UAE Resumes Trade Relations with Qatar. What does it mean for the Real-Estate Sector?

Ending its three-and-a-half-year split, Qatar is finally back into the GCC family. The restoration of relations will attract invaluable investments from affluent Qatari investors into the UAE. This will have a significantly positive impact on the economy and is also much-needed for the recovery of UAEs retail and hotel sectors. 

UAE’s Stand on the Matter:

The UAE joined Saudi Arabia, Bahrain, and Egypt on Jan 12, 2021, in signing an accord with Qatar during a summit of Gulf Cooperation Council (GCC) leaders. The UAE government has already announced to reopen its borders and airspace with Qatar after a long conflict and has already commenced the commerce and travel with Qatar.

The trigger behind this move was Saudi Arabia announcing to settle its long conflict with Qatar and restore diplomatic ties and its allies will follow suit during the annual Gulf Arab summit which took place on January 05, 2021, in Saudi Arabia’s desert site of Al-Ula.

Why is Qatar So Important for the UAE Real-estate Sector?

According to the World Bank, Qatar’s economy is expected to grow 3% in 2021 and is amongst the fastest growing economies in GCC nations. Qatar is the richest country in the world in terms of per capita income. The country is expected to attract billions of dollars of investments as it is slated to host the FIFA World Cup in 2022. Qatar will be investing a major part of these investments in the real estate, tourism, and hospitality sector across the GCC nations which will also spur the growth of the UAE economy.

Qatar has been a second home for UAE businesses. They have a long tradition of operating in Qatar as the country offers a significant cost-advantage and access to the consumer base of 2.8 million. 

Here are the top four reasons that make Qatar a Key to Success for UAE Real-estate:

  1. Investments: Prior to the severing of ties in 2016, Qatari investors were amongst the top 10 most active investors in Dubai’s residential market. As per the figures released by Dubai Land Department (DLD), real estate transactions from 2016 exceeded AED 91 billion from 55,928 investors. This included 1,006 investors from Qatar purchasing a property in the emirate. 
  1. Tourism: Qataris have one of the highest spending-power in the world and an affinity towards luxury properties which is expected to underpin stronger demand levels in this market segment. An exponential surge in the inbound tourism in Dubai from corporate and leisure travel from Qatar will have a favorable impact on Dubai’s commercial as well as the residential property market.
  1. Trade: Qatar has huge trade with the UAE. The total trade with the UAE stood at $3.5 billion just before the year the embargo was imposed in 2017.  
  1. Economy: The restoration of relations will also have a profound impact on the UAEs economy. The reopening of Emirati airspace to Qatar ahead of the 2022 FIFA World Cup, will attract over a million soccer fans from across the globe which will bring considerable revenue for UAE airline companies and will be a big boost for the real-estate sector as well as for the economy. 

The resolution will also enhance the prospects of optimum utilization of socio-economic benefits of international air connectivity.

The Impact on the UAE Real-estate Sector:  

The real estate sector in the UAE will be the biggest beneficiary from the end of a diplomatic crisis with Qatar as the country is amongst the top investors. It will foster a free flow of capital in the UAEs regional marketplaces.

The industry experts believe that the UAE real estate and infrastructure sector will gain a lot from the deal as Qatar. UAE is expected to witness an exponential surge in its investment as high-spending Qatari tourists which were previously key consumers of UAEs luxury goods and hospitality services are getting ready to spend their fortunes on experiencing UAE’s lifestyle. Furthermore, the move will also open doors for UAE companies to operate in Qatar’s rich market which has one of the highest consumer spendings in the world. The deal will also work wonders for Qatar as it will leverage UAE’s geostrategic to gain wider access to the markets. 

The experts also believe that if things become normal between the two nations, there can be an incremental trade growth of 10% which is indeed a ‘glad tidings’ for the UAE real-estate sector.

