FutureBrand's 2008 Gulf Real Estate Study

FutureBrand is a full-service global branding firm. Shaping with Strategy. Communicating with Design. Implementing for Impact and Reach. We build real estate brands that aim to increase value and sales velocity, inspire wanderlust and fire imaginations – all over the world.www.futurebrand.com/gres

Year four of FutureBrand’s Gulf Real Estate Study showcases an ever-expanding category in a thriving region. Global teams have assessed new trends, practices and accomplishments. Quantitative research was conducted exclusively for this Study. A matured focus, incisive points of view and extensive industry expertise have again resulted in the only comprehensive marketing assessment of the Gulf real estate industry.

GULF REAL ESTATE STUDY

FUTUREbRAnD’S 2008

ARE YOU A FUTUREbRAnD?With unparalleled experience pioneering brands in the region, FutureBrand believes that our expertise and not just our understanding sets us apart from others. We are the only brand consultancy to deliver a powerful point of view, tools and methodologies tailored for the real estate and destination branding industry.

As our name suggests, a focus on the future is an essential part of our branding process. This, combined with our unique and proven brand philosophy, is how we help clients create, deepen and mature brands holistically. A true “futurebrand” creates a new definition of brand excellence – a brand that thinks ahead to stay ahead.

FRAmEwORk AnD DESiREWe begin brand development by creating a strategic framework that enables us to identify the core focus for your brand. This is customized for each of our clients and aims at optimizing your brand to deliver effectively. Using unmatched category insights and combined strengths in consulting and design, we define the opportunity and create a value proposition for your business and a visual expression for your brand that is ownable, differentiating and lasting. We aim to unlock what customers desire.

DEciSiOn AnD mOTivATiOn

The framework is linked to your brand’s maturity and how customers (existing and potential) view it on a continuum from awareness to advocacy. This helps us to understand how and why customers make purchase decisions and determines what can trigger decisions to buy or invest. The framework also considers what barriers the brand needs to overcome strategically and creatively. These insights allow your brand to be finely tuned to its audiences and their relative requirements. We aim to build brands that contribute to high levels of customer advocacy.

i wAnT... mAkE mE...

THE ESSEnTiAL

THE ESSEncE

DEciSiOn

ADvOcATE

AwAREnESS

TAkE nOTicE

PREFER YOU

bUY/invEST

FEEL SATiSFiED

TELL OTHERS

EmOTiOnAL EnGAGEmEnTPERFORmAncE

wiDE cHOicES

TRAnSPAREncY AUTHEnTiciTY

SEnSE OF PURPOSE

1

FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY

2


2008This year has brought interesting events to the marketplace. Evidence of global economic volatility, government intervention and category maturity continues to be seen. New urbanism, the environment and ultimate living are trends consistent with a growing industry that is looking ahead, though corruption and increased regulation demonstrate the need for further oversight and cast a shadow over the category.

Real estate in the Gulf seemed to offer more of the same this year. Countless towers, smart office buildings, residential communities and retail malls have been created. Luxury continues to be a dominant theme, although

last year’s buzz of sustainability and green initiatives is still growing strong, and customers are still struggling to get answers, information and assurances.

While Dubai seemed a bit more subdued this year, Abu Dhabi continued to initiate large-scale projects and garner considerable attention. Development in Bahrain slowed although the giant Diyar Al Muharraq was introduced. Oman had a strong year despite some issues with the Blue City project. And Qatar remained one of the most steady real estate markets in the region.

The GCC retail real estate market is the fastest-growing in the world, with more than 16.35 million sq m of gross leasable area (GLA) expected to be complete by 2010.2

The UAE was recently ranked fourth overall in global land sales, jumping 23 spots since the same time last year. The UAE now claims 5.8% of worldwide real estate sales, propelled by a whopping increase of 1,348% since 2007.3

Mortgage lending in the UAE, which opened its property sector to foreign investment in 2002, almost doubled in 2007.4

Dubai’s land transactions totaled US $39.3 billion in just the first half of 2008, and are on the way to easily surpass the US $50 billion mark – the total completed during all of 2007.5

Roughly 3,000 towers (both mid- and high-rise) will be in various stages of planning, design, development and construction in Dubai between now and 2025.6

Shanghai, with a population of 20 million, and Moscow, with a population of 10.4 million, currently have approximately the same amount of office space as Dubai, a city of 1.6 million.7

Abu Dhabi’s real estate sector boasts total project values of more than US $460 billion.8

Abu Dhabi experienced a 200% increase in the commercial real estate rental sector, reportedly the highest in the world.9

Abu Dhabi’s share of the UAE mortgage market is forecasted to increase to 22%, up from 5% in 2007.10

The construction sector currently contributes 5% of Saudi Arabia’s US $278 billion GDP.11

More than US $180 billion of investment is needed in Saudi Arabia’s real estate sector to meet expected demand for housing projected for 2015.12

Real estate transaction volumes in Kuwait decreased by 65% in July 2008, marking the fourth consecutive month of decline following new regulation banning residential property trading. The total value of realty sales during May 2008, as compared to May 2007, declined by 36%.13

The government of Qatar has allocated 10% (US $7.3 billion) of its projected expenditure for the year toward infrastructure investment aimed at facilitating its burgeoning real estate growth.14

The Omani construction sector will grow at 8.7% per annum during the period from 2008-2012, and is expected to reach a value of US $2.5 billion in 2012, which would contribute 4.7% to the Omani GDP.15

Considerable growth in the Omani real estate market is expected to continue, with the value of demand exceeding US $20.8 billion by 2010.16

nEwS AnD nOTEwORTHY

THE TOTAL vALUE OF REAL ESTATE PROjEcTS UnDER cOnSTRUcTiOn in THE Gcc iS mORE THAn US $2.39 TRiLLiOn1

YEAR inREviEw

nEw nOTAbLES

cOnTinUinG nOTAbLES FROm 2007

mORE bRAnDS…EvERYwHEREDevelopers seem to be going to market with a growing list of associated or partner brands. These range from amenities to finance partners and can sometimes result in customer confusion about which is the lead brand.

OTHER EmiRATES SHinEMajor developments are taking shape outside the usual real estate hotspots in such cities as Ajman and Ras Al Khaimah, which wisely promote themselves as weekend spots or calmer respites. Ajman also recently introduced a law allowing foreigners to own freehold land and gained notoriety with Al Zorah.

biG PLAYERS RE-bRAnDSome major developers have re-branded this year, notably Deyyar, Damac and Al Burj.

mORE GREEn THAn EvER Green fever is still in the air, and sustainability and environmental awareness remain a top focus for regional developers. Examples include Emaar’s Mishrif Heights and Dubai Properties' Mohammed Bin Rashid Gardens.

A biRD, A PLAnE, A ROTATinG TOwER The 420-m Dynamic Tower will feature 80 apartments that spin, at voice command, 360 degrees around a central column by means of 79 power-generating wind turbines located between each floor. It is slated to be operational in 2010.

RAmPAnT inFLATiOnInflation remains a challenge for many in the Gulf. Oman saw it reach an 18-year high of 14%, and a similar rate is attributed to Qatar. Inflation in Saudi Arabia reached 10.6%, a 30-year high, while some predict that inflation will soar to a record 12% in the UAE.

DUbAi GETS FinE DininGTop chefs continue to open restaurants in Dubai. Michelin chef Guy Savoy is creating a restaurant at the Tiger Woods Dubai. Nobu is on its way, as are additional upscale offerings from Michelin chefs Michel Rostang and Santi Santamaria.

SUPERSTAR bRAnDinGOne-upping starchitects, celebrities like Brad Pitt and Pamela Anderson are endorsing and helping to design eco-friendly projects in Dubai and Abu Dhabi.

PRE-LAUncH TREnD cOnTinUESMost major developers continued to gauge market interest and reaction to pricing through soft or pre-launch events.

DEvELOPER EXPAnSiOnLast year’s trend has continued to progress, with major developers announcing expansion plans in the region and beyond. Emaar now features offerings in Pakistan, Damac in Iraq, and Limitless in Jordan and Turkey.

wHAT HAPPEnED TO EXcLUSivES?Exclusive partnerships and associations seem to be a thing of the past. While Trump Tower is actively being promoted by Nakheel as the most expensive property in Dubai, this does not seem to stop Donald Trump from being linked to Hydra Properties.

AUcTiOnSAuctions are becoming a more common way to sell. Jumeirah Golf Estates has long used them effectively to garner record-high prices, and this year Nakheel held auctions with the Golden Mile and Canal District, as did Emaar for villas in Arabian Canal and plots in Emirates Hills.

iPO FEvERThere has been talk of IPOs for major players Damac and Nakheel as well as the property arm of investment bank Ithmaar.

HOTEL EvEnT LAUncHESAs space and construction costs in the region continue to skyrocket, many developers have begun to stage significant launch events in five-star hotels to wait for the completion of – and in some cases, replace – sales centers.

