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Deyaar eyes encore with hotel apartment sales

Dubai: Deyaar Development Co is looking for a repeat performance as sales open on Saturday for the first hotel serviced apartments from it, at The Atria twin-tower project in Business Bay. There will be 162 of these units available for investors, with Deyaar deciding to retain the other 163 apartments for its own portfolio.

Online registration by prospective investors is already on a high, with more than 400 doing so in just over 48 hours of bookings being opened. Recently, the 219 freehold apartments at The Atria were sold out in six hours flat, providing a significant boost for the developer when it came to testing the investor waters. This netted proceeds of Dh500 million, with most of the units quoted at the Dh1,700 a square foot. [This is also higher than the average for residential units within Business Bay, where the average is now around Dh1,250 a square foot.]

The price of the serviced apartments which now go on sale were not disclosed. The Atria’s design and interior touches is being overseen by the UK boutique firm yoo Studio. Completion of the 30-storey tower is scheduled for the first half of 2017.

“Deyaar’s mid-term plan is to have 50 per cent of hotel serviced apartments in our portfolio in the next three to four years,” said Saeed Al Qatami, the company’s chief executive. “It’s a conscious move on our part to develop our interests in serviced apartments rather than fully-fledged hotels — the main factor is that this can be done at a lower operating cost than for hotels.”

 

Better returns

He added that this model is also a better fit for Deyaar as a company operating on Sharia. “Plus we see the market as getting oversupplied with hotel units, while that’s not the case for serviced apartments so far. Even now, there’s only the odd hotel property offering this category in Dubai.

“Going forward, lots of companies flying in personnel on short- to medium-term projects would prefer the convenience of serviced apartments for their stay. For an investor, it is an opportunity to acquire an asset that can provide better returns,” he said.

All of the top-notch developers in Dubai now have serviced apartments within their project portfolio. Damac is making a steady headway with the Maison branding.

Deyaar, at the moment, does not plan to create an individual identity for its offerings. “We have had big names interested in managing The Atria hospitality component; tie-ups would bring us the knowhow and creates scope for future joint ventures,” Al Qatami said.

 

*source Gulfnews

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