Ras Al Khaimah’s largest developer is repaying a loan ahead of schedule in a move that reflects the robust state of the emirate’s property sector.
RAK Properties said yesterday it would repay the Investment and Development Office (IDO) of Ras Al Khaimah US$22.32 million, due in July, along with an early settlement fee.
The company termed the move as cash-flow planning and said it would save on finance costs.
The developer’s third quarter profits fell 55 per cent and net income touched Dh30.3 million from Dh67.5m in the same period in 2012. The developer had attributed the fall to money set aside for impairment and rising expenses.
In 2009, RAK Properties received $150m from IDO to finance existing and future projects.
A week ahead of Cityscape last October, RAK’s largest developer launched 104 waterfront Flamingo Villas and two 20-storey apartment buildings in Lagoon Heights, and sold 50 per cent of the villas within a few days.
The latest phase cost RAK Properties Dh400m with prices for the villas ranging from Dh750,000 to Dh2.5m, said the company’s director of marketing and sales, Rashed Sultan Al Khatri. The company expects to sell 75 per cent of the units off plan, with handover in two years.
Apartments, which will be for lease only, are expected to hit the market by 2016.
Flamingo Villas and Lagoon Heights are part of the 30 million square foot Mina Al Arab development, which was launched in 2005 and is under progress in phases.
The project’s previous phases included 307 villas, which had prices from Dh2m to Dh5.2m and were sold out by 2011. The earlier phases included 808 apartments at prices between Dh295,000 and Dh1.2m.
Yesterday on the Abu Dhabi Exchange, RAK Properties’ shares closed at 98 fils, down a fil from Monday’s close, which was their peak for the year. They started 2013 at 38 fils apiece. The emirate’s property values have been rising throughout the year.
In 2013’s first quarter, RAK’s real estate prices rose by as much as 16 per cent, according to Al Hamra Real Estate Development, which developed flats and villas in Al Hamra Village.
The property company Cluttons said in June that new one-bedroom flats in RAK were selling for about Dh350,000, while rents were about Dh30,000 annually early in 2013.
Prices have generally risen since then, though amounts vary according to location.
A studio in Mina Al Arab is selling for Dh250,000, while a one-bedroom in Julphar Tower fetches Dh600,000, according to postings in Dubizzle.
A 5,436 sq ft, four-bedroom villa is going for Dh5m, while a 2,700 sq ft, three-bedroom villa has an asking price of Dh1.68m. Both are in Al Hamra area.