TRAnSPORT wiTHin DEvELOPmEnTSDevelopers across the region are embracing localized transport networks as a way to ease the flow of traffic within their developments, leading to pedestrian-friendly areas. Examples include Downtown Burj Dubai, City of Arabia and The Palm.

YOU bUY iT, YOU kEEP iTBoth Aldar and Nakheel are restricting “flipping” and placing limits on the resale of their properties in an effort to curb market overheating.

FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY

43

EmERGinG TREnDSTHE PRAcTicALEmERGEncE OF ASSET mAnAGEmEnT bRAnDSAs communities get completed and residents move in, the notions of community maintenance requirements and owners’ associations have begun to gain momentum. Special groups have been created by many developers (Nakheel Asset Management, Emrill, Wasl), but this still appears to be an area that most do not spend time or money on. As a result, critical customer communications are often handled with black-and-white photocopies attached to a blackboard.

THE FUnPRivATE PERFORmAncESDevelopers are pulling out all the stops to attract buyers, especially to high-end products. Dubai Pearl flew 150 potential investors to Paris for a private Elton John concert, while Desert Dream brought recording artists Enrique Iglesias, Elissa and Raghav to Dubai for a private concert hosted by ex-footballer Ian Wright. Nurai’s launch in Abu Dhabi included helicopter flights and a Lionel Ritchie performance.

EnTERTAinmEnT LUREEntertainment-based developments continue to be on the rise. Boasting sporting venues and theme parks as central attractions, developments like Dubailand and Yas Island look to attract tourists, while also being home to residential communities. Four years from now, the UAE will have almost 30 theme parks. Kuwait is also experiencing an amusement park boom, with recent announcements of a Cartoon Network–branded theme park and an Islamic-inspired heroes entertainment park called 99 Village.17

THE nOT-SO-FUnnO mORE RESiDEncY viSASDubai has agitated many homebuyers by no longer guaranteeing residency visas for property purchasers. It has been reported that some master developers have recently removed this clause from their contracts.18

FOREiGn PROPERTY invESTORS LOOkinG ELSEwHEREGulf domestic investors appear to be top players in the regional market after current economic conditions and Gulf prices have caused many foreign investors to look for cheaper opportunities. Legislative measures to combat property price inflation – such as rental caps, trading restrictions and possible capital gains taxes – have made Gulf property less appealing for some foreign investors. Kuwaiti authorities have banned residential property trading in an effort to curb inflation, while similar restrictions have been announced in Dubai.

DELAYS, cAncELLATiOnS AnD cOncERnS Above and beyond the usual delays, several prominent developers have canceled (or tried to cancel) projects due to unanticipated upsurges in building material and labor costs and overly ambitious designs. Others have felt the sting of unhappy investors and customers who have taken their complaints public. In Dubai, intervention is likely the reason that more developers have not abandoned projects. Notable projects experiencing issues this year: Damac’s Palm Springs project, Dubailand’s Plantation Equestrian and Polo Club, Blue City in Oman, Sokook’s Ivory Towers and Schön’s Dubai Lagoons. Interestingly, some developments have also been delayed or canceled due to fears about adequate infrastructure and utilities. These include Al Salam City in Umm al Quwain and Al Ameera Village in Ajman.

5


6


is the industry at a crossroads? Has it just completed its first stage, which will lead to great heights? Or have market overheating, higher costs, corruption and bureaucracy signaled a shifting downward spin?

• EXPAnDinG POPULATiOnS AnD GDP GROwTH

• GOVERNMENT INVESTMENT AND SPENDING

• GENERAL GROWTH OF SOVEREIGN STATES

• GLOBAL PLAYERS AND BRANDS INVOLVED

• VISIONARY RULERS

• YOUNG, GROWING POPULATION

• THE PAST EIGHT YEARS OF SUCCESS

• CORRUPTION

• DELAYS

• LACK OF TRANSPARENCY

• INFLATION

• SATURATION

• BUREAUCRATIC REGULATIONS

• ANTI-SPECULATOR/FLIPPING MEASURES

• GLOBAL RECESSION

wHY nOT?wHY bELiEvE?is the industry at a crossroads? will recent rapid growth serve as the foundation of continued success? Or have higher costs, corruption and bureaucracy triggered a downward spiral?

7

FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDYFUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY

8


87

cORRUPTiOn REGULATiOnS

major developers and related companies have

fallen under scrutiny for alleged backhanded

deals, kickbacks, embezzlement and a slew of

other charges. The government suggests that even

more charges and related regulations to prevent

corruption are underway.

February 2008 saw a new law issued by the government of Dubai in order to regulate the management of shared facilities in buildings to remove ambiguity about whether the developer or owner is responsible for such matters.

A new mortgage law was created to increase transparency to further protect the rights of buyers and lenders. The law stipulates that mortgage contracts must be registered with the Dubai Land Department and provide all the details of the specific loan.

A new Dubai property court was established to deal with civil cases related to real estate. The new court will initially have 10 judges, who are currently undergoing training with the Real Estate Regulatory Authority (RERA) regarding the specifics of the Dubai marketplace.

A property rental index that provides pricing recommendations for rental homes in Dubai will launch in early 2009, with the hope of preventing landlords from exaggerating annual rent prices.

Dubai’s Land Department passed a law making it compulsory for off-plan property sales to be registered with them. The law also bars developers from charging transfer fees for such sales.

in Dubai, 2008 proved to be a year of shocking corruption ...and increased government measures in response

9


10


109

DUbAi, UAEDubai is enjoying continued and unprecedented real estate growth, with property prices rising by approximately 40% since last year.30 The government is investing heavily in infrastructure, such as the light rail network set to open in 2009, as well as roads and public spaces. Amid constant attention on the world stage, Dubai continues to thrive. Approximately 25,000 people per month take up residence in Dubai: that’s 33 new people per hour choosing to make the city their home.31

2008 Updates & milestones• Corruption charges were brought against staff members

of Deyaar, nakheel and Sama Dubai in cases unrelated to each other.

• Dubai Metro conducted limited trial runs of Dubai’s first-ever rail network, set to launch in September 2009.

• Emaar plans low- and middle-income housing developments in the UAE and abroad.32

• Dubai Properties unveiled the US $60 billion, eco-friendly mohammed bin Rashid Gardens project masterplan.33

• Nakheel launched the Veneto and Badrah districts of the newly re-branded waterfront, along with Dubai Promenade and The Lake District.

• Trump Tower launched as the centerpiece on Palm Jumeirah with events in new York and california.• Burj Dubai, standing 900 m high, became the tallest structure in the world.

THE REGiOn AT A GLAncEThe Gulf is continuing to show growth, with both Abu Dhabi and Dubai focusing on infrastructure to meet the related needs of their developments. Overall, prices are climbing with middle-income end users often priced out of the majority of new offerings.

mUScAT, OmAnRanked as one of the top 10 places to visit by Condé Nast Traveler, Oman is becoming the destination of choice in the region.34 With major developments taking shape across the country and numerous golf resorts already attracting international attention, Oman is set to increase its real estate sector considerably, despite some well-publicized missteps with Blue City. In fact, the volume of real estate deals in Oman has risen by nearly 50% in the past two years.35

2008 Updates & milestones• The average price per sq m for residential land in

Oman increased by 253%, reaching US $135 per sq m in 2007, compared to US $38 in 2005.16

• The government introduced a 7% cap on annual rent increases to protect tenants against record inflation.36

• The government recently disallowed property owners from issuing eviction notices to defaulting tenants.36

• Old Town, a 36,000 sq m residential and commercial project in Ruwi, was launched; it features apartments and a bazaar.

• Foreign ownership rights have been extended to include non-Gcc nationals, but only in certain designated areas.37

• The US $1.6 billion Omagine resort received government approval.

• The Blue City project failed to sell units and missed quarterly targets.38

• 85% of the advanced earthworks has been completed for Salam Yiti – Oman’s premier lifestyle resort project.39

• The Wave, Muscat will deliver 120 villas and townhouses by the end of 2008, with residents moving in shortly thereafter.40

mAnAmA, bAHRAinRecently ranked as the best-positioned economy in the GCC, Bahrain is continuing development of its collection of projects, notably Diyar Al Muharraq.

