Apartment sales by Emaar Properties, Dubai's largest property developer, fell 86 per cent in the third quarter from a year earlier as sales and construction activity slowed in the emirate.
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Revenue from apartment sales dropped to Dh183.3 million (US$49.9m) from Dh1.33 billion in the third quarter last year, according to Emaar's detailed financial statement filed yesterday.
The drop was partially offset by an increase in villa sales, to Dh126.4m compared with Dh30.3m in the third quarter last year. Rental income also rose to Dh526m, from Dh435.7m last year.
Emaar had previously disclosed that its profit for the quarter was down 34 per cent to Dh406m compared with Dh612m in the third quarter last year. Revenue fell 33 per cent, from Dh2.7 billion to Dh1.8bn for the quarter.
Mohamed Alabbar, the Emaar chairman, acknowledged the Dubai property market would remain "challenging" for the next two or three years, but said housing prices were starting to improve. In an interview with Bloomberg TV last week, he said: "Frankly, I think prices have stabilised and in certain pockets of the city, they are moving upwards gradually so it is all good news."
Apartment sales were once the core of Emaar's business, including the development of the Dubai Marina. Last year the company was handing over apartments in Burj Khalifa, the world's tallest building.
But sales transactions have dropped and prices for apartments fell more than 50 per cent since the peak of the market in 2008.
Most of Emaar's tower projects started in the boom years have been completed. Emaar's total revenue from apartments sales fell to Dh823.8m for the first nine months of the year, compared with Dh5.1bn in the same period a year ago, an 83 per cent drop.
But Emaar said its recurring revenue from the hospitality sector, including hotels, grew to Dh224m in the quarter, up from Dh196m a year ago. And revenue from sale of offices and land rose to Dh2bn for the first nine months of the year, compared with Dh1bn for the year-earlier period.
Analysts said the drop in property sales was in line with expectations. The growth in international sales was regarded as a positive for the company's outlook.
Emaar has started handing over homes in projects in Egypt and it expects to start delivering properties in Saudi Arabia in the "upcoming months".
Last month the company launched a subsidiary to focus on affordable housing in the region.
In his interview with Bloomberg, Mr Alabbar said Dubai "is and would remain" Emaar's primary focus.
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