Abu Dhabi developer is looking to balance its portfolio with premium and mid-market offerings
Aldar Properties plans more affordable housing schemes next year
Aldar Properties is planning to launch at least one large affordable housing scheme next year, as the biggest developer in Abu Dhabi continues to build its portfolio of offerings to middle-income investors and end-users, banking on revived demand for mid-market properties, a senior company executive said on Tuesday.
“We have at least one large affordable housing scheme lined up for next year,” Talal Al Dhiyebi, Aldar’s chief development officer told The National at Cityscape Global in Dubai. “Aldar comes up with new launches every year. We are working on it and an affordable segment will definitely be a highlight of our offering. For this year the focus is on existing projects.”
Aldar, which reported a 5.2 per cent year on year decline in profits and a 20 per cent fall in revenues in the second quarter, had focused more on premium properties in the past. The firm is now trying to add balance to its portfolio to boost declining revenues and has already launched two mid-market projects within a span of less than six months in 2017.
“There will be more affordable housing in our key destinations such as Yas Islad and Reem Island and we are also looking at other potential destinations that we think can cater for them [affordable housing schemes],” said Mr Al Dhiyebi.
The firm is keeping an eye out for possibilities to strengthen its mid-market offerings, and is also working on some premium options.
Aldar launched The Bridges, its first affordable development of the year, in April. It has generated about Dh600 million in sales, and was sold out within three weeks of its launch at Cityscape Abu Dhabi.
The developer last week unveiled the 2,255 home Water’s Edge development on Yas Island. Sales for the Dh2.4bn development were launched at Cityscape Global in Dubai this week, marking Aldar’s first entry into the emirate’s property showcase in seven years.
Aldar, which had initially announced it would sell only one building with about 300 apartments at the Dubai property event, has released additional units, taking the total number of apartments to be sold to 440, Mr Al Dhiyebi said. “The response has been very good and that is the reason why we are selling the second building,” he said.
Meera on Reem Island, which is on track for handover next year, was the first-ever Aldar project targeting investors in the middle-income bracket. The developer plans to sell only about 892 units of the Water’s Edge to the public, while the remaining will be added to its leased residential portfolio to strengthen recurring revenue lines. The company had also sold only half of The Bridges’ project buildings to investors.
Aldar is firmly focused on building its asset management business as recurring revenues accounted for about 50 per cent of the total revenue in the first six months of this year, he said. The company wants to build and hold residential, commercial, hospitality, retail, educational assets, while looking opportunistically at the market to buy income producing assets.
“Our asset management is a very well diversified business,” he said. “There are lots of opportunities in the market but the key is finding the right opportunity that meets our investment and business requirements.”