5 Technologies that will reshape Real-Estate in 2021

No one can deny a strong bond between the Real-estate Industry and Technology. Technological developments have led to momentous improvements in the functionality of buying & selling platforms. Their operations and accessibilities have become much simpler and user-friendly for everyone associated with the sector. It is now a cakewalk for the landlord to get through to their potential tenants or homeowners and vice-versa. Buying & selling platforms are swiftly and hassle-free, catering to the requirements of every stakeholder, right from a real-estate agent looking to sell a property, to a landlord in search of his dream tenant or prospective homeowner. 

Whether it is for construction purposes, property management, home services, buying, selling or renting, the implementation of technology has drastically revamped the process of interaction for all associated parties. Today technology is touching the lives of everyone associated with the UAE Real- estate industry. In the last decade, technological advancements have impacted every aspect of the sector, with several breakthroughs achieved in the past 4-5 years. 

Here are the top 5 technologies ready to transform the future of the UAE real-estate sector: 

Blockchain: 

Blockchain technology has worked wonders in supporting cryptocurrency and tokenization. The UAE real-estate head honchos are all set to reap the maximum benefits of tokenization as it facilitates landlords in selling portions of ownership in their properties using the Blockchain technology. Tokenization allows buyers and sellers to prepare real-estate contracts with comprehensive encryption and built-in legitimacy checks. Furthermore, the blockchain ledger feature facilitates the landlords in easy and secure storage of property titles.

Virtual Reality:

In this era of Coronavirus pandemic, Virtual Reality (VR) is making headlines for all good reasons. VR allows the associated parties involved in the sales & purchase of property to take a look at its condition from the comfort of their home. Virtual Reality also facilitates easy implementation of social-distancing norms by curtailing any need of physical visits of the property. Thus, VR protects all the parties involved from being affected by any type of pandemics such as Covid-19, seasonal influenza, or any communicable disease. Some of the other unique benefits of VR include – improved customer experience, personalization, low-cost, global reach and better ROI.

Machine Learning: 

Machine learning (MI) is acting as a panacea for real estate professionals in making a huge business transaction. It allows the top leaders in making smarter investments and real-estate deals that assure optimum utilization of their time & money. The implementation of agile & innovative machine learning software is making it easier to make accurate predictions about the best-selling properties in the coming days, the future price of the property and rent rate, and in calculating the commission’s rate. As per the research conducted by the global management consulting firm, McKinsey & Company titled – ‘Getting ahead of the market: How big data is transforming real estate’, machine learning applications designed for the real-estate sector can predict changes in rent rate with 90% accuracy and the changes in other property metrics with 60% accuracy rate.

Artificial Intelligence (AI):

In the last few years, Artificial Intelligence (AI) has become the heart & soul of the real-estate industry. It is widely incorporated in every application used in the sector for automating tedious tasks. As per the research conducted by professional services firm – PricewaterhouseCoopers (PwC) titled How AI is pushing man and machine closer together, businesses are using artificial intelligence to eliminate repetitive tasks such as scheduling (79%), paperwork (82%), and timesheets (78%).  

The implementation of AI converts raw data into actionable insights to make it easier for all the parties involved to find, view, sell, or purchase properties. Artificial Intelligence has improved user experience several folds by simplifying the decision-making process involved in the property search. AI-powered software recommends the properties to the users based on their preferences such as location, current trends; value, etc. and thus, driving user engagement. Furthermore, the usage of AI-powered Chatbots assists real-estate professionals in swiftly answering the queries of their prospective customers.

5G:

5G is all set to revolutionize the real estate industry. It means the fifth generation of wireless technology. 5G is the fastest and most robust technology the world has ever seen. The implementation of 5G is creating truly wireless workplaces and commercial buildings with higher bandwidth. The modern tenants and homeowners are prioritizing security. They prefer to live and work in secured buildings that are protected with advanced cameras and sensors. 

With the help of 5G, it has become easier to connect cameras and sensors and produce high definition images to transmit them instantly anywhere.