2008 Updates & milestones• Bahrain’s real estate market faces a record year in 2008, with an estimated turnover of US $5.7 billion. This number represents a 58% increase in market transactions from 2007, based on the first quarter’s results of US $1.4 billion.19

• The government is delaying projects in order to curb inflation and attract investors.20

• Diyar Al Muharraq, a US $3.2 billion mixed-use urban development that will be one of bahrain’s largest, was recently launched and is slated to break ground in early 2009.21

• Reef Island is expected to complete its first phase of construction in early 2009.• Bahrain Bay construction is well underway and plots have been sold to a variety of

global developers.• Construction of Bahrain’s biggest mall, Bahrain City Centre, is now complete. By next year, its two hotels and an indoor/outdoor water park will open.22

• Marina West, Bahrain’s first gated beachfront high-rise residential and lifestyle community, announced that the sub-structure work for all of its residential towers is complete and distinctly visible.23

• 1000 villas from Durrat Al Bahrain, a US $3 billion mixed-use island development, will be delivered in november 2008.24

DOHA, QATARBuoyed by rapid development of infrastructure projects and increasing incomes, Qatar’s development market is looking strong. The country has been named as the world’s second-fastest growing economy in the property sector in 2008.25

2008 Updates & milestones• Qatar has agreed to freeze all rents signed since 2005 for the next two years. Prior to this law, Qatari landlords could

raise rents between 5% and 20% on rental contracts signed before 2005, depending on the rental price.26

• The Qatar Real Estate Investment Company plans investment of US $2.75 billion in housing projects over the next five years.27

• Qatar’s biggest project, the Lusail development, which is organized into 17 districts and estimated to house 200,000 residents, has completed its conception stage. The infrastructure, including roads and an underground train network, is slated to be completed within the next three years.28

• Damac launched two residential towers at the Lusail development: Garden Heights and The Terrace at Fox Hills.• A total of 93,000 residential units are planned to be delivered by 2010.29

11


12


jEDDAH, SAUDi ARAbiASaudi Arabia made a splash in the region’s real estate sector with announcements of mega-projects that will become cornerstones of the country's future. Total real estate investments in Saudi Arabia, which is the largest construction market in the Middle East, are estimated at US $270 billion, and the total value of new projects is likely to reach US $410 billion this year.41

kUwAiT ciTY, kUwAiTKuwait offers some interesting development opportunities despite government restrictions on property trading. Kuwait is expected to have the third-largest supply of retail space in the Gulf, with an expected growth of 10% by 2010. 46

2008 Updates & milestones• Kuwait will build the world’s first sculptured skyscraper, Al Hamra, a commercial tower with two tilting walls.• Silk City, a 250 sq km US $132 billion development, launched this year. When complete, it will create 430,000 jobs and homes for 750,000 people.47

• The Avenues, a shopping, leisure and business destination, is set to open in 2010. The development will offer 140,000 sq m of retail space, including 10 cinemas, an entertainment complex, 39 restaurants, four-star hotels and a convention center.17

• Al Aqeeq Marina was soft launched by Hydra Properties at Cityscape USA.

2008 Updates & milestones• It has been reported that Saudi Arabia’s Shura Council has approved a draft of a long-awaited

mortgage law. The law, which has been in the works for almost a decade, allows much wider access to property ownership in a country where only one out of five people own homes.42

• The construction sector currently contributes approximately 5% to the overall GDP.11

• Jeddah Gate, Emaar’s flagship KSA project, is said to be on schedule with its infrastructure work.43

• Dar Al-Arkan was awarded a contract by the local authorities for the development of the Khozam Palace project. This multiyear initiative, to be executed through a joint venture with the

local authorities, is aimed at rejuvenating the area surrounding the historical khozam Palace, located in the center of jeddah.44

• Despite problems with excess water and coral reefs, the Lamar Towers project, slated to be the tallest building in jeddah, is on schedule.45

• Despite reports of being scaled back, designs for the Mile High Tower, slated to be 1,600 m tall and twice the height of burj Dubai, will be publicly unveiled in October 2008.

AbU DHAbi, UAEAbu Dhabi has built its reputation from the ground up over the last few years. It is now moving aggressively to expand and has recently been ranked by Jones Lang LaSalle as a “power city” on its way to becoming a world-renowned “urban star.”48

2008 Updates & milestones• Expected to be operational by 2030, the new capital of Khalifa City will

house all federal ministries in a 49 million sq m area. Project costs are estimated at US $40 billion.49

• Work has started on Yas Island developments. With a cumulative value of US $39 billion, the island will be a mixed-use development featuring golf courses, a Formula One circuit and a Ferrari theme park.49

• Nurai by Zaya, a community of limited edition resort beachfront estates and waterfront villas, was launched with a slick campaign and high prices.50

• Preliminary details have been released on a light rail project, currently in its study phase, which will span 350 km.51

THE REGiOn AT A GLAncE

13


14


Related to last year’s focus on the environment and sustainability, this year’s buzz has a slight nuance: the shift from theory to practice. New Urbanism has been behind some of the region’s major developments. While the term varies in how publicly it is being used, some of the core practices should sound familiar to anyone with real estate experience in the region.

Developed in the 1980s, New Urbanism is an American design philosophy. Its purpose is to create sustainable neighborhoods that contain diverse housing and jobs, are walkable and encourage social interaction. Examples include Seaside and Celebration, both in Florida.41

bASic TEnETS • Neighborhoodshavediscernablecenters,whichcouldbe a square or park • Avarietyofhometypesarefeatured • Shopsandofficesarenearbyandsatisfytheessential needs of the community • Streetswithintheneighborhoodformaconnectednetwork • Developmentsareonahumanscale • Accessto,fromandaroundthecommunityiseasy • Walkabilityisamajorrequirement

THIS YEAR’S BUZZ:

nEw URbAniSmTHIS YEAR’S BUZZ:

DESTinATiOnS On THE RiSEAnother buzzworthy feature this year was the rise of many Gulf locations as destinations. not only promoting major developments and attractions, several cities and countries in the region have re-branded themselves or launched new trade and/or tourism-related campaigns.

There are many new projects in the Gulf using New Urbanism as part of their core message:

“The population of city of Silk will live within 30 communities made up of five to seven villages, with each community served by its own schools, healthcare facilities and employment. weaving the fabric of these different areas together will be a network of parks and lakes, with the designers promising that everyone living within the development will be no more than three blocks away from open space.”

— "City of Silk," Arabian Business, 21 August 2008

“The mohammed bin Rashid Gardens represent the most innovative approach to urban form to be found anywhere in the middle East… Its 56 million square feet of verdant parks and gardens divide an 880 million square foot city into a network of sustainable neighbourhoods, each containing the molecule of daily life. Scaled around walkable distances that provide easy access to food, healthcare and education, this enlightened model of urban planning will help reverse the Gulf’s existing commuter culture that has eroded both communities and the environment.”

— Civic Arts

“conserving energy, using natural cooling and light, employing efficient infrastructure, protecting water quality and ecologies, and creating comfortable, walkable places are all part of [Palm Deira’s] design vision.”

— Calthorpe

“Designed around the needs of individuals, veneto is the waterfront district where the most innovative principles of community design produce a thoroughly comfortable and sophisticated environment…veneto is divided into small walkable neighbourhoods where every amenity and convenience is only a short stroll from home, giving it a feel of comfort and charm.”35

— Veneto website

“Al Zorah…will be designed in accordance with the principles of liveability and sustainability…This mixed-use development will establish neighborhood communities, create synergy between activities and reduce car dependence…The city center contains urban forms of five distinct types, with a mixed land use, predominantly residential above-ground floor retail, underground parking, pedestrian walkways, squares including a major public square where large events can take place.”

— Al Zorah brochure

“The master plan for our canalside development bears all the hallmarks of a classic Limitless project. balanced, sustainable and planned around people, it includes green, open spaces and distinctive residential, commercial, retail and recreational components.”

— Limitless press release on Arabian Canal

15


16


HYPERbOLE cOnTinUES TO

REiGn SUPREmE

DEFininG A UniQUE vOicEWhile last year we focused on the proliferation of luxury, this year we looked at extravagant claims a bit more broadly. Luxury is going strong, with more and more entrants jumping on this bandwagon. “Paradise,” “masterpiece,” “dream” and “perfection” are other lofty claims developers make, suggesting that modesty is not a virtue when it comes to real estate. In their efforts to top one another, more and more projects are parroting the same tired phrases. All this adds up to missed opportunity. Although it's a considerable challenge, in a sea of overstatements, nothing is as memorable as a new message.

TOP FIVE OVERUSED ExAGGERATED WORDS:1. Luxury2. Dream3. Paradise4. Live/Living5. Reinvented

“ULTimATE LUXURY” “An ever lasting dream” “imAGinE LUXURY LivinG TAkEn TO THE nEXT LEvEL. A PLAcE OF EXTRAORDinARY bEAUTY wHERE YOU cAn EnjOY THE bEST OF wHAT LiFE HAS TO OFFER.”

“WheRe Life is PLayeD out to PeRfection”

“There is only one masterpiece” “youR oWn Piece of PaRaDise” “Be in the center of luxury, with a new lifestyle”

“Living ReinventeD”

“Quality par excellence”

“THE mOST PRESTiGiOUS ADDRESS... BIZ BAY”

“Make this dream your permanent address”

“ULTimATE PRivAcY AcHiEvED AmiD ELEGAnT SOPHiSTicATiOn”

“mOvinG inTO YOUR DREAm HOmE”“Unbound luxury, bound by community”

“a commitment to perfection”“The benchmark of corporate luxury”

"a PLace to buiLD youR DReams"

“FOR SOmE PARADiSE iS jUST A DREAm, FOR OTHERS iT’S THEiR ADDRESS”

“WheRe LuxuRy meets PeRfection”“wHERE LUXURY iS EFFORTLESS”

“cREATED FOR A SELEcT FEw” “mAjESTic LivinG AmiDST inSPiRED viLLAS”

FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDYFUTUREbRAnD’S 2008 GULF REAL ESTATE STUDYFUTUREbRAnD’S 2008 GULF REAL ESTATE STUDYFUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY

17


18


1817

THE SEARcH FOR AUTHEnTiciTYOver the past year or two, there has been a definite increase in the use of Arabic, exemplified by the powerful “Hoyamal” campaign by Aldar. This includes the names of developments as well as in mandated contracts, signage and wayfinding. Where once English names seemed preferred (The Meadows, The Lakes), now Burj Dubai and Madinat Jumeirah are standard and growing more common every day. This is especially evident with developers linked to the government.

