(MENAFN- Khaleej Times) The Sharjah government's decision to open up property investment in the emirate to expatriates from all around the world was a momentous one in 2014. There has been no looking back since, with various master developers rolling out mega projects to tap the reasonably priced real estate market.
A case in point is the Dh2.4 billion Tilal City project launched in 2014 on Emirates Road close to the Al Dhaid Interchange in Sharjah. Tilal City comprises approximately 1,855 land plots and allows investors to build units for sale, lease and personal use.
Arthur Mackenzy Properties Group (AMPG), a sub-developer in Tilal City, is offering lucrative investment opportunities at attractive price points. It is selling entire residential buildings in Tilal City for Dh5 million each. This is a compelling investment proposition since you can buy an entire building in Sharjah for the price of an apartment or villa in Dubai.
"The master developer of Tilal City started selling plots in 2014. We recently acquired plots from them and are selling full buildings to investors. We are targeting investors who are not keen to go through the hassle of developing plots by themselves. We are giving them full buildings with expected rental returns of 10 to 12 per cent," says Shaher Mousli, CEO, Arthur Mackenzy Properties Group.
Each building comprises 12 one-bedroom apartments and 12 parking spaces. The average price per square foot for these buildings is around Dh450. The developer even tailor-makes buildings by tweaking unit specifications for clients who intend to become end-users.
All utilities and infrastructure are in place in Tilal City. "The master development is complete, with infrastructure, sewage system, gas pipes, electricity and fibre optics in place. An investor is not buying a building in the middle of a desert with construction all around," the CEO observes.
AMPG aims to sell 100 such buildings by the end of 2018 and 400 buildings in the next three years.
The buildings are expected to generate rental yield in excess of 10 per cent for investors. "Ten per cent net returns is a conservative outlook, looking at the lowest rental denominator for a one-bedroom apartment over the past seven years in Sharjah. Tilal City is a semi-government project and has no service charges as the emirate's Municipal Authority maintains the development," adds Mousli.
AMPG promises to finish construction of the buildings in two years and has attractive payment plans to offer buyers. The developer is currently negotiating profit rates with an Islamic bank for mortgage buyers. The plan is likely to involve paying 35 per cent during construction and the balance amount across 10 years after handover.
"For cash buyers, we have a three-year payment plan. They can make 80 per cent of the payments linked to construction milestones during two years and 20 per cent across one year after completion. Our management unit can rent out the full building and the investor can pay the final 20 per cent with the rental returns," explains the CEO.
Eighty per cent of buyers in AMPG's buildings in Tilal City are UAE nationals, followed by some Pakistani and Indian investors.
"People who previously purchased from Tilal Properties are approaching us to develop buildings on their plots. We want the city to come alive as soon as possible," says Mousli.
Tilal City is also home to what is going to be Sharjah's largest retail and leisure destination - Tilal Mall. "The Tilal Mall will cater to the 50,000 residents living in the catchment area of Tilal City. There will be a lot of demand for occupancy in our buildings," reckons the CEO.
Tilal Properties has signed an agreement with the Hilton group to operate a five-star DoubleTree by Hilton Sharjah Tilal Mall. The new hotel will adjoin Tilal Mall and open in 2021.
In terms of connectivity, Tilal City is only two kilometres away from the Dubai border and a 28-minute drive during rush hour to Business Bay, insists the chief executive. "We offer connectivity to one of the biggest business hubs in the world in less than 20 minutes for an affordable price," Mousli adds.
US portfolio
Arthur Mackenzy also offers property investment opportunities in North America, with a special focus on the state of Michigan.
"The ticket price for our US properties start from $50,000 to $60,000. You can buy a villa on a 5,000 sqft plot with a tenant for Dh250,000 or Dh300,000. All our properties in the US generate 10 to 14 per cent net returns," says the CEO.
Buyers of these properties are expatriates from the GCC, India and Pakistan. "We have been selling US properties in the UAE since 2010. You can sign a five-year management agreement with us and collect the rental proceeds from our Dubai office."
AMPG embarked on its property portfolio from Sharjah almost 20 years ago and moved into the development business in 2012. It has developed a project in Jumeirah Village Triangle in Dubai and has an ongoing one in Business Bay as well.
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Deepthi Nair I cover all things related to real estate in the UAE. Working as a print journalist in Dubai since 2008, I have reported on all the flashy new projects in town. Dubai's passion for setting new records continues to amaze me. I love to do stories that strike a chord with the average expatriate in the UAE. If you have any news related to your community or rents, you know who to get in touch with at Khaleej Times. When I am not working, I travel, catch up with friends, mall trawl, catch up on movies, explore new places in town or just unwind in a spa. Originally from India, I have been a journalist for more than 11 years. Language has been my forte right from school. That's me in a nutshell
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