Final Words: 

Emerging technologies are streamlining the complex processes of the real-estate sector by creating newfangled platforms to connect buyers, brokers, sellers, and lenders. Amid coronavirus, the real-estate professionals will widely adopt virtual reality (VR) platforms to walk their potential customers and clients through to the properties and in funding upcoming real-estate projects. 

The magnitude of emerging technologies in the real-estate sector has increased at an exponential pace. In the coming years, we will witness a substantial surge in real-estate firms investing their fortunes in developing software applications that most closely predict the future buying and selling trends. This will protect the real-estate sector management from colossal losses incurred due to inaccurate decisions as well as from future uncertainties.

Stuck in Property Handover Delays? Here is All You Need to Know

Finalizing a property management company has never been a cakewalk. It is indeed a rigorous and careful process that requires evaluation of various important factors such as – cost, ROI, expertise, and above all capability and track record of the firm in handing over the keys to the investors on time. In the last few years, there has been an exponential increase in the number of new home handovers in the UAE. This has intensified the competition, with more companies offering handover services. Thus, it becomes more crucial than ever before to critically analyze their offerings and evaluate their strategy to mitigate any sort of property handover delays before selecting the right one.

Kaizen AMS ensures that you don’t regret your decision. We possess almost three-decades of experience in executing a smooth and swift handover process with complete protection of the property and better returns. Ensuring the property gets its best care and stays in good shape always remains the top agenda of our property managers.

What Makes the Handover Process Challenging?

The handover is quite simple and straightforward. However, in many cases, the momentous process of property handover becomes a headache for investors. The key villains are – ineffective management, limited support, and poor customer service offered by the developers. The complex procedures and hidden charges further make the handover norms more difficult to understand for the investors. Several property developers will simply send out the completion notice and demand investors for handover within a month or levy hefty risk penalties. This causes innumerable stress to the overseas investors and to those who have waited for years for the completion due to repeated delays in the construction process. The developers must have a well-defined process in place to minimize the challenges for the investors and avoid any delays in the construction process.

Top Reasons for the Delay:

The key factors responsible for the delay in the handover process are as follows:

Short-term Completion Notice

Once the building construction is completed and achieved the required certification, investors receive a 30-day notice of completion from the developer. During this period, investors are expected to clear all outstanding dues on the property price and other statutory fees to take possession of the unit as the new owners. Several other obligations are also required to be completed before the keys of the property are handed over. The process above looks alluring however it comes with a series of challenges for many investors. It is very frustrating for many investors who have waited for ages to reach this point and are now provided with merely 30 days’ time to stump up the final payments. It is not always easy for the overseas investors to make payments within this short period and also to come to Dubai to complete these final handover formalities. 

Pending Final Payments and Paperwork:

Along with the completion notice from the developer, the investor also receives a handover pack with key details on the completion date and the account statement. The account statement reflects the total amount paid to date as well as the amount due to take possession of the property. The percentage of final payment varies from developer to developer, however, the closing cost remains standard throughout. 

In most cases, the major cause of the delay in the handover process is the pending final payments and the paperwork from the investor’s side. To avoid handover delays, the investor should have paid all the required fees before the handover date of the project, and have submitted the relevant documents to the developer. 

Cancellation of the Project by RERA:

One of the biggest reasons for the delay in the handover process in Dubai is the cancellation of the project by the Real Estate Regulatory Authority (RERA). The projects are canceled by RERA when the land is affected by planning or re-planning projects. In that case, the projects are transferred to the liquidation committee and then to the Dubai Real Estate Court, which handles the settlement of rights and liquidation to purchasers. It is always advisable to check the status of the project timely on the Dubai Land Department website under the tab ‘Project Status’.

Heavy Penalties: 

This stage requires the investor to clear the final balance due on the purchase price of the property, as per the terms and conditions of the sales contract with the developer. Penalties are levied on the account and in case of non-payment by the investor, the developer has a right to apply to the Dubai Land Department for the termination of the unit, depending on the breach of the sales agreement with the investor. It is always advisable to make the payment within the deadline to not risk losing the unit.