The use of Arabic is a greater indication of the region’s growing confidence in its own history and authenticity. No longer required to look abroad for information and inspiration, many are now looking for unique brand voices from within.

ARABICIZATION EmERGES

ALDAR’S cOmPELLinG HOYAmAL cAmPAiGn SiGnALED A nEw ERA in REGiOnAL REAL ESTATE ADvERTiSinG.

PROjEcT nAmESAL FURjAnAL GHARbiAAQEEQ AL mARinAARjAnARZANAHASmARAn AL ZEINAAL ZORAHbAb AL bAHR bADRAHbURj AL FARA’A

bAwAbAT AL SHARQDiYAR AL mUHARRAQLiwAnmAjAnMIZINnOOR AL AinnUROmRAnREmRAAmRUwAYASALAm RESORT19


20


2019

THE DiFFicULTiES OF POSiTiOninG A REAL ESTATE bRAnDWith the explosion of development and the brands that have been created, most real estate postionings are already in use in the Gulf marketplace, particularly those that center on luxury. For a new brand entering the playing field, what unique opportunities are left?

LivinG inHARmOnY

ULTimATEin ELEGAncE

ULTimATEin LUXURY

ADDRESSOF cHOicE

THE SOciALcEnTER

nEXTGEnERATiOn

REDEFininGLUXURY

THE LUREOF wATER

DESERTPARADiSE

SOPHiSTicATEDLiFESTYLE

micRO-SEGmEnTS

wATERFROnTLUXURY

THE PLAcETO bE

in THEcEnTER

GREEnORiEnTED

FAmiLYFiRST

SPALivinG

A bRiGHTFUTURE EScAPE

vALUE

HAvEn

ScEnic AnD

TRAnQUiL

AFFORDAbLE

PROXimiTY

cOnnEcTEDTO EvERYTHinG

THE bESTOF ALL

wORLDS

ciTYwiTHinA ciTY

nEw HEiGHTS OF

LUXURY

EXPAnDYOUR

HORIZONS

LivEYOUR

vAcATiOn

FiRST-TimEHOmEOwnERS

mODERn AnDTEcHnOLOGY

FOcUSED

SELF-cOnTAinED

AnDSUSTAinAbLE

FORTHE SELEcT

FEw

HEARTbEATOF THE ciTY

21


22


China and the GCC, each with enormous cash reserves from trade surpluses, will be the two leading infrastructure investors of the future.53 OTHER NOTABLE INITIATIVES:ABU DHABI Planning to spend upwards of US $15 billion by 2012 on infrastructure projects including road networks, bridges, public transport and a significant airport expansion54

QATAR Allocated US $8.4 billion for spending on infrastructure projects, notably the country's road network55

AJMAN Spending US $2.4 billion in infrastructure, including a coal-driven power plant56

KUWAIT Projections indicate the government will invest US $3 billion in the construction industry over the next five years57

DUBAI Spending more than 33% of its budget on infrastructure, approximately US $12 billion58

SAUDI ARABIA Major project underway upgrading 866 km of roadways leading to Makkah, Madinah, Riyadh, Al Qassim, Jouf, Jizan, Tabuk and Asir from all corners of the Kingdom59

• A US $248 million iconic bridge connecting Abu Dhabi and Dubai is nearing completion. It will be the third bridge connecting the two cities and is designed to symbolize sand dunes.60

• A 13.7 km, four-lane tunnel is being constructed in Abu Dhabi to help ease traffic congestion at a total cost of US $1.25 billion.61

• Saudi Arabia has envisaged an investment of US $8 billion to modernize and equip its ports.62

• Sharjah is constructing a US $45 million, 32-km road network across new residential neighborhoods. The plan includes a storm-water system, a sewage system and auxiliary roads.63

• Mubadala and GE recently entered a joint venture together. Over the next 18 months, the companies plan to invest US $40 billion in commercial and infrastructure projects in the region, GE’s fastest-growing market.64

• Qatar has recently spent US $5.7 million on wastewater treatment projects.65

on infrastructure over the next three years53

US$400biLLiOn


23 24


Gulf countries are aggressively building and

increasing the size, capacity and stature of

their airports, often positioned as gateways

to the region and beyond. Airports are

becoming more than transit centers; they are

valuable real estate, economic catalysts and

destinations in and of themselves.

AIRPORTS:

With a US $9 billion budget, the New Doha International Airport will replace the existing airport in 2010. The hub will have a 4.2 km runway and a 4.8 km runway – one of the longest in the world – designed to accommodate the A380. Built over 22 sq km, half of which is reclaimed land, the airport will feature some 40 contact gates, 22 remote gates, 62 parking positions, a 750,000 ton-per-year cargo facility, a cargo aircraft maintenance center and various other maintenance centers.

Currently undergoing a major US $6.8 billion expansion, the Abu Dhabi International Airport will add a new terminal and runway, state-of-the-art air traffic control tower and expansive cargo facility. The new Midfield Terminal Complex will include additional immigration and handling facilities, and provide thousands of square meters of extra retail space, which will exclusively offer premium brands unavailable in other duty free outlets in the region. Collectively, the current development efforts will double the existing airport land area and raise the airport’s annual passenger capacity to 20-40 million passengers by 2010, with further expansion initiatives to follow thereafter.

New Doha International / Doha, QatarAbu Dhabi International / abu Dhabi, uae

DOHAUH

AnD THE nEw PUbLic REALmENGINES OF ECONOMIC DEVELOPMENT

Already award-winning and well established, Dubai International Airport is expanding to more than double its current passenger capacity. In addition, the emirate is also spending US $10 billion on Al Maktoum International, which will become the world’s largest airport with the capacity to serve up to 120 million passengers per year. It will feature six parallel runways, 4.5 km in length, each separated by a distance of 800 m. The airport will also have three passenger terminals: one dedicated to airlines of the Emirates Group, the second to other carriers and the third to low-cost carriers. Sixteen cargo terminals with a combined 12-million-ton capacity will also be constructed.

Dubai International Al Maktoum International

DXb + jXb

Bahrain announced plans for a major expansion of its international airport that will have a price tag of nearly a billion dollars. The plan will concentrate on expanding the terminal capacity to meet the country’s air transportation requirements for the next two decades. The airport’s existing terminal has been handling more than seven million passengers a year at an average annual passenger growth rate of 9% and an average annual cargo growth rate of 7%.

Bahrain International / manama, bahrain

bAHDubai, uae

biLLiOnS SPEnT

US $23

UAEUS $11

SAUDIARABIA

US $9

QATARUS $2

KUWAITUS $1

BAHRAIN


25 26


LUXURY URbAn cOnDOSGLObAL SAmPLE

NAME NAME

DUBAI PEARL

DUBAI PEARL

LIVING SHANGRI-LA

LIVING SHANGRI-LA

K RESIDENCE LUMIÈRE RESIDENCESMANDARIN ORIENTAL W NY DOWNTOWNTHE LANDMARK

THE LANDMARK

LOCATION

DEVELOPER

ARCHITECT

FLOORS

UNITS

YEAR COMPLETED

BUILDING AMENITIES

UNIT DETAILS

STARTING PRICE (USD)

PRICE PER SQ FT (USD)

KEY MESSAGING

UNIT DETAILS

LOCATION

ARCHITECT

DEVELOPER

FLOORS

UNITS

YEAR COMPLETED

BUILDING AMENITIES

PRICE PER SQ FT (USD)

KEY MESSAGING

STARTING PRICE (USD)

Pearl Dubai FZ LLC / Al Fahim Group

Dubai, UAE

Schweger Association Architects

2010

67 in each of four towers

2,000

spa & gym, wellness clinic, private lobbies, viewing decks, water features on each floor, performing arts theater, jogging track, high-end shopping mall, six luxury hotels, link to public transport

rainfall showerhead, oval-shaped jet baths, luxury countertops & floors, designer cabinetry

$2,573,000

$900

“24-hour living city”

KL Landmark Sdn Bhd

Kuala Lumpur, Malaysia

dcmstudios

2009

50

180

spa & fitness center, children’s pool & playground, bar, café & lounge, library & business center, mini-market, clubhouse, barbecue area, screening room, butler service

city center & mountain views, balcony, built-in wardrobes, interior design & lifestyle options from Christian Liagre, Yasumichi Morita, Minotti, Bulthaup, Gaggenau and ULTI

$1,792,200

$586

“Style has a new address”

Palladian Development

Chicago, USA

Solomon Cordwell Buenz

2009

74

150

spa & gym, 24-hour room service, full-service pet spa, five-star restaurant, childcare services, tailoring, personal shopping

14-ft ceilings, full-length windows,Miele dishwasher, Sub-Zero refrigerator, Wolf cooktop, acoustical treatment between floors & demising walls

$3,357,000

$1,536

“Prepare to be delighted”

Chalegrove Properties

London, England

Squire and Partners

West Tower: 2006 / East Tower: 2010

West Tower: 31 / East Tower: 45

662

landscaped piazza, restaurants & boutiques, high-speed elevator, underground secure car parking, fitness center, environmentally friendly biomass heating system, boutiques

floor-to-ceiling windows, balcony, built-in double wardrobes, Siemens kitchen appliances, Villeroy & Boch bathroom fixtures, oversized showers, underfloor comfort heating

$1,476,000

$1,638

“Own property in the heart of the world’s fastest-growing financial district”

Peterson Investment Group /Westbank Projects Corp.

