Northern Emirates

Thriving on affordability

The Northern Emirates continue to cash in on their proximity to Dubai, with Sharjah in particular seeing demand in Emerging Sharjah which promises dream homes that are value for money.

November 2019

Property, housing, tourism and power and water projects have been keeping the wheels of the construction industry turning in the Northern Emirates, which continue to be impacted by the market dynamics of the more affluent emirates of Dubai and Abu Dhabi.

Although the Northern Emirates – namely Sharjah, Ajman, Ras Al Khaimah, Fujairah, and Umm Al Quwain – have traditionally been termed sleepy compared to their vibrant neighbour Dubai, they have been trying to capitalise on their proximity to the more wealthy emirate, which is set to raise the curtains to the highly prestigious Expo 2020 Dubai less than a year on.

Affordability of property is a key factor that has kept the Northern Emirates attractive to people working in Dubai and it is this aspect most property developers tout while also responding to the demand for a luxurious and laid-back lifestyle.

Address Fujairah Resort & Spa ... a key project being developed by Eagle Hills.

Address Fujairah Resort & Spa ... a key project being developed by Eagle Hills.

Over the past nine months, however, the residential market of these emirates has been experiencing slight fluctuations as Sharjah’s apartment prices continued to soften, according to a report by dubizzle Property, a leading UAE-based online property platform.

According to Matthew Gregory, the director at dubizzle Property: “As property across the UAE becomes more affordable, it presents tenants who may have previously lived in Sharjah and commuted to work in neighbouring emirates, for example, with new opportunities to move to, or even invest in, a property in Dubai.

“This ultimately affects the demand for rental property in Sharjah, hence impacting the prices. However, as the industry continues on its journey through the property cycle, we will see the market begin to stabilise in the near future.”

Sharjah has established itself as a preferred residential destination, given its mature social infrastructure, vibrant retail environment and a relatively affordable cost of living, according to Savills, the Middle East’s leading real estate services provider.

Savills says its research shows that Sharjah’s growing population is driving demand for residential units across Emerging Sharjah. For instance, recent projects such as Al Zahia, Aljada, and Nasma Residences with excellent connectivity to the other emirates offer good quality development at relatively affordable rates. Therefore, this is attracting more tenants and causing steady movement of residents to these locations, which is in turn promoting the growth of businesses, retail and associated facilities in the areas, according to the report.

 

Sharjah Sustainable City ... a Dh2-billion partnership between Shurooq and Diamond Developers.

Sharjah Sustainable City ... a Dh2-billion partnership between Shurooq and Diamond Developers.

Real Estate

The real estate sector in Sharjah has seen a boom with 54,125 transactions valued at Dh22.5 billion ($6.12 billion) in 2018, as per a report released by the Sharjah Real Estate Registration Directorate.

Abdul Aziz Ahmed Al Shamsi, director-general of the Sharjah Real Estate Registration Directorate, attributed this growth to the investment opportunities available in the emirate and the attractive financing facilities offered by banks and banking institutions.

The recent government decisions to offer long-term residence visas up to 10 years for investors, residents, retirees and those wishing to study in the academic institutions nationwide have also had a significant impact in this regard, he stated.

Among the projects that have received significant interest is the Dh24 billion ($6.5 billion) Aljada, Sharjah’s largest mixed-use community, which is being developed by Arada. The latest residential community to be launched within the mega development is The Boulevard. Arada, meanwhile, is currently handing over homes in Phase Two of Nasma Residences, its first project.

The property developer reported exceptional year-to-date sales, despite a quieter period for the property market in the UAE.  It says that in the year until August, the value of its sales had grown by 30 per cent over 2018, with 1,801 units sold, up 86 per cent. In total, Arada has sold 4,200 units across both its Sharjah-based communities.

Aljada ... Sharjah’s largest mixed-use community.

Aljada ... Sharjah’s largest mixed-use community.