Ways to Avoid Delays in the Handover Process:

There are several ways the investors and buyers can implement to minimize the risk of delayed property project handover. 

Conduct Proper Research about the Developer:

It is pivotal to conduct an in-depth and thorough research about the developer before planning to purchase the property. Potential Investors must research the developer’s track record of completing projects and handovers as per schedule. It is certainly wise to talk to other investors and visit the project site to get the real picture of the project. 

Check for the Developer’s Escrow Account: 

As per Law (8) of 2007, it is mandatory for all real estate developers in UAE to have an Escrow Account which is registered with Dubai Land Department (DLD) to sell off-plan units. The investor must ensure that the developer has an Escrow account by visiting the DLD website and searching for the relevant project. All the payments made by the investor to the developer must be deposited in the registered Escrow account.

Check for Necessary Permits:

Before starting dealing with the developer, an investor must ensure that the developer possesses all the requisite permits and approvals from Dubai Land Department to market and sell off-plan properties.

Thoroughly Review the Clauses in the Contract

The potential investor must thoroughly review all the clauses stated in the Sales & Purchase Agreement to protect his interest and rights under any unforeseen circumstances. Before signing the contract, it is important to review whether the developer has mentioned all the provisions and plans to manage any kind of handover delay in the contract.

Check for RERA’s Registration:

Potential investors must check whether the project and the developer are registered with the Real Estate Regulatory Agency (RERA) before investing. Mostly the developers which are registered with RERA have a great track record of completing the project handover on time. This information is readily available on the Dubai Land Department website.

The Secret Behind Swift Handover Process at Kaizen 

Kaizen recruits highly professional property inspection experts to carry out all the tasks associated with the handover process. They are highly trained in performing comprehensive checks of each property. Our property inspection experts offer prior notice to the developers on the expected completion date of the project. Post that, Kaizen’s handover team performs rigorous site visits at regular intervals subject to the first notice from the developer on the completion of the project. Later, our Developer & handover team collect information details of the project, client details, DEWA premise numbers & financial reports, and issue invoices to all clients with an outstanding balance. The team is also responsible for preparing the first communication with all clients and notifying them of the Building Completion Certificate (BCC) date. They also provide the expected handover date along with Service Oriented Architecture  (SOA). The Community and Owner’s association team is responsible for preparing clients’ service charge invoices and delivering them at the BCC date. Post that, guidelines are provided within a 30-day notice, and invoices are prepared and sent to clients. Subjected to testing and commissioning completion, the developers deactivate all units’ DEWA accounts. Lastly,, the handover team collects unit keys, access cards, remotes, etc. This process is not only systematic but very cost-effective too and also ensures that the handover process with Kaizen becomes a ‘memory to cherish’ for our investors.

PropTech – An Innovative Way to Conserve Energy & Curtail Cost

Energy prices are soaring at a substantial rate and becoming a cause of concern for global corporations. Not only developing nations, but even developed nations of the European Economic Area and North America are facing the brunt of rising energy prices. The energy prices in Sweden and Norway increased between 20-25%. Denmark, Belgium, and Germany are not far behind. The prices for household electricity were around €30 per 100 kWh in all three EU nations in the second half of 2019. There was an overall increase of 1.7% in the EU in 2019 compared to the previous year. 

The energy prices remain fair in UAE due to the massive subsidies offered by the government. However, these subsidies are costing a fortune to the region and are slowing down the pace of its economic growth. According to the leading consulting firm, Strategy& Middle East, in the last two decades, the Gulf States have spent over US $120 billion on energy subsidies, while in the UAE, the accumulated figure stands between US $7-10 billion. The current pricing structure is not sustainable in the Gulf region and if it continues, the region will incur an extra cost of US $150 billion on energy subsidies. 

The energy prices won’t bring any relief and will continue to surge in the coming days. The efforts are being laid to explore novel solutions for conserving energy and reduce extortionate energy bills. One such solution is PropTech.