Vancouver, Canada

James K.M. Cheng Architects Inc.

2008

61

227

spa & fitness center, juice bar,specialty grocery store, exhibition space curated by Vancouver Art Gallery, library & game room, limousine service, media screening room, LEED Silver certification

Coal Harbour, English Bay & Stanley Park views, kitchen appliances by Boffi & Miele, Kallista cast-iron bathtub, bathroom fixtures by Hansgrohe Axor & Philippe Starck

$2,573,000

$900

“The best of cosmopolitan West Coast living”

Frasers Property Group

Sydney, Australia

Foster + Partners

2008

56

456

glass atrium lobby w/glass- bottom pool above, Club Lumière Spa, multi-purpose event room, underground car park, movie screening room

kitchens & bathrooms designed by Foster, laundry room, full-height doors, tinted windows, color A/V intercom, home automation systems

$993,000

$972

“There can be no other choice: welcome to Lumière Residences”

The Moinian Group

New York, USA

Gwathmey Siegel & Associates

2009

57

223

spa & fitness center, roof terrace w/cabanas, rooftop lounge & café,landscaped plaza, luxury hotel on lower floors, media screening room

customizable interiors, optional Graft furniture, concealed flat-screen TV, kitchen appliances by Miele and Asko, bathroom fixtures by Dornbract, Grohe, Jeeves and Duravit

$1,476,000

$1,638

“Own it”

27


28


Leisurecorp

Dubai, UAE

Greg Norman, Vijay Singh, Pete Dye, Sergio Garcia

4

Phase A: 2009

900+

2–6

golf & tennis academies, clubhouses,jogging & cycling tracks, fitness & spa center, parks & lakes, GPS tracking systems, restaurants, retail galleries,post offices, organic market, hotels,metro access

furnishings by Poggenpohl, B&B Italia, Miele and Bang & Olufsen, courtyard & pool, landscaped gardens, double garage, maid’s room, fireplaces, walk-in wardrobes

$2,700,000

$450

“Come home to a legend”

Flag Luxury Properties

British West Indies, Anguilla

Greg Norman

1

2008

37

3

golf & tennis club, sailing & catamaran tours, hiking & bike trails, horseback riding, water sports center, 4,400 ft of beach, fitness center, St. Regis Resort,Remòde spa, David Bouley restaurant,kids & junior club, car rental

Mediterranean architecture, white stucco exteriors, landscaped garden,courtyard ringed w/palms, infinity pool, Jacuzzi, floor-to-ceiling windows

$1,400,000

$467

“An oasis of tranquility and the promise of exclusive luxury”

Cantiles de Mita, S.A. de C.V.

Punta Mita, Mexico

Jack Nicklaus

2

Phases I–IV: 2006Phase V: 2008

60+

4

tennis facilities, 9.5 miles of beach,spa & fitness center, laundry & dry cleaning, pet care, multiple dining options, pre-arrival grocery shopping

courtyard entry w/water fountain, heated infinity plunge pool w/ Venetian tile, terraces w/ocean views, exposed hardwood beams, floor-to-ceiling windows, full wet bar, Viking appliances

$3,600,000

$498

“Live the dream”

Tatweer

Dubai, UAE

Tiger Woods

1

2009

100

custom

golf academy, clubhouse,luxury boutique hotel, spa & fitness center, gourmet dining (including Gus Savoy signature restaurant), retail boutiques, beauty salon

landscaped gardens, pools,smart home technology, in-home security linked directly to community security center and local police, fire & medical services

$17,700,000

$1,473

“A golfing community that perfectly embodies the style and status of our namesake”

Mission Hills Group

Guanlan, China

*Please see below

12

2005

1200+

up to 12

atrium, spa, kids' club, gym, hotels, dining options, banquet hall, clubhouse, six driving ranges, tennis, country club

private gardens, pool, arches, columns, balconies, home theater, private elevator

$917,000

$258 (original)

“216 holes, world’s #1”

The Trump Organization / Empresas Diaz Inc.

North Coast, Puerto Rico

Tom Kite

2

Phase I: 2008Full Completion: 2010

500

2–3

clubhouse, restaurant & lounge, 1,000 acres of oceanfront, Trump Tranquility Spa, 10-acre beach club w/spa & fitness center, nursery & kids club, tennis facilities, Trump Founder Club (includes use of a private jet, helicopter & limousine)

hurricane-resistant windows & doors,electronic concierge, Sub-Zero appliances, wine cooler, 10-ft ceilings & floor-to-ceiling windows

$1,550,000

$528

“Discover the luxury of Trump and the beauty of the ‘enchanted island’”

Castle Harbour Ltd.

Tucker’s Town, Bermuda

Roger Rulewich

1

2008

14

2–4

tennis center, clubhouse, spa & fitness center, beach & sailing club,water sport center, pre-arrival grocery shopping, luxury hotel & resort,restaurants

500 sq ft veranda, private pool, oversized showers & whirlpool tubs, oversized garages to accommodate golf carts

$2,500,000

$1,351

“The Bermuda of your dreams awaits you”

*Pricing comprises off-plan and resale figures

*Jack nicklaus, greg norman,

annika sorenstam, ernie els,

vijay singh, nick faldo, Jose

maria olazabal, David Duval,

Jumbo ozaki, David Leadbetter,

Pete Dye, Zhang Lianwei

NAME NAME

JUMEIRAH GOLF ESTATES TEMENOS ANGUILLAPUNTA MITA THE TIGER WOODS MISSION HILLS GOLF CLUBTRUMP INTERNATIONAL GOLF CLUB & RESIDENCES

TUCKER’S POINT CLUB

VILLA DETAILS VILLA DETAILS

LOCATION LOCATION

COURSE DESIGNER COURSE DESIGNER

DEVELOPER DEVELOPER

YEAR COMPLETED YEAR COMPLETED

VILLAS VILLAS

COURSES COURSES

BEDROOMS BEDROOMS

COMMUNITY AMENITIES COMMUNITY AMENITIES

PRICE PER SQ FT* (USD) PRICE PER SQ FT* (USD)

KEY MESSAGING KEY MESSAGING

STARTING PRICE* (USD) STARTING PRICE* (USD)

LUXURY GOLF viLLASGLObAL SAmPLE

JUMEIRAH GOLF ESTATES

THE TIGER WOODS

TUCKER’S POINT CLUB

TRUMP INTERNATIONAL GOLF CLUB & RESIDENCES

29


30


NAME NAME

LE PROVENÇAL REFLECTIONS AT KEPPEL BAYCANCúN TOWERS DUBAI PROMENADETRUMP OCEAN CLUB THE LIGHT POINTONE SINGER ISLAND

UNIT DETAILS

LOCATION

ARCHITECT

DEVELOPER

FLOORS

UNITS

YEAR COMPLETED

BUILDING AMENITIES

PRICE PER SQ FT* (USD)

KEY MESSAGING

STARTING PRICE* (USD)

LOCATION

DEVELOPER

ARCHITECT

FLOORS

UNITS

YEAR COMPLETED

BUILDING AMENITIES

UNIT DETAILS

STARTING PRICE* (USD)

PRICE PER SQ FT* (USD)

KEY MESSAGING

Cyril Dennis

Cap d’Antibes, France

Frank Jay Gould (original)

2008

10

56

24-hour concierge, porter & parking valet, spa & wellness clinic, private beach & beachclub, golf club & academy, tennis club/academy, ski club w/resident lift passes, yacht & helicopter services, wine cellar, advanced security systems

Porsche kitchens, Louis Vuitton furniture, Turkish baths, Glass fireplaces, shower email capabilities, temperature-colored tap water, indoor & outdoor penthouse pools

$2,962,000

$2,613 –9,625

“One of the most beautiful hotels on the French Riviera, returned to its former glory”