Another noteworthy project in Sharjah is the Dh2-billion Sharjah Sustainable City, the first urban mixed-use project launched early this year in the emirate. It is a strategic partnership between Sharjah Investment and Development Authority (Shurooq) and Diamond Developers, a leading sustainable communities developer in the UAE.

Spread across 7.2 million sq ft, it will feature 1,120 eco-friendly and energy-efficient villas with a modern-meets-oriental design in harmony with the unique architectural aesthetic Sharjah is known for.

Meanwhile, the Abu Dhabi-headquartered Eagle Hills is developing several major projects in Sharjah and Fujairah, which are reported to be receiving positive response from local, regional and international investors. These projects include Maryam Island, Kalba Waterfront and Palace Al Khan in Sharjah – which are being developed in partnership with Shurooq – and Fujairah Beach and The Address Residences Fujairah Resort and Spa in Fujairah.

Eagle Hills is building four residential buildings at Maryam Island – Sharjah’s prestigious waterfront address – which are in various stages of construction. It is also building Kalba Waterfront, an integrated leisure and retail destination; and the 88-room Palace Al Khan, one of the latest additions to Sharjah’s hospitality sector. 

Fujairah Beach is a five-star beachside resort offering 80 villas and townhouses and a 167-room Palace Hotel; while The Address Residences Fujairah Resort and Spa – a five-star hotel, villas and apartments offering branded serviced living by the Address Hotels + Resorts – has 196 rooms, four residential buildings, 10 villas and 172 branded and serviced apartments, all set to be delivered in 2020.

Among other developments in Fujairah, work is under way on the Fujairah Business Centre, which is due to be completed during the last quarter of 2020. It comprises two 19-storey towers – one being an office tower and the other a hotel with 228 rooms and suites as well as 79 furnished apartments – and a shopping mall.

Ras Al Khaimah, too, has its fair share of real estate projects comprising mixed-use, residential and hospitality facilities. RAK Properties is developing the Dh500-million Marbella Villas in Hayat Island, comprising 205 contemporary designed villas and townhouses facing a serene seafront. The mixed-use property provides access to several leisure and entertainment facilities located around Angel Bay.

Other projects under construction in Ras Al Khaimah include Movenpick Resort Hotel, Conrad Marjan Island Resort and the Hampton by Hilton at Al Marjan Island and Intercontinental Resort Hotel at Mina Al Arab.

 

Power & Water

Meanwhile, major power and water projects are taking shape in the Northern Emirates.

Early this year, HH Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, announced the allocation of Dh5.8 billion for water and electricity projects in the Northern Emirates. These include a Dh2.4-billion project to build dams and a federal water network that connects the water resources of these emirates with those of Abu Dhabi and Dubai; as well as a Dh1.2-billion solar power station in Umm Al Quwain, and a water desalination station with a capacity of 150 million gallons per day. These projects are set to be completed within the next two years.

Last month, the Emirates Water and Electricity Company (Ewec) announced that it had received six proposals for its ‘Fujairah F3’ independent power producer (IPP) project, the latest in a series of power projects that have been floated on the market in the Northern Emirates. The 13th IPP project to be developed in the UAE, the 2.4 GW combined-cycle gas turbine (CCGT) plant will play a key role in securing the future electricity needs of Abu Dhabi and the Northern Emirates region.

Meanwhile, work is in progress on a 1.8 GW independent power project in Sharjah. The project consist of three combined-cycle blocks, the first of which is planned to come online in 2021. The project is due to reach full commercial operations by mid-2023 and will sell its electricity production to Sharjah Electricity and Water Authority (Sewa) under a 25-year power purchase agreement (PPA). It is being developed by GE Energy Financial Services (GE EFS), Sumitomo Corporation, Shikoku Electric Power Company and Sharjah Asset Management (SAM), the investment arm of the Government of Sharjah.

In the water sector, a consortium of Saudi-based Acwa Power and MDC Power Holding Company – an entity fully owned by Mubadala Investment Company – is developing a 150-million-gallons-per-day desalination plant in Umm Al Quwain. Construction is expected to commence soon with initial water production scheduled in 2021. 