PropTech: Meaning and Significance

PropTech is a widely used term for property technology. It commonly refers to leveraging information technology infrastructure to assist corporates and individuals in buying, selling, and managing real estate. PropTech streamlines the real estate sector processes by connecting buyers, brokers, sellers, lenders, and all the parties involved using virtual reality to walk through properties and funding upcoming real-estate projects. PropTech is transforming the small property management firms or businesses in UAE through technology, by changing the way individuals buy, rent, sell, design, construct, and manage residential and commercial properties. The evolution of PropTech is to continue, with several new PropTech initiatives leading the way in UAE such as – smart cities and buildings (Smart Real Estate), the sharing economy, the home building industry (ConTech), and the finance industry (FinTech). ConTech and FinTech are considered to have close ties with the real estate industry.

The Need for PropTech

A vast majority of energy is consumed in office space and they have emerged as a new colossal ecosystem of energy consumptions. According to Green in Future, the buildings account for approximately 40% of global energy consumption. The urge for PropTech can be realized from the fact that around 60% of buildings in the world’s fastest-growing cities are yet to be built by 2050. This will further increase energy consumption by several folds. 

Offices are quite infamous for inefficient use of energy which leads to the wastage of millions of hours of monthly usage and also escalates the energy prices. Extreme climatic conditions are also responsible for raising the consumption of electricity at offices. However, it is crucial to create an environment to monitor the energy consumption of the buildings and undoubtedly, PropTech can play a decisive role in making this happen. The implementation of PropTech is facilitating modern architects in creating eco-friendly buildings and in maximizing the usage of their materials through unique construction designs. PropTech has been instrumental in the development of Green Buildings which minimizes the consumption of energy and also reduces the overall energy cost.

Win-win Game

PropTech is a win-win game for the corporate as well as the developer. It enables the firm to cut the cost and create a brand image of an environment-friendly company. The implementation of green technologies will result in developers gaining ‘Green building certifications’ without hassles, which will assist real-estate firms in targeting elite clients with deeper pockets.

PropTech in Energy Conservation & Cost-reduction

PropTech plays a decisive role in the creation of smart buildings. Smart buildings are the structure that uses technology to automate a building’s operations including lighting, heating, and security. Smart buildings increase efficiency to minimize energy waste. PropTech has also paved the way for the ‘smart city’. The concept of the smart city refers to urban development that integrates information and communication technology (ICT) with IoT solutions to manage a city’s assets such as information systems, schools, transportation, water, and law enforcement, etc. PropTech also facilitates the collection of data to improve the efficiency of urban informatics and technology and in minimizing the energy and operational cost.

PropTech conserves energy by automatically adjusting the lighting, temperature, and ventilation based on the requirements at a particular time. The research suggests the energy expenditure accounts for almost 19% of the total operational cost of a building. For most of the small-scale and medium-size companies, a 10% reduction in energy can positively impact their profitability by 1.5%.

PropTech also curtails building operation costs by almost 18% by fluctuating the ventilation level depending on the number of occupants at a particular time. The retail firms use sensor-based footpath tracking to assist their store managers in effectively planning the staff at a particular time based on the customer flow, adjusting product placements, and managing inventory as per the demand. 

‘Dubai’ Model:

Dubai is indeed a perfect example of a smart city where PropTech has worked wonders in reducing the extensive usage of energy, water, and other important natural resources. Dubai planners have leveraged smart-city technology to redesign the flow of the city. They have closely monitored the noise and air quality by making use of sensors, smart parking, and smart streetlights. Dubai planners have used advanced smart systems to conserve energy and have also partnered with emerging PropTech startups to harvest and conserve energy and data. PropTech solutions available today in Dubai are equipped with agile wireless sensors that are transforming the face and fate of the smart building sector.

KAIZEN Asset Management Services – a Dubai based, top five property management firm in UAE, leverages its decades of collective industry experience in executing energy conservation methods for its clients. We propose unconventional energy-saving initiatives to the clients and ensure that the property operates at the highest level of efficiency to curb operational expenses. 

