Profile/Dubai: Apartments and villas in Sports City in Dubai are selling like hot cakes from €355,000. And next month, Aer Lingus will fly there direct from Dublin. Jack Fagan reports.
Even before Aer Lingus launches its direct service between Dublin and Dubai next month, Irish investors have been moving swiftly to buy homes in the world's fastest growing city.
A total of 168 apartments were sold within hours two weeks ago at an exhibition in Dublin and the Irish selling agents, Larionova, have compiled a waiting list of 800 buyers ready to purchase apartments in a variety of developments either under way or due to begin over the next few months.
The homes already sold in Ireland and others going on the market this week will all be located in Sports City, a €1.68 billion ($2 billion) international centre of excellence for a wide variety of sports. Construction of the global academy begins next month and should be completed by 2008.
Larionovo is to take bookings from tomorrow for both terraced homes and stand-alone villas on a championship-style golf course that will be one of the centre-pieces of the new "city within a city".
Four and five-bedroom terraced houses with floor areas up to 250.8sq m (2,700sq ft) will be priced from €355,000 to €425,000 while a small number of detached five-bedroom villas of 343.7sq m-418sq m (3,700sq ft-4,500sq ft) will be available from €560,000 to €957,000.
The first phase of homes on the Ernie Els-designed golf course were sold within hours when they were released for sale in Dubai last week.
After the huge success of its Dublin launch, Larionova, run by Raymond Norton and Andrew Brett, has also been appointed sole selling agent in the UK for Sport City, which will have a population of at least 70,000. Last year, UK residents bought over 100,000 second homes in Dubai where the market is supply-led.
Thousands of apartments and villas are bought off the plans to cater for the rapid growth in tourism and trade. There is always a shortage of completed properties.
For this reason, agents frequently report up to 30 per cent appreciation within a year on homes being built in good areas.
In one particular well-publicised instance, growth in values went as high as 100 per cent on resales at The Palm, the world's largest man-made islands, where several British soccer stars have bought large holiday homes.
Raymond Norton, managing director of Larionovo, estimates that when the homes now being sold are rented, they should show returns of between 12.7 and 14.8 per cent.
"Dubai's tax-free climate has a unique appeal because investors are not liable in the United Arab Emirates for either tax on rental income or capital gains tax. There are also no restrictions on repatriating funds," he said.
Economic growth has been startling to date mainly because Dubai has two economic advantages over its rivals.
Firstly, its location between Europe, Asia and Africa gives it a catchment area of 1.5 billion people within two hours by air; secondly it imposes no major Vat, property tax, wealth tax, inheritance tax, corporation tax or income tax. Not surprisingly, business has prospered and the all-controlling Al Maktoum dynasty that runs and rules the place is determined to show that developments like Sports City will continue to drive the all important property market.
The line-up for the complex is already impressive. There will be four world class stadia, the largest with 65,000 seats; four sporting academies including the Manchester United Soccer School, another golf school and others for tennis and cricket.
There will also be a full range of swimming pools, cycle and running tracks and other sporting facilities. These will be based alongside fine boulevards with vast shopping malls, restaurants, cafés, cinemas and entertainment centres.
The project is being pieced together on over 2,000 acres on a rectangular-shaped site that will also include a residential complex based around the stadia and the golf course.
The more discerning will wonder why Dubai is pursuing such a costly vision. The answer is that oil revenue that originally allowed the emirates to prosper now accounts for little more than 8 per cent of revenue.
Dubai sees its future prosperity in property, tourism and trade. And it has a string of other imaginative projects in the pipeline to keep the money rolling in. Essentially the emirate is a mammoth marketplace, a trade hub for the region which buys and sells-on goods.
There are about 40 large shopping malls, some of them tourist attractions in their own right. The newest one, the Mall of the Emirates, offers real snow skiing as well as shopping. Another precinct specialises in tax-free gold sales.
The huge range of attractions are designed to raise the number of tourists who visit Dubai every year from the present 5.2 million to 15 million in 2010.
To do this they are building a land of superlatives, one that not only has the world's largest artificial islands but eventually the world's largest theme park.
They already have the world's largest hotel, the Burj al-Arab, and are well advanced on Bhurj Tower, due to become the tallest building in the world.
Larionova, 126 Lower Baggot Street, D2 Tel 1890 252138