Acrosur Developers

Cancún, Mexico

De Regil Arquitectos

Second Tower: 2009

18–20

50

330-vessel marina, Tom Weiskopf-designed golf course, gym & spa, tennis courts, infinity pools, event rooms, hotel, commercial area

Jacuzzi, direct elevator service, roof gardens, MABE appliances, high-end IT infrastructure, water purifying system

$345,000

$190–355

“Where emotions come together”

Trump Organization / K-Group Developers

Panama City, Panama

Arias Serna Saravia

2010

70

1,004

wellness spa & pool deck, Island Beach Club, yacht club, casino, boutiques, restaurants, 24-hour Quintessentially concierge services, 24-hour valet service, limousine service, 24-hour medical service, business center

European cabinetry, panoramic ocean views, 9.5-ft ceilings, stainless steel appliances, frameless showers

$534,000

$524–550

“Paradise from a new point of view”

WCI Communities

Singer Island, USA

Robert M. Swedroe

2006

10

15

private beach, billiards room, club room & patio, concierge, fitness center, pool, private theater, wine room, services from The Resort at Singer Island

Sub-Zero, Wolf and Miele kitchen appliances, wine cooler, Jacuzzi and Toto bathroom fixtures, built-in closet system, medical alert systems in master baths

$2,300,000

$791–840

“Singer Island's most exclusive address”

Keppel Land

Sentosa, Singapore

Daniel Libeskind

2012

24

82

sky gardens, nine sky bridges linking six towers, reflecting pools, clubhouse, tennis courts, gym, pools, children’s play areas, 10-year membership to Marina at Keppel Bay featuring member clubhouse, dining and charter services to neighboring islands

built-in wardrobes, full-height French windows, private elevator lobbies, Miele, Hansgrohe Axor, Duravit, Starck and Kaldewei bathroom fixtures

$1,131,000

$1,105–1,603

“Waterfront living at its finest”

Nakheel

Dubai, UAE

Atkins

2011

44–54

1,973

health club, pools, children’s play area, sky garden, communal prayer rooms, mall, pier w/cafés & shops, storage rooms, supermarket, advanced security systems, private 70-berth marina, neighboring Icon and Boutique hotels nearby

shading louvers, luxury appliances, wardrobes w/built-in lighting, fully integrated semi-open kitchens

$1,198,000

$921

“Centre Yourself”

Jelutong Development Sdn Bhd

Penang, Malaysia

Architect Permata

2012

28

88

green features such as recycled materials, green roof, rainwater harvesting, waste management, solar & wind energy and marine life programs, commercial district w/dining & retail, hotel, conference facilities, cultural hall, waterfront amphitheater, sports park, double-gated security system

home automation of lights and security with remote access, keyless entry, high-end IT infrastructure, luxury appliances

$331,000

$174

“An iconic landmark to distinguish Penang as a world-class destination”

wATERFROnT cOnDOSGLObAL SAmPLE

*Pricing comprises off-plan and resale figures

ONE SINGER ISLAND

TRUMP OCEAN CLUB

REFLECTIONS AT KEPPEL BAY

DUBAI PROMENADE

31


32


PROPRiETARY QUAnTiTATivE RESEARcH STUDY

Emaar remains the dominant developer in the region this year. what may be more surprising is how Damac has risen as a brand to stand shoulder-to-shoulder with nakheel, legendary creator of The Palm and The world.

THE TOP DEvELOPERS in SAUDi ARAbiA, QATAR AnD THE UAE

To better understand homebuyer attitudes and perceptions, Futurebrand worked with an independent market research firm to conduct a quantitative study of 250 recent and prospective home purchasers in Saudi Arabia, Qatar and the UAE (see page 46 for details on the methodology). This research provides insights into what buyers want, what motivates them and what factors drive their purchase decisions. Specifically covered are familiarity with and perceptions of leading developers; preference and consideration of various home types, amenities and locations; and the drivers of developer preference.

DEvELOPER REcOGniTiOnEmaar remains the most recognized developer brand, with Damac and Nakheel tied for thesecond position, both significantly behind Emaar but far more recognized than all other developers.

* Top 2 Box identifies the percentage of respondents who rated the developer as the one they are most or second-most familiar with. ** Top Box is the percentage who rated the developer Excellent.

*** Top Box is the percentage of respondents who agree completely with the statement, “This is the developer I would most want to buy a home from.”

DEvELOPER PREFEREncEEmaar, again, stands alone as the most highly esteemed and most preferred developer brand, with Damac and Nakheel following distantly in a virtual tie for the second position.

EmAAR EmAAR

EmAAR

DAmAc DAmAc

DAmAc

nAkHEEL nAkHEEL

nAkHEEL

ALDAR ALDAR

ALDAR

DUbAi PROPERTiES DUbAi PROPERTiES

DUbAi PROPERTiES

bARwA bARwA

bARwA

DAR AL ARkAn DAR AL ARkAn

DAR AL ARkAn

QATARi DiAR QATARi DiAR

QATARi DiAR

UniTED DEvELOPmEnT cOmPAnY (UDc)



77%

32%

32%

14%

13%

10%

9%

8%

5%

mOST wAnT TO bUY A HOmE FROm (TOP bOX)***

EXcELLEnT OvERALL RATinG (TOP bOX)**

TOP 2 bOX* FAmiLiARiTY AcROSS THE UAE, SAUDi ARAbiA AnD QATAR

70%

26%

25%

13%

11%

3%

4%

7%

3%

55%

19%

18%

13%

7%

3%

5%

7%

2%

33


34


3433

DEvELOPER imAGE“Room to improve” and “parity at the top” are the two key takeaways from the brand image analysis. Across the 14 most important image attributes (based on the degree to which each attribute influences perceptions), the top five performing brands average a b grade. Perceived performance is uniformly good rather than great, even though these are the leading developer brands in the region. There is also a high degree of parity: Emaar remains the clear leader (ranked #1 on 12 of the 14 attributes), but its advantage over Nakheel and Damac is much smaller than it was for familiarity and preference. Dubai Properties and some of the second-tier developers show strengths in select areas as well.

EmAAR

EmAAR

EmAAR

EmAAR

EmAAR

nAkHEEL

EmAAR

EmAAR

bARwA

EmAAR

EmAAR

EmAAR

QATARi DiAR

DAmAc

DAmAc

DAmAc

ALDAR

ALDAR

DAmAc

DAmAc

DAmAc

DAmAc

DAmAc

DAmAc

nAkHEEL

DAmAcEmAAR

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

DUbAiPROPERTiES

nAkHEEL

ALDAR

ALDAR

ALDAR

ALDAR

DAR AL ARkAn

UDc

nAkHEEL

nAkHEEL

nAkHEEL

nAkHEEL

nAkHEEL

DAmAc

EmAAR

DAmAc

nAkHEEL

nAkHEEL

ALDAR

ALDAR

ALDAR

ALDAR

UDc

DAmAc

nAkHEEL

nAkHEEL

HiGH-QUALiTY cOnSTRUcTiOn

AVERAGE GRADE: b+

AVERAGE GRADE: b+ AVERAGE GRADE: b+

AVERAGE GRADE: b AVERAGE GRADE: c+

AVERAGE GRADE: b

AVERAGE GRADE: b-

AVERAGE GRADE: b+

AVERAGE GRADE: b

AVERAGE GRADE: b

AVERAGE GRADE: b

AVERAGE GRADE: b

AVERAGE GRADE: bAVERAGE GRADE: b

DELivERS On TimE

innOvATivE

Average rating on a 5-point scale, from 1 (Unacceptable) to 5 (Superior). Average rating on a 5-point scale, from 1 (Unacceptable) to 5 (Superior).

TRUSTwORTHY

EnviROnmEnTALLY ORiEnTED

REASOnAbLY PRicED

RESPOnSivE cUSTOmER SERvicE

bUiLDS GREAT PLAcES TO LivE

EXPERiEncEDLUXURiOUS HOmES

EASY TO wORk wiTH

cOmmUnicATES PROGRESS

4.6

4.4

4.5

4.5

4.5

4.4

4.6

4.2

4.3

4.3

4.6

4.5

4.5

4.4

4.4

4.3

4.5

4.5

4.3

4.3

4.5

4.0

3.9

3.9

4.4

4.4

4.4

4.3

4.3

4.3

4.4

4.4

4.4

4.2

4.2

4.2

4.2

4.2

4.3

4.4

4.4

4.0

4.0

3.8

3.8

3.8

4.4

4.4

4.3

4.4

4.4

GOOD vALUE FOR THE mOnEY DESiRAbLE LOcATiOnS

EmAAR EmAAR

nAkHEEL

ALDAR

nAkHEEL

DAmAc

4.4

4.4

4.2

4.2

4.1

4.4

4.4

4.3

4.3

4.3

4.3

4.3

4.3

4.1 4.1

4.1

4.1

4.1

4.2

35


36


35 36

HOmE TYPE APPEALwATERFROnT TRUmPS EvERYTHinG

When respondents in Saudi Arabia, Qatar and the UAE rate various types of homes based on their appeal*, proximity to water is the clear winner, a choice that is more preferred than homes in city centers or on golf courses.

villas on island beach resorts and mainland apartments overlooking water are the two most appealing options among all the home styles surveyed. The average appeal levels for villas and apartments, at 78% and 74% respectively, are at statistical parity – indicating roughly equivalent levels of preference overall.

viLLAS APARTmEnTS

mAinLAnDAPARTmEnT

OvERLOOkinGwATER

APPEAL LEVEL:

84%HiGH-RiSE APARTmEnT in ciTY cEnTER

APPEAL LEVEL:

75%

viLLA in GOLF cOmmUniTYAPPEAL LEVEL:

72%

viLLA in EcOLOGicAL

PARkAPPEAL LEVEL:

79%

viLLA On iSLAnD

bEAcH RESORTAPPEAL LEVEL:

82%

APARTmEnT in GOLF cOmmUniTY

APPEAL LEVEL:

64%

* Home types were rated independently of each other based on the degree to which respondents find them appealing. * Home types were rated independently of each other based on the degree to which respondents find them appealing.

