(MENAFN- Khaleej Times) Developers are expected to ramp up construction on 136 ongoing development projects in Dubai ahead of Expo 2020 to deliver at least 25 per cent more residential units this year, says a report.
Latest report compiled by Property Finder shows that at least 48,015 freehold residential units in Dubai are under construction and expected by Expo 2020. Experts said up to 40,000 residential units are likely to be delivered in Dubai this year compared to 29,000 handed over in 2018.
Jumeirah Village Circle (23) and Mohammed Bin Rashid City (15) are likely to see the highest number of projects under construction ahead of six-month long mega event, starting on October 20, 2020. Dubailand and Business Bay will also see a lot of activity, with 12 projects apiece likely to be completed.
"Construction is not slowing down and projects are in full swing," Lynnette Abad, director of Research and Data, Property Finder, said.
In past five years (2014-18), developers added 85,100 freehold residential units in Dubai market, which currently stands at 528,757 units. They added 8,400 lowest number of housing units in 2015 and 29,000 highest number of units in 2018 as more projects entered into completion stage.
"We are also starting to see phases of big projects near completion status, therefore we can expect to see a higher number of completed units this year compared to following years. So far to date, there has been a total of 10,670 units completed this year," she said.
Francis Alfred, managing director and CEO of Sobha Realty, said Sobha has been a firm believer in the long-term potential Dubai has to offer.
"We are committed to the broad vision Dubai has for Expo 2020 and are well placed to make the most of the opportunity it will offer," Alfred said
"With Expo 2020 nearing and related infrastructure projects taking final shape, Dubai economy is poised to reap the benefits of the stimulus that the event promises. With 25 million expected visitors and multitude of international corporates expected to set up operations in Dubai, we will see renewed interest in real estate from a new set of buyers," he added.
Near-completion status
Property Finder Data and Research has found 43,882 residential units within 136 projects in Dubai to have a completion status between 85-99 per cent to date with an expected completion by the end of 2019. Considering the historical materialisation rate of 50 per cent, one can expect a decent number of these units to reach completion by the end of this year, the report said.
Property Finder estimates 4,133 residential units within 18 projects in Dubai to have a completion status between 65-99 per cent until September 2020, a month before Expo 2020.
Cumulatively, between today and September 2020, we could see the completion of up to 48,015 residential units in Dubai. However, construction completion does not necessarily translate into handover of the homes.
Breaking down the supply figures further, apartments account for a major chunk of the upcoming inventory in 2019 at 33,548 units while villas/townhouses and serviced apartments will number around 4,612 and 5,622 units, respectively.
Supply to surge
"Yes, construction and delivery will ramp up, especially for us at Azizi Developments as we will be delivering approximately 4,000 units this year alone, in line with our Year of Construction," Farhad Azizi, CEO of Azizi Developments, said.
"While supply will surge, we also believe that demand will increase for- and post-Expo 2020 with business being brought to the Emirates," he added.
Developers had announced several hotel/serviced apartment projects in order to serve the expected 25 million visitors estimated to arrive in Dubai for Expo 2020.
Of the estimated residential supply expected in 2020 (until September), apartments will account for 2,853 units while villas/townhouses will number around 1,280.
"Riding on the back of the exceptional sales performance we have had in the first four months of this year, we are aggressively launching new products aimed at both the investor as well as the end user community within this year," Alfred of Sobha Realty said.
In the run-up to the Mena region's first Expo in 2020, several developers had launched projects in Dubai in 2016 and 2017 to cater to investor demand. Developers are going the extra mile to meet construction deadlines this year as excitement builds up for the mega event in 2020.
"With Expo 2020's 25 million visitors in six months, not only the tourism industry benefits, but the economy as a whole. This, as well as the robust growth environment that our leaders have built for our nation, is sure to boost real estate demand and result in a retained upwards trajectory," Farhad Azizi said.
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