Dubai Properties Group, one of the UAE's biggest developers, is calling on developers and municipal authorities to clamp down on property speculation.
Dubai Properties call on developers and Government to stop speculation
Having been burnt in the global economic downturn, Dubai Properties Group (DPG), one of the UAE's biggest builders, is calling on developers and municipal authorities to clamp down on property speculation.
"Speculation has to be dealt with properly," Khalid Al Malik,DPG's group chief executive told The National at this week's Cityscape.
"As DPG we don't give people what they ask for," he added. "I mean, we will restrict them sometimes for a unit only. If he asks for five, we don't give [them to] him. There is demand as you know. If you have, for example, 100 units and you have people that want 500, why should you give someone 20?
"It's much better to give only one or two maximum. So that's what we at DPG do as a developer. The developer has a responsibility also to somehow stop speculation. And regulation could play a part in stopping it. You cannot stop it 100 per cent but I'm sure you will have an influence on it where we could minimise the damage."
But things are looking up for DPG, the developer behind plans for Mudon [cities in Arabic] in Dubailand, a vast plot of land - about 6.5 million square metres - which was announced at the top of the market in October 2007 amid plans for 3,200 villas and 8,500 apartments.
The developer announced last month it would restart work on the first phase of its Mudon project, 15 minutes' drive from central Dubai, within the next 18 months. And this week Mr Al Malik said he was convinced that the developer would sell out of the two buildings it was marketing at its Business Bay scheme during the Cityscape exhibition.
"For the time being our objective is to go with this first phase of Mudon and again watch the market," said Mr Al Malik. "If demand is there again we will probably go with another batch. And that batch is really dependent on the market.
"We're not going to announce 4,000 or 10,000 or 20,000. So we will be very realistic in terms of market demand and supply. We will be careful about it. Today the market has changed. People, knowledge has changed. The maturity of the market has changed. Bodies are there to govern the market. The infrastructure has changed in areas. The influence on companies like us is immense."
Mr Al Malik said that the company would initially complete all the projects it put on hold during the global financial crisis, including Mudon and its Business Bay Park commercial scheme. Then it would concentrate on key drivers of demand, including middle income buyers.
"It's the biggest portion of the demographic of the city and we cannot ignore that," he said. "I think that class has the money, they can invest. There is a demand which is very clear from this class and I think it is our responsibility to respond to that." He added that the company was also likely to focus on hospitality, luxury and retail projects in the future.
"Money is power and when you don't have that it's difficult. Supply and demand completely collapsed during the crisis," said Mr Al Malik.