The first part of Jumeira Gardens that could start construction next year would be an island off the coast of Dubai called East Bay Island.
Green shoots for Jumeira Gardens
Cityscape Dubai may be more exciting this week than people have been predicting, as Meraas Development emerges from a hiatus brought on by the property slump to announce a plan to move ahead with its Dh350 billion (US$95.3bn) Jumeira Gardens project. The development, planned for the Satwa and Al Wasl areas of Dubai, will probably take longer to develop than originally planned, but it will "move forward", said Sina al Kazim, a senior executive at Meraas Development.
"The markets are changing, but there is still a demand in the market for certain types of products," he said. "We are concentrating on those areas, like residential villas - We are looking to the times when the recession will be over." The first part of Jumeira Gardens that could start construction next year would be an island off the coast of Dubai called East Bay Island, which would include high-end villas designed by Tony Owen Partners, an Australian firm.
Tony Owen, the founder, said the villas would be the "most contemporary single residences in Dubai, and some of the most luxurious as well". East Bay Island is one of the islands being created for the Jumeira Gardens project. "These islands would basically be a continuation of the city, but with waterfront all around." Mr al Kazim said Meraas was focusing on building the infrastructure needed by the project. "Infrastructure is a critical element," he said, adding that the company was prioritising areas near stations on the Metro line as the earliest parts of the project to proceed.
The return of Meraas to launch the project comes after a difficult year for executives, who have had to deal with a sharp property downturn that took hold just as the company was officially announced. Meraas officially launched at Cityscape Dubai 2008 with a luxurious room full of futuristic design, including a hanging garden suspended between two sets of buildings and a super-tall structure that was made up of three buildings connected by sky bridges. The project was among the most spectacular announcements of the five-year property boom in Dubai.
But the launch coincided with the beginning of serious difficulties in the property market. With a credit squeeze spreading across the globe, property sales in the UAE dried up and projects stalled in the midst of construction. The proposition of a new development company vying for business during this period was a serious problem for Meraas, according to insiders. It had been hiring dozens of new staff members to handle what it had predicted would be a busy year of investment, construction and sales. But within months of launching at Cityscape, Meraas started to downsize and put its signature project under review.
"Meraas never really reached its potential before it was forced to scale down," said Vikram Batra, the former head of corporate finance at Meraas Capital, the other half of the company. He has since left the company and has returned to India. The company was founded in 2007 by Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai, as a spin-off from his own Engineer's Office. "Very early in the company, we decided that it should be split into two basic parts: capital and development," Mr Batra said. "While the development side would focus on Dubai and the Jumeira Gardens project, investment was on a global scale."
It was Meraas Capital that made the first headline-grabbing announcement in June last year, months before Meraas Development rolled out its massive project. The company said it had joined up with Boston Properties, a real estate investment trust (REIT), and Goldman Sachs to buy the General Motors building in New York City for $2.8bn. The price was the most ever paid for an office building in the US.
At the time, Meraas was eyeing several other trophy buildings around the world, but with the economic crisis landing on the shores of the Gulf the GM Building turned out to be the only deal the company would make. As prices of property started declining worldwide, both the investment and development arms of the company slowed down to re-examine their future, Mr Batra said. @Email:firstname.lastname@example.org