37


38


HOmE FEATURE DRivERS

To determine what buyers really want and the true degree to which various amenities can be leveraged, Futurebrand created the DEciSiOn inDEX. Based on a detailed formula that takes into account both the strength of preference and the extent of dislike for a specific amenity, the Decision Index reflects the degree of polarization for each amenity – and quantifies the overall ability of a specific amenity to drive consumer decisions. A high Decision Index is a measure of the net market preference for an amenity, indicating that the percentage of people who love the amenity far exceeds the percentage who don’t like it. by combining the most preferred and least preferred percentages into one composite measure, the Decision Index can be used as a planning tool to gauge how much home features and amenities can be leveraged. The charts on this page depict the Decision Indexes of various features and amenities in five categories.

THE FORMULA: Homebuyers rank ordered the amenities in each category from most preferred to least preferred. The percentages that each amenity was rated most preferred and least preferred were then inserted into the formula detailed below.

OUTDOOR AmEniTiESIn terms of absolute preference, no single amenity stands out; however, the Decision Index shows Swimming Pool and Private Yard to be the most compelling choices for a developer. Each can be leveraged more than twice as much as the next leading options.

TEcHnOLOGYIn the technology category, Security System stands out as the dominant amenity in terms of both absolute preference and the Decision Index.

FLOORinGMarble is the dominant choice in the flooring category, more than double the preference and Decision Index of the next leading choice, Ceramic Tile.

The home features with the broadest market appeal are famed architects, modern and European architecture, marble floors, security systems, private yards and pools

ARcHiTEcTURAL DESiGnEuropean and Modern Architecture perform best on the Decision Index, but do it differently. European is the most preferred and most polarizing; Modern is somewhat less preferred but also less disliked.

DESiGnER FEATURESThe Decision Index shows Famous Architect to be the dominant choice in the category – it is the most preferred, and it is the safest choice for a developer.

58

18 0

164

HiGH-EnDAPPLiAncES

DEciSiOn inDEXDEciSiOn inDEX

DEciSiOn inDEX

DEciSiOn inDEX

DEciSiOn inDEX

DESiGnERkiTcHEn

KEY:

Di = DEciSiOn inDEX

mP = mOST PREFERRED

LP = LEAST PREFERRED

mPi = mOST PREFERRED inDEX

LPi = LEAST PREFERRED inDEX

a = ADjUSTmEnT FAcTOR (bASED On THE 80/20 RULE)

DESiGnERbATHROOm

FAmOUSARcHiTEcT

113

mODERn EUROPEAn ARAbiAn ASiAn HARDwOOD cARPET mARbLE cERAmicTiLE

106

42

-21

39

153

70

-22

28

158

3817

HiGH-SPEEDinTERnET AccESS

SwimminG POOL

mARinA AccESS

PRivATEYARD

TERRAcE mULTiPLEcAR

PARkinG

mAinROAD

AccESS

PUbLicTRAnSPORT

AccESS

SEcURiTYSYSTEm

AUTOmATEDvALET

cAbLE OR SATELLiTE Tv READY

129

155

59 59 53

-63

28

THE FORmULA

DI = aMPI – aLPI

aMPI = MPI x 80% aLPI = LPI x 20%

MPI =%MP

NormLPI =

%LP

Norm

39


40


DRivERS AnD LOcATiOnSwhere people in Saudi Arabia, Qatar and the UAE would choose to have a second or vacation home, and what drives their selection of a developer

ADDiTiOnAL inSiGHTS• Four of the top five most important drivers of developer preference – high-quality construction, trustworthy, responsive customer service and good value for the money – focus on reliability and emotional comfort. This suggests that developers need to establish a strong bond with their customers which largely seems lacking today.

• Even with luxurious homes being the second most important attribute, the four attributes that focus on premium quality and physical comfort – luxurious homes, desirable locations, premium amenities and well-planned units – are less than half as important as the reliability attributes. This is suggestive of an undercurrent of distrust in the real estate marketplace and a need for reassurance.

• The results of this undercurrent are evidenced in the performance of the Damac and nakheel brands over the past year. both brands suffered from publicized scandals yet were able to gain ground on Emaar in many brand image attributes. However, both failed to close the gap in the all-important “developer i most want to buy a home from” measure. • Nakheel is a brand that seems to be losing some traction. A year ago, these vision builders were well positioned as a clear #2, behind only Emaar in the region. now, nakheel has been largely caught by Damac on several key rankings including recognition, preference and perceptions of having experience and providing high-quality construction.

• At the same time, Emaar shows no signs of letting up its dominance, with a 141% advantage in familiarity and a 189% advantage in preference compared to the next leading brand as well as the #1 rank in 12 of the 14 most important brand image attributes.

• The two most efficient brands at converting familiarity into consideration, meaning moving from just being aware of a brand to considering purchasing from them, are Aldar, at 93%, and United Development company, at 88%. From a broader regional perspective, both of these brands suffer from limited geographic presence. neither is well-known outside its home market; however, both have established strong brand images in Abu Dhabi and Qatar, respectively.

• Interestingly, almost one-third of all respondents in Saudi Arabia, Qatar and the UAE selected their home city as their first or second choice for a second or vacation home. This may suggest that, beyond Dubai, many of these homebuyers do not see a compelling enough difference in other Gcc cities to merit their selection for a second home.

THE mOST DESiRED LOcATiOnSDubai stands alone as the most desired location for a second or vacation home, preferred more than three times as much as the next city.

DUbAi AbU DHAbi DOHA RiYADH RAk jEDDAH FUjAiRAH mUScAT kUwAiT ciTY

mAnAmASHARjAH

50.4%

11.5%9.9%

9.4% 7.3 % 6.8 % 6.8 % 4.7% 3.1% 2.1% 2.1%

PREFEREncE DRivERSThis graph depicts the relative importance of key attributes in terms of their ability to predict a homebuyer’s predisposition toward a developer. See page 46 for methodology on Relative Importance.

High-Quality construction 14.3%

13.2%

10.6%

10.4%

10.2%

8.1%

7.9%

4.3%

4.0%

3.6%

3.3%

2.9%

2.8%

2.5%

0.7%

0.5%

0.4%

0.2%

0.1%

Luxurious Homes

Trustworthy

Responsive customer Service

Good value for the money

Desirable Locations

innovative

communicates Progress

Reasonably Priced

Experienced

Delivers on Time

Easy to work with

Environmentally Oriented

builds Great Places to Live

well-Planned Units

Premium Amenities

Provides Homes That Are a Good investment

Government Affiliated

Financially Sound

41


42


43 44 4443

take a few minutes to assess your own brand performance across its key channels and marketing touchpoints. great brands maximize each channel’s advantages but still appear synergized and holistic.

INSTRUCTIONS:step 1: Rank your brand from 1-10 in each category across the bottom half of the chart. Perform indicated calculations where applicable. step 2: calculate scores for the four main categories (People, Product, materials, environments). step 3: add scores in each category to determine your benchmark score.

SCORING: 0-2 = not in channel; poor performance 3-5 = Poor to average 6-8 = good to very good 9-10 = excellent

WHAT YOUR SCORE MEANS FOR YOUR BRAND:

brand is failing and needs to improve across the board

brand is performing poorly and needs improvement

brand needs to address its flaws and upgrade areas of weakness

brand is performing reasonably well, although it may need to revisit specific areas of weakness in order to increase its efficacy

BENCHMARK SCORE:

add 5 scores below add 4 scores below

add 5scoresbelow

Dividetotalby 5

Divide totalby 4 add 4

scoresbelow

add 4 scoresbelow

add 3 scores below

execute formula in step 3 to calculate your benchmark score

WEB / DIGITAL*

operations staff

sales team

Leadership team

customer service

marketing Department

bEncHmARk YOUR bRAnD

PRODUcT mATERiALS EnviROnmEnTSPEOPLE

salesenvironment(s)

trade show(s)

event(s)

office(s)

Bx 0.6 =

COLLATERAL*

brochures

newsletters

flyers & giveaways

stationery

internal communications

outdoor

Radio / tv ads

corporate & Product videos

BROADCAST+ ADVERTISING

Print ads

targeted Rich mails

intranet & tools

main site& micro site(s)

online ads

constructionQuality

featuresinnovation

timelyDelivery

value formoney

Designaesthetics

sustainability

add 7 scores below

x 0.2 = A C

C

x 0.6 = D

D =E

E=

x 0.3 =

0-25:

26-50:

51-75:

76-100:

STEP

1ST

EP 3

STEP

2


A B

*Web/Digital and collateral are discounted to reflect the comparative importance of broadcast + advertising in influencing brand performance.

