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London, a safe haven for Dubai’s property investors

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London’s property market continues to attract Arab investors, who have directed their investment power towards foreign markets or are interested in buying family vacation homes abroad.

“[London] is seen as a safe haven for investment, given the clear and secure legal structure and real estate regulations,” Will McKintosh, director of the Joint Head of Residential MENA Region at JLL, tells Aficionado.
“The London market is also seen as a very stable one with safe, steady investment returns over the long term,” he adds.
Arab investors have poured in billions of dollars into London’s real estate market over the past few years, according to reports from several UK-based property firms.

Most of the investments, made by wealthy Arab individuals or organisations, were poured into central areas of the UK capital, such as Knightsbridge, Chelsea, Mayfair and Belgravia, but the interest has spilled over the traditionally golden addresses.

“We have witnessed increasing interest from Middle East investors outside the traditional ‘golden postcodes’ of Belgravia, Knightsbridge and Chelsea, in areas of ‘New London’ such as The City and Shoreditch. This interest is driven by a desire to spot new-growth areas and benefit from higher returns,” said Tim Wright, director – Residential at JLL, the selling agents for Principal Tower.

This week, a new luxury apartment complex built in London’s Shoreditch is being unveiled to Dubai-based investors in the emirate.
Upper House, designed by world-known architects Foster + Partners and comprising the top 30 floors of Principal Tower, London’s new landmark and the latest iconic complex, houses a mix of residential and office space, retail facilities and a half-acre public piazza.

Principal Tower consists of 50 stories reaching a height of 175 meters, which makes it one of the tallest residential buildings in central London.
Upper House is the world’s first luxury apartment complex fully designed by Foster + Partners architects, famous for their work internationally and within the Middle East region. Al Faisaliah Complex in Riyadh, Kuwait International Airport, Masdar Institute, Zayed National Museum and Reem Island Residential Towers in Abu Dhabi are among projects designed by the architectural firm in the GCC region.

The Principal Tower project is developed by Brookfield, Concord Pacific and Q1 Developments in joint venture.

Since Dubai’s property market crash of 2008, local and regional property investors have generally been quite cautious when pouring money into developments in the emirate.

With analysts’ warning of a possible new property bubble, general sentiment and confidence is not quite strong yet, but has been slightly supported by the continuation of previously suspended projects and announcements of new ones.

In 2014, the number of residential property sales in Dubai dropped 41 per cent, compared to a year earlier, according to an industry overview released by global property agency and consultancy, Knight Frank.

“The overall residential market remains relatively subdued in the UAE, as the stability witnessed in the last quarter of 2014 continues into 2015,” McKintosh says.

 

First published on Aficionado, sister publication of Luxurymena.

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