Property executive Fred Durie has been associated with some of Dubai’s highest profile — and priciest — developments for much of his 30-year career in the UAE.
Having trained as a civil engineer, Mr Durie landed a job at Dubai Municipality back in 1986, before moving to Emaar in 2001, where he gained experience on mega-developments such as Downtown Dubai, one of the costliest places to live in the country, writes Ben Flanagan.
He has now turned his attention to a market segment that, though not as high-rise or headline-grabbing, has similarly lofty potential: affordable property.
Mr Durie left his role as chief executive of Emaar International in August 2014, and now heads up Nshama, which is behind the Town Square development in Dubai.
The under-construction project, located about 22 minutes from Dubai Mall past Arabian Ranches, seeks to address what analysts have long identified as a gap in the market for properties geared towards “middle income” residents.
Nshama is selling one-bedroom apartments for Dh499,000 and townhouses for Dh999,988 – well below the asking prices for similar off-plan properties in Dubai.
In this exclusive interview with Benchmark, Mr Durie described the future potential of the affordable property sector both within the UAE, and beyond.
Q&A with Fred Durie, chief executive of Nshama.
Q: How is construction progressing on Town Square?
The construction of Town Square, our flagship project in Dubai, is progressing as per schedule.
We have started work on 1,050 townhouses and 1,100 apartments, even as other infrastructure work is being undertaken.Nearly a third of the total project, spread over 750 acres (31 million sqft) is currently being developed.
We have a very structured approach to the development, whereby when we welcome our first residents in 2017, they will move into a vibrant neighbourhood with all lifestyle amenities.
We are meeting a real market need — whereby for the first time, mid-level professionals have the opportunity to live their dreams
Q: How many units have been released and sold, and what is the schedule for future releases?
We have launched over 1,050 townhouses under Zahra and Hayat, and over 1,100 Zahra and Safi Apartments. Most recently, we unveiled Zahra Breeze apartments.
We have received an overwhelming response to the projects, selling well in excess of 2,000 units to date. With more than 3,000 villas and 18,000 apartments as part of the masterplan, we will announce new launches shortly.
Q: Nshama specialises in mid-income property – what typical price bracket does its homes fall into?
Nshama offers the unprecedented opportunity to ‘live at your own price’ in the heart of Dubai with our trendy Town Square development. Typically, we provide one-bedroom apartments at below half a million dirhams (Dh499,000) and three-bedroom apartments at around theDh1 million level.
We have also launched townhouses for as low as Dh999,988 apiece — the lowestpriced townhouses of its kind. This is unprecedented in the market.
Q: Several other developers have launched ‘affordable’ property schemes. How tough is competition in the market for lower-priced Dubai homes?
Nshama pioneered the concept of affordable communities and today more developers are entering the segment. This is only natural given the strong demand for middle income housing.
A conservative estimate is that the UAE has over 820,000 middle-income households representing about 40 per cent of all households in the country. Therefore, there is strong and real demand for affordable homes.
Affordable housing must not cost more than 30 per cent of the gross household incomes for households earning between Dh10,000 to Dh30,000 per month. We are meeting a real market need – whereby for the first time, mid-level professionals have the opportunity to live their dreams.
And what makes us different is that Town Square is a trendy, smart and thoughtfully designed neighbourhood that meets the aspirations of our customers.
Our strategy has been to shift demand pattern by encouraging investors to move from rental homes to own residences with all amenities in close proximity. The strong demand to our launches is a testament to the value differential that we assure to our investors.
Q: Does Nshama plan other developments in Dubai, and does it see any opportunities elsewhere in the region?
Yes, we will soon launch a new affordable lifestyle community through our joint venture with the Mohammed bin Rashid Al Maktoum Foundation (MBR Foundation). We will announce more details in due course. We see strong opportunities for affordable communities across the region, given the demand for value-homes.
Q: You’ve been working in the region since 1986, and so have witnessed the ups and downs of the Dubai property market. Do you think the rollercoaster ride will continue, or will the market be more stable in future?
There are two key trends that are evident today: The first is the maturing of the property sector whereby speculative practices have been checked thanks to the policies of the government and some of the leading developers that have been acting with responsibility.
Two, there is a strong demand for end-user homes, whereby investors are seeking to shift from a rental model to owned homes. The property market, much like other sectors of the economy, is influenced by the economic cycles but what works in Dubai’s favour is the strong diversification of the economy.
Dubai’s core sectors such as retail, tourism, hospitality, aviation and logistics are preforming well and recording robust growth; the economy is growing at an estimated 5 per cent. Further, the preparations for Expo 2020 Dubai is catalysing the economy and driving real demand for property.
Dubai’s diverse property landscape offers tremendous opportunity to keep learning. They must leverage the opportunity they have to further their skills so that they can add value to the development, Fred durie Chief Executive, Nshama
Q: From your 30 years’ experience in Dubai, what advice would you have for newly qualified civil engineers looking for opportunities here?
Continue learning: Dubai’s diverse property landscape offers tremendous opportunity to keep learning. They must leverage the opportunity they have to further their skills so that they can add value to the development.
Fred Durie is chief executive of Nshama, a Dubai-based private developer established in September 2014.
He oversees the delivery of master-planned, techdriven and sustainable neighbourhoods, including Town Square, Nshama’s flagship development.
Mr Durie has been associated with several mega-developments in the region, including multibillion-dollar projects such as Downtown Dubai and Arabian Ranchesin Dubai, as well as projects in Egypt, Saudi Arabia, Morocco, Jordan, Lebanon, Turkey and Pakistan, among other international locations.
Working in the region since 1986, Durie was previously chief executive of Emaar International and also served as its executive director of development.
Mr Durie is a civil engineer, and worked with the Dubai Municipality from 1986 to 2001. SOURCE: Nshama.ae.