Capital Gate, the leaning tower of Abu Dhabi, has started its leasing campaign to lure in top quality tenants from across the city.
Capital Gate offers prestige at a price
It is one of Abu Dhabi's most distinctive new properties, but prestige will come at a price for tenants wanting to set up shop in the capital's leaning tower.
Prospective tenants in the Capital Gate, the curvaceous tower that leans at an angle of 18 degrees, will pay the highest rents in Abu Dhabi, starting at about Dh2,500 (US$680.62) per square metre.
Bill Lunt, the director at the Abu Dhabi National Exhibitions Company (Adnec), which built the tower, said the preference was for international companies that could help drive new business to Abu Dhabi's economy.
At yesterday's announced rates, a tenant renting an entire floor could pay as much as Dh2.6 million a year. Floor sizes range from about 950 sq metres to 1,050 sq metres. Rupert Bowen-Jones, a senior surveyor for the property consultancy CB Richard Ellis, said those were the highest rates in Abu Dhabi.
The estate agent Cluttons said in its first-quarter report yesterday that average prime rents for offices in the city were between Dh1,600 and Dh1,800 per sq metre. The average rentin the City of London is Dh3,500 per sq metre and in Manhattan Dh2,160 per sq metre.
Mr Lunt said Adnec would negotiate individual terms with tenants, depending on the length of the lease and what they could bring to the building.
"The main priority is to drive business and focus on the destination of Abu Dhabi," he said. "International companies would add more value because they could drive or introduce new business, but we do look at local companies as well."
Office rates in Abu Dhabi average about Dh2,000 per sq metre, down from a peak of Dh3,800 per sq metre in the final three months of 2008, according to the property consultancy Jones Lang LaSalle.
Abu Dhabi is approaching a stage where the major office and residential projects launched in the three years to 2008 are beginning to be delivered to the market. This is also coming at a time of uncertainty in the property sector, with demand for homes still at a low point and commercial tenants waiting for rents to fall further.
About 450,000 sq metres of office space is expected to be added to the market this year, and 1.4m sq metres before the end of 2013.
The prime competitors for Capital Centre, of which Capital Gate is the "crown jewel", are Mubadala Development's Sowwah Island, Aldar Properties' coin-shaped headquarters building in Al Raha Beach, and the office towers on Reem Island. Mubadala is a strategic investment company owned by the Abu Dhabi Government.
Mr Bowen-Jones said yesterday that Capital Centre was moving to the front of the field in the race to grab tenants.
"Capital Centre is much more manageable in terms of its size, and it's coming up very quickly," he said. "It's going to suddenly jump on to the map as a major business centre after the summer."
Technip, an oil services company, signed a deal in January to consolidate its offices across the city in a tower in the Danet section of the Capital Centre. The transaction was the largest in Abu Dhabi's recent history. The deal was struck at D1,250 per sq metre, below current market rates, because of the longer-term nature of the deal and size. Technip will be occupying an entire tower with 20,300 sq metres of space.