(MENAFN - Khaleej Times) Cost of operations will substantially go down with the introduction of lease-to-own warehouses for industrial projects in Dubai as it is first of its kind in the Gulf region.
Being developed by Lootah Real Estate Development in Dubai Industrial Park, Senaeyat project will offer industrial warehouses on 99-year lease-to-own basis with starting price of Dh10 million and above.
Saleh Abdulla Lootah, executive director, Lootah Real Estate Development, said the company will develop 50 warehouses, including 20 in the first phase, and invest Dh300 million.
"We feel this sector has not been tapped and we are trying to give market what it needs. It is first lease-to-own warehouses industrial product in the region. We have seen lease-to-own residential projects but not in the industrial sector so it makes sense for long-term investment. This sustainable business model to different industries will help them convert their operational costs to assets," said Saleh Lootah.
He said around 70 per cent warehouses are occupied by lease holders in Al Quo and Ras Al Khor etc. on a renewable basis and the company will be mainly targeting these companies as it makes a better business proposition for them as they will become owners after 10 years and will save on rentals.
Lootah has acquired three million square feet land for 49 years with Dubai Industrial Park to establish Senaeyat. It will be offered in two phases. The first one includes one million square feet, and the second, two million square feet. The first phase has four different built-up areas - 20,000sqft, 24,000sqft, 30,000sqft, 36,000sqft - to focus more on small to medium-sized industries.
While the second phase will have the same size options, in addition to bigger built-up areas - 50,000 sqft and 60,000 sqft. "Ground-breaking of the project will start within two months. We have already signed with six companies are in final discussion with interested parties to sell 50 per cent of the plots," he added.
According to the Saleh Lootah, the warehouses will also be ready-to-use upon handover.
"We found that many vacant warehouse units are due to price mismatch in the market, so we made sure that Senaeyat keeps its portfolio at a reasonable price," explained Saleh Lootah.
He added that the new project supports the Dubai Industrial Strategy 2030, enabling the growth for the industrial ecosystem, providing clients with an important resource to achieve short to long-term goals.
"We are starting in Dubai and then expand to Abu Dhabi and Norther Emirates. All the units are being developed on are sustainable developments basis with green building certificates," he added.-