Capitalizing on its unique capability, energy conservation, and sustainability initiatives, KAIZEN has won the trust vote of the biggest names in the industry such as – Emirates REIT, Meraas Estates, Emaar Properties, Nakheel Properties, Mazaya, Tamniyat, and Constellation Holdings. We ensure the building meets the strict energy regulations as part of a comprehensive sustainability initiative.

Routine Maintenance through IoT

PropTech is backed by advanced Internet of Things (IoT) technology which automatically performs routine maintenance checks to detect malfunctions before they become critical and also alerts the engineering team on the issue. PropTech exercises automated control on the buildings to ensure optimum utilization of energy and space to ensure minimal energy bills.

Minimizes CO2 Emissions

A wide range of newfangled software on PropTech has been launched to assist industry head honchos in efficiently addressing their energy needs and in minimizing the impact of CO2 emissions. The quality of materials used while constructing the building majorly determines the level of CO2 emissions. The PropTech software uses advanced Artificial Intelligence (AI) during the building design stage to quickly produce the best and most environment-friendly building design which consumes the least energy and reduces energy bills. The PropTech software also tracks the energy wastage and the impact of the operations on the air quality using agile cloud-based platforms. It delivers quick information to the engineering team when the building exceeds the set environment benchmarks which can also increase its energy consumption and fluctuate the organization’s energy bills.

Final Words:

PropTech is the key factor in minimizing the environmental impact of the building. With rising emission levels and deteriorating environment quality, international governments and environment-safety bodies are incorporating PropTech in their economic decision making. PropTech has not only enabled global corporations in curtailing their energy bills but in avoiding extortionate financial penalties levied by the government for excessive consumption of energy. The effective implementation of PropTech will lead to the development of eco-friendly buildings and minimize the energy consumption of a building by 50-60%. It also assists in combating the retarding effects of global warming. There is an urge for the industry to create accurate value metrics to measure and evaluate the impact of PropTech on energy savings and cost. This will encourage several other firms irrespective of the size, to adopt and embrace it.

Smart Ways for Owner Association Firms to Reduce Service Charges

With the rising impact of Covid-19 on the job market, remuneration, and businesses, property owners in UAE are demanding a reduction in service charges. There has already been a huge payment backlog of service charges, and owner association management firms are navigating the ways to overcome the situation.

A Massive 75% Decline in the Collection of Service Charges:

According to Gulf News – a leading daily English language newspaper published from Dubai – since February 2020, the payment collection of service charges has declined by almost 75% with the majority of the tenants holding Coronavirus responsible for the non-payment. As per the notice issued by Dubai real estate regulator, Real Estate Regulatory Agency (RERA), all such payments should be paid by the tenants to ensure the upkeep and well-being of the community. However, residents have different views altogether. 

Several residents interviewed by Gulf News stated that service charges should be reduced as most of the facilities they pay for under service charges such as gym, pool, tennis or squash courts, sauna, clubs, etc. have been closed due to Covid and not been used. Thus, they should not pay for them. Other tenants stated that the service charges should be reduced on the grounds of an exponential decline in property value. 

Can OAs Reduce the Service Charges?

Technically, It is not feasible for the OAs (owner’s association’s) to reduce the service charges. They are in the stage of distress as the payment backlog piles up. Service charges are an operational cost and have nothing to do with the fluctuations in the prices of property or rental value. The top head honchos of OA firms believe that it is not possible to reduce or waive the service charges as that is the amount that goes towards the upkeep of the properties and cannot be escaped. For instance – the cost of maintaining a swimming pool will remain the same as the quantity and the price for chemicals, cleaning, daily maintenance, labor cost, etc. will remain standard. The same is the case with other facilities. In fact, the Coronavirus pandemic has increased the operational cost for the OAs as their utility bills surged several-fold due to a rise in demand from the residents for increased sanitization and disinfection in a building. 