A bRiEF RETROSPEcTivEAfter four years of compiling and creating the Gulf Real Estate Study, it is amazing to view the evolution and breadth of proliferation, and the scale of expansion and value in the category. Growing pains abound, but more and more, the “futurebrands” of the industry are being shaped in this region and chronicled in our studies.

mATURATiOn (2005) HUGE (2005)

inFATUATiOn (2006) MEGA (2006)

SATURATiOn (2007) EPic (2007)

PROLiFERATiOn (2008) GARGAnTUAn (2008)

kEY cOnTAcTS

SOURcES

RinA [email protected]+ 1 212 931 6443

wiLLiAm [email protected]+ 971 4 367 8285

For more information about the Gulf Real Estate Study, purchasing customized research data, marketing seminars or branding services, please contact:

Disclaimer: All material presented herein is intended for informational purposes and has been compiled from sources deemed reliable including Developers, Proprietary Research, Published Data, Ministries of Planning and Secondary Sources. Though information is believed to be correct, material presented is subject to errors, omissions, changes or withdrawal without notice.

1. CommuniGate Middle East, 4 August 2008

2. “GCC Fastest Growing Retail Real Estate Market in the World,” AME Info, 14 March 2007

3. “UAE Fourth in World Land Sales List,” Arabian Business, 13 August 2008

4. “UAE Mortgage Lending Soars,” Arabian Business, 9 July 2008

5. “UAE Lands in World Top Five,” Emirates Business 24/7, 13 August 2008

6. “Dubai to Stand Tall with 3,000 Towers,” Gulf News, 7 August 2008

7. “Dubai Real Estate Overview,” Colliers International, Second Quarter 2008

8. “Abu Dhabi’s Real Estate Projects to Cross Dh1.71tr,” Dubai Inside, 16 May 2008

9. “Space Crunch,” Gulf Business, April 2008

10. “Abu Dhabi Real Estate Overview,” Colliers International, Second Quarter 2008

11. “Riyadh Real Estate Overview,” Colliers International, Fourth Quarter 2007

12. “180 bn Needed to Meet Housing Demand,” Arabian Business, 11 June 2008"

13. “Western Buyers Tepid on Hot Gulf Property,” Reuters, 29 August 2008

14. “Qatar a Burgeoning Real Estate Sector,” Euromoney, August 2008

15. “Omani Infrastructure Report 2008,” Business Monitor International

16. “Oman Property Market Set for Rapid Growth,” Arabian Business, 10 September 2008

17. “Worth the Kuwait,” Arabian Business, 7 August 2008

18. “No Visa Guarantees for Investors,” Arabian Business, 26 August 2008

19. “Building Bahrain,” Arabian Business, 18 September 2008

20. “Bahrain Projects Delayed in Bid to Ease Growth,” Arabian Business, 29 August 2008

21. “Diyar Al Muharraq’s $3.2 bn Bahrain Project,” The National, 25 June 2008

22. “Bahrain City Centre Opens for Business,” AME Info, 10 September 2008

23. “Work on Marina West Gathers Speed,” AME Info, 3 September 2008

OvERALL mETHODOLOGYThis research is a quantitative survey of 250 respondents, a sample that yields a margin of error of ±6.3% at a 95% confidence level. The research findings should be taken as representative of the GCC, rather than a definitive reading of homebuyers across the region. Face-to-face interviews were conducted in five GCC markets – Jeddah, Riyadh, Doha, Abu Dhabi and Dubai – among affluent adults, age 26+, who are recent or impending purchasers of a high-end home.

RELATivE imPORTAncE mETHODOLOGYThe relative importance of image attributes was determined using multivariate regression. Asking research respondents their opinions about what is important is simply not reliable or accurate, as what people say and what they do are typically not aligned. Multivariate regression examines patterns in the data to identify how perceptions and attitudes correlate with preferences.

24. “Durrat Al Bahrain Villas to be Delivered in November,” Durrat Al Bahrain website, 4 May 2008

25. “Real Estate Demand Rising,” Gulf Times, 8 July 2008

26. “Qatar Issues Rent Cap,” AME Info, 4 March 2008

27. “Alaqaria to Invest QR10bn on Housing Projects in Qatar,” Online Qatar, 2008

28. “Qatari Diar Lusail Development,

On its Way Ahead,” Online Qatar, 2008

29. “Qatar to Witness 93000 Residential Units by 2010,” Online Qatar, 2008

30. “Dubai Home Prices Climb 40%,” AME Info, 20 August 2008

31. “Arrival Figures Show Dubai is Booming with Developers Looking to the Long Term,” Property Wire, 23 August 2008

32. “Moving Downmarket,” The Gulf, 14-20 June 2008

33. “Dubai’s Eco-Friendly Master Plan Revealed,” Arabian Business, 31 August 2008

34. "Condé Nast Unfolds its Annual 'It List'," Arabian Business, 26 January 2008

35. “Throw of the Dice,” The Gulf, 19-25 July 2008

36. “Oman Rent Law to Safeguard Tenants,” Arabian Business, 10 March 2008

37. “Global Investment House: Oman Economic and Strategic Outlook – Real Estate Sector,” Entrepreneur, 8 May 2008

38. “Oman’s Blue City Causing Investor Concerns,” Arabian Business, 14 August 2008

39. “Sama Dubai Completes 85% of Advanced Earth Work of AED 6.5 Billion Salam Yiti – Oman Project,” Arabian Business, 28 May 2008

40. “The Wave, Muscat Adopts Sustainable Development Practices,” Arabian Business, 10 September 2008

41. “Value of New Projects in KSA to Reach $410b,” Khaleej Times, 14 August 2008

42. “Mortgage Law Approved in Saudi,” AME Info, 3 July 2008

43. “Jeddah Gate On Schedule,” Arabian Business, 16 August 2008

44. “Dar Al Arkan Real Estate Development Company Records a Profit of SAR 1.1 Billion for the First Half of 2008,” Arabian Business, 4 August 2008

45. “Saudi's Lamar Towers,” Arabian Business, 26 July 2008

46. “Kuwait Retail Supply Lags Behind Consumer Demand,” AME Info, 21 July 2008

47. “City of Silk,” Arabian Business, 21 August 2008

48. “World Learns from Abu Dhabi,” The National, 6 May 2008

49. “Top 10 Abu Dhabi Projects Worth Dh700b,” Gulf News, 16 May 2008

50. “Zaya Launched its First of Many Property Ventures on Nurai Island,” Zawya, 12 May 2008

51. “Top 10 Abu Dhabi Projects are Worth USD 190 Billion,” SteelGuru, 11 September 2008

52. “New Urbanism,” Wikipedia

53. “Merrill Lynch: Emerging Market Infrastructure Spending Will Surge 80% in the Next Three Years,” Jutia Group, 9 July 2008

54. “Abu Dhabi to Spend Dh55 Billion on Infrastructure Projects by 2012,” Gowealthy.com, 31 August 2008

55. “Qatar Focuses on Infrastructure Projects in its Budget,” Gulf News, 20 April 2008

56. “Ajman to Invest Dh8.8 billion in Infrastructure,” Khaleej Times, 29 July 2008

57. “Kuwait Infrastructure Report 2008,” Business Monitor International

58. “For Stability and Strategy, Economic and Social,” Gulf News, 19 August 2008

59. “Saudi Keen to Develop Highways to Main Cities,” Khaleej Times, 19 June 2008

60. “Iconic Bridge Takes Shape,” Gulf News, 23 July 2008

61. “Green Tunnel to Take Shape,” Gulf News," 28 July 2008

62. “Port Development Essential for Middle East,” Arabian Business, 7 April 2008

63. “Dh165 Million Infrastructure Development Plan for Sharjah Unveiled,” Gulf News, 28 July 2008

64. “GE, Abu Dhabi Firm in $8 Bln Joint Venture,” Reuters, 22 July 2008

65. “Metito Completes AED 21 Million Waste Water Treatment Projects in Qatar's ‘Gas Capital of the World’,” Arabian Business, 15 July 2008

66. “$68b Mena Airport Expansion Under Way,” Zawya, 22 March 2008

45


46


45 46

FutureBrand's 2008 Gulf Real Estate Study

Real Estate

average grade

spa amp

abu dhabi

real estate

bathroom fixtures

mortgage law

average grade

decision index