Taiwanese developer Farglory has said that sales of apartments at its Maryah Plaza project on Abu Dhabi’s Al Maryah Island will resume in the third quarter of this year, ahead of the project's "substantial completion" due at the end of the year.

Farglory Group Middle East's managing director Jack Hu told Zawya in an interview at the company's offices facing the development in the Abu Dhabi Global Market Square that he expects the first residents in the much-delayed project to move in during the first quarter of 2019.

The company had initially bought the plot that was due to house the four-tower $1 billion Maryah Plaza project back in 2010, which Hu described as "a different world" in terms of the state of the real estate market.

The project was meant to contain four towers - one hotel/office building, and three luxury apartment and serviced apartment buildings - but Hu said that given the current climate it is unlikely that the remaining three will be built out any time soon.

"At the moment, there's no visible planning (for future phases)," he said. "As you know, the whole region has been impacted quite severely by the low oil price and we don't know whether there's going to be the market to absorb," he said.

About 20 of the 220 units in the tower had been sold before the developer recommenced work on the project two years ago, after reworking the project with a view to making it more affordable.

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Farglory/handout via Thomson Reuters Zawya

The building, which was designed by architect Richard Rogers, was originally priced at 3,750 UAE dirhams ($1,021) per square foot but after modifications were made, including the addition of more one- and two-bedroom apartments, prices were reduced to 2,500 dirhams per sq ft.

However, Hu said the developer had halted sales on the project by the time it appointed Abu Dhabi-based Al Fara's General Contracting to restart work in September 2016.

"We saw that the market was very soft so we decided to debut that getting closer to completion, so that people... experience what is this very exclusive product."

The tower is due to top out next month, and interiors work is already underway on the lower floors.

"The show floor is almost done," Hu said. "We've had a lot of enquiries, but we're deciding when we want to open to the public. As of now, no exact date has been decided."

He added that sales were likely to begin "as soon as maybe third quarter, latest towards completion".

Despite the fact that the residential market is now even softer than when the company halted sales, Hu said that he was confident of being able to sell units in the scheme "because this sector has never been served before".

"This market never had this kind of product," he said.

Little competition

He argued that although many developers in the United Arab Emirates brand their projects as 'ultra-luxury' developments, there are only a few projects in the market that would meet international expectations of this standard. "We don't see any that exists right now in the Abu Dhabi market," he said.

He argued that in Dubai, only Burj Khalifa met that standard, but added that a number of projects which had completed within the past 12 months could fairly be described as 'luxury'.

"In my view, in Dubai at the moment, even today, I think it's less than five projects," Hu said. "And the rest are more middle-income in international standards."

Yet even at the reduced price of 2,500 dirhams per sq ft, Maryah Plaza's apartments will be priced substantially higher than most existing schemes in the city.

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Farglory/handout via Thomson Reuters Zawya

According to real estate consultancy Cavendish Maxwell's Property Monitur database, the most expensive units currently on the market are at Saadiyat Beach Residence, which sell for an average of 1,580 per sq ft, although the firm's associate partner Manika Dhama said that some branded residences linked to hotels such as the Four Seasons Private Residences (also on Maryah Island) and the Fairmont Marina Residences (Marina Village) can sell for between 2,100-2,600 dirhams per sq ft.

Buyers of these units are all typically from the UAE or the wider Gulf market.

"Investor activity in Abu Dhabi continues to be driven by Emirati buyers, with limited owner-occupier activity from expatriates," Dhama said in an emailed response to questions from Zawya.

"Larger units are facing greater occupancy pressure from weakened demand as job insecurity continues in the emirate, especially for C-level executives," Dhama continued.

She said that although there is a "very niche segment for this kind of product", its exclusivity means that off-plan sales tend to be slower.

Farglory's real estate development and construction arm is listed on the Taiwan stock exchange and last year reported a net profit of just over 2 billion Taiwanese dollars ($67 million) on sales of 18.6 billion dollars. According to its website, the company has developed more than 600 projects with a total floor space of more than 23 million square metres (247.5 million sq ft).

Although the company is unlikely to develop more luxury real estate in Abu Dhabi in the short-term, Hu said it had been approached by local investors about the potential to build science parks and more affordable homes - both of which it has experience of building in Taiwan.

"We got quite a number of invitations asking us to look into the mid-market and affordable (homes)," Hu said. "That's where we excel in our home turf."

(Reporting by Michael Fahy; Editing by Shane McGinley)

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