Other key projects are being developed as part of the national strategic water security plan (2019-2036), which seeks to build storage tanks, pipelines and networks managed by the Federal Water and Electricity Authority (Fewa) at a total investment of Dh2.4 billion. These will be completed within two years.

 

Housing

A number of housing schemes are being initiated under the Sheikh Zayed Housing Programme (SZHP).  Among the latest to be given the go-ahead is for 336 residences in the Al Sayouh 16 Residential Complex in Sharjah, which will be implemented by two UAE developers under contracts valued at a total of Dh365.4 million.

Another project earmarked for Sharjah is a 250-unit residential neighbourhood at Khor Fakkan in the Eastern Region.

 

Airports

The Northern Emirates have been upgrading their airport facilities to keep pace with passenger demand.

Sharjah has plans for a $408-million expansion of its airport. Tenders were issued recently for the main works and for the relocation of utilities, the building substructure, superstructure skeleton and other associated works for the expansion of the terminal building, designs for which are nearing completion. Construction is expected to start next year and the expansion will increase the airport’s capacity to 20 million passengers.

Fujairah International Airport, too, is undergoing an expansion, following the recent award of a $180-million deal to a consortium of Orascom Construction (ORAS) and UAE’s Al Sahraa Holding Company to develop the facility. The project, being implemented by the Abu Dhabi Airports Company, includes the construction of a new runway and terminal lounges, and expansion of the existing runway and terminal.

In Ras Al Khaimah, extensive renovation work, which included the duty-free area, was recently completed at the emirate’s international airport. 

 

Industry

Fujairah is working on a wide range of development projects as it seeks to diversify its economy. These include an underground oil storage, the largest of its kind in the world, being built by Abu Dhabi National Oil Company (Adnoc) and comprising three underground storage caverns – each with a capacity of 14 million barrels. The engineering, procurement and construction (EPC) contract is believed to be the largest single project award for underground crude oil storage in the world and is valued at Dh4.4 billion.

Also, work is under way in Fujairah on a new 250,000-barrels-a-day oil refinery project by Brooge Petroleum and Gas Investment Company and Sahara Energy Resources DMCC. The first phase of the refinery, which will produce bunker fuel, will be completed in the first quarter of 2020. Brooge has oil storage facilities in the Port of Fujairah. The port, its adjacent anchorage and the Fujairah Oil Industry Zone are already well established as the second largest oil bunkering centre in the world.

Meanwhile, Umm Al Quwain will host the UAE’s first state-of-the-art waste-to-energy   plant. The project, which has just broken ground, is being developed by Emirates RDF, a joint venture between UAE-based contractors Besix and TG Eco Holding and Finland-based Griffin Refineries. The plant is being built over a 400,000-sq-m area and, once operational in Q3 next year, will treat some 1,500 tonnes of municipal solid waste a day, thus generating 300,000 tonnes of alternative fuel annually.

 

Other Projects

• Sharjah Research, Technology and Innovation Park (SRTI Park) is currently building the first of the 3D printed houses within the park, in co-operation with Dutch company CyBe. This initiative will help establish the SRTI Park as a regional development centre for 3D printed construction.

• Sharjah’s Environment and Protected Areas Authority (EPAA) has joined hands with Emirates Nature-WWF, and the Emirates Marine Environmental Group (EMEG) to launch the Pearl of Sharjah development on Sir Bu Nair (SBN) Island, a three-year project aimed at preserving the island’s marine ecosystems and raising awareness about the environmental, cultural and heritage of the island.

• Shurooq is developing an iconic library and culture centre in Sharjah known as the ‘House of Wisdom’. The project, designed by Fosters + Partners, will feature more than 100,000 books. The two-storey building is scheduled for a public opening in 2020.

• Ras Al Khaimah-based Al Hamra Real Estate Development has opened its new exhibition and conference centre that boasts 500 sq m of private sandy beach, expansive landscaped gardens and an external deck. Al Hamra has also upgraded its retail destination Manar Mall at an investment of $100 million.




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