we are going to deliver the first phase of the Al Bateen Park project in September, where all the apartments have been sold out and the villas are 94 per cent sold out,” he said.

Aldar’s delivery programme will continue into the second half of the year with a focus on delivery and handover of the remaining units and land plots at Al Raha Beach, it said. The development at Al Ward, the precinct of Al Raha Gardens is now fully pre-sold. Both Al Bateen Park and Al Ward are scheduled for delivery in Q4 2012.

Aldar have also scheduled a number of retail facilities for completion in the next two years, including the World Trade Centre Mall and Yas Mall. Both will provide the company with a solid revenue stream, backed by income from leisure facilities such as the Ferrari World theme park and the yet to be opened Yas Waterworld.

At Yas Mall, Aldar’s 233,000 square metres flagship retail development on Yas Island, considerable progress has been made on construction with the installation of underground utilities in progress and the ground level floor slabs underway. The project remains on schedule for delivery in Q4 2013 and pre-leasing is at 60 per cent.

The Village Retail development for the residents of Al Falah is on schedule for completion in Q4 2012 and joins other community retail facilities owned by Aldar, such as Gardens Plaza in Al Raha Gardens and the Al Raha Beach amenities.

The move comes following the Abu Dhabi Government’s quest to develop a balanced housing portfolio that will accommodate people of all income groups.

To ensure the delivery of affordable housing to middle income earners, Abu Dhabi’s Urban Planning Council (UPC) is implementing a policy to secure a supply of middle income rental housing. The policy requires 20 per cent of the residential gross floor area (GFA) in multi-unit residential buildings within developer-led planned developments to be developed and managed as middle income rental housing.

“This policy supports the high level objective in Abu Dhabi Plan 2030 of developing a range of housing types and an adequate supply of affordable housing to meet the needs of Abu Dhabi’s diverse population and lifestyles,” said a UPC spokesperson.

“The UPC considers the provision of quality affordable housing to be an important component in the long-term strategic development of Abu Dhabi and the creation of a world-class emirate. Affordable housing is a necessity that improves liveability and economic efficiency and creates a sense of place for residents.”

Abu Dhabi’s real estate sector is becoming more competitive as a large number of high-quality projects are delivered across all sectors, said a recent report by Jones Lang LaSalle.

“The real estate market in the UAE is quite fragmented,” said Matthew Green, Head of Research and Consultancy, UAE at CB Richard Ellis Ltd, Middle East. “For Abu Dhabi the development cycle is significantly behind Dubai, with the capital only now reaching the peak of it development cycle. As new supply emerges we expect to see further deflation of sales and leasing rates, although this will be moderate compared to the declines that we have seen during 2009 and 2010, at the peak of the market downturn.”

By Saifur Rahman Business Editor

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