It was the top-performing area in the emirate in terms of last year’s fourth-quarter sales
Palm Jebel Ali is increasingly gaining interest from long-term investors, standing out as the top-performing area in Dubai in terms of last year’s fourth-quarter sales.
Industry executives say that investors are selling their units at premiums of up to 10 per cent to cash in on the gains following the three-year rally in the local property market. Following the success of Palm Jumeirah, Palm Jebel Ali is billed to be one of the next big destinations sought after by millionaires and billionaires in Dubai.
Master developer Nakheel Properties began launching villas on the upcoming Palm Jebel Ali in September last year, following the relaunch of the project by the Dubai government. Later, more villas were launched by the master developer, attracting very strong demand from local and foreign investors.
Some people are considering it as a future residence, but for most, it’s about potential capital appreciation given Dubai’s growth. There’s a lot of hope for investors.
With areas such as Palm Jumeirah ageing, investors see newer communities as this, the next big thing in that direction.
In terms of geographical performance, Mayed Al Rashdi, research analyst at Emirates NBD Research, said Palm Jebel Ali stood out as the top-performing area in terms of sales value in Q4 2023, generating Dh14.2 billion. Dubai Marina followed in second place with Dh8.3 billion, while Business Bay came in third with Dh5.1 billion.
“In the prime villas sales segment, Jumeirah Islands and the Palm outperformed their peers in 2023 with a surge in prices of 33 per cent year-on-year and 36 per cent year-on-year in December, respectively,” Al Rashdi said in a note.
Farooq Syed, CEO of brokerage firm Springfield Properties, said landmark developments like Palm Jebel Ali are pivotal in catalysing Dubai’s off-plan market dynamics as they are recalibrating market expectations for the luxury villa segment, establishing new pricing paradigms that are set to become the benchmark for luxury and strategic urban planning.
“Palm Jebel Ali stands at the forefront of this shift, embodying a blend of luxury, innovation, and sustainability meticulously designed to meet the standards of today’s global investors. With Dubai’s real estate sector registering Dhs35 billion in sales in January 2024, and off-plan sales witnessing a 25 per cent year-on-year growth to approximately Dh15 billion from Dh12.2 billion in January 2023, it’s clear that developments like Palm Jebel Ali are shaping the future of luxury living. This trend is not just transforming the Jebel Ali district but is also a testament to Dubai’s position as a top destination for high-end investment,” said Syed.
Liam Chase, senior developer property consultant at Allsopp & Allsopp Group, said the response to Palm Jebel Ali has been positive from buyers and investors! “We’ve seen the launch of six fronds, and around 95 per cent of the properties have been sold – which shows strong promise for the area… With the soaring demand seen across the launch of the first frond, two more fronds were launched to meet the market demand. Although, there hasn’t been any significant change in pricing,” Chase said.
“In terms of buyers’ preferences, we have seen a big influx of long-term investors seeking out future investment prospects, seeking waterfront living where they can step out directly onto their private beach. That’s their long-term vision – to create a community similar to what exists on the Palm Jumeirah, but with a much newer and more modern style,” Chase said, adding that the majority of buyers we’ve seen are investors.
Allsopp & Allsopp Group’s senior consultant said that many investors in the market are selling at premiums of 5 per cent to 10 per cent. However, resales have proven to be challenging due to existing stock with the developer that is yet to be sold.
United Arab Emirates Dirham Exchange Rate