Thus, OAs are under the impression that they are entitled to collect service charges even if the services are not used by the residents as maintenance and operational cost for them remain fixed.

Best Practices OAs Can Adopt to Reduce Service Charges:

Here are the top ways for owner’s association firms to curtail their service charges:

Focus on Sustainability:

The owner’s association firms must invest significantly in introducing newfangled sustainability programs and energy efficiency initiatives to reduce the overall cost of operations. They can also organize a formal review of the real estate portfolio every year to identify unique ideas for cost savings.

Leveraging Govt. Schemes:

There has been a list of schemes and economic incentives launched by the UAE government on new facilities, space renewal, and capital expenditure. The owner’s association should make the best use of these schemes to minimize the overall operational expenditure.

Releasing Guidelines for Vendors:

OA firms should design and release their guidelines for all vendors that align with their sourcing strategy. This will not only reduce the cost but also add value to the operational process. 

Identifying the ‘Dark Space’:

Owner association firms should identify space in the current portfolio that is not used or under-used, also called ‘dark space’, and work towards eliminating it. This will reduce the operational cost by several folds for the OAs and they can pass the benefit to tenants by reducing their service charges. To achieve this it is of paramount importance for the owners association firms to conduct an energy assessment of each individual site and identify the areas to improve efficiency.

Making the Best Use of Technology:

Owner’s association firms can take advantage of facility technology such as – computer-based maintenance and predictive maintenance techniques to prevent any possibility of equipment damage which involves expensive repairs. They can also use novel software and dashboards to analyze the current usage of existing lighting systems and retrofit lighting fixtures to minimize the cost of energy. Automation of the dashboard will allow OAs in keeping a birds-eye control of the cost incurred and saved and will remove the need for manual reporting.

Effective Benchmarking:

The owner’s association must benchmark their operational cost against their closest competitors to find out the areas of improvement. They must also implement cost benchmarking and competitive bidding techniques to cut down the costs of renovations or fit-outs.

Govt. Initiatives to Reduce Service Charges:

The UAE government has taken a list of measures to minimize the financial burden on tenants and homeowners of properties due to the adverse situation caused by a coronavirus. These initiatives are as follows:

Reduction in Service Charges:

With a core objective to cut down the cost of owning a house in UAE, the Dubai Land Department (DLD) has instructed the Owner Association (OA) firms to closely review all expenses and cut down service charges in Dubai. Furthermore, DLD has decided that any fines on non-paid overdue charges on service fees in Dubai between 2019 to 2020 will also be waived off as part of the plan. Property owners will also be eligible to pay off their service charges via installments.

Reducing the DEWA Utility Bills:

As a part of the AED 1.5 Billion stimulus package to support businesses during the Covid 19 pandemic, the Crown Prince of Dubai, His Highness Sheikh Hamdan bin Mohammed Al Maktoum has launched an initiative to reduce DEWA utility bills in Dubai. Under the initiative, the Dubai Supreme Council of Energy has issued a directive to reduce the fuel surcharge for electricity and water. The reductions will be applied to electricity and water bills with effect from December 1, 2020. Fuel surcharge for electricity will be reduced by 23% reduction and for water, the surcharge will be reduced by almost 33 %.

Rent Relief in Dubai:

The developers and landlords have announced rent relief packages in Dubai for their commercial and residential tenants which are adversely impacted by the restrictions from the Covid-19 outbreak. Due to the shutdown of several UAE venues due to the pandemic, landlords of retail and commercial tenants across Dubai have announced rent relief of up to three months for eligible tenants. The initiative was led by Meraas with an AED 1 billion package for commercial tenants at their developments such as City Walk, Bluewaters Island, and La Mer, among others. Al-Futtaim Group also implemented this initiative and unveiled rent relief of up to three months for retailers at Dubai Festival City Mall.

The Future of the UAE Property Market under Biden’s Presidency

A thrilling win of Former US Vice President and the President-elect Joe Biden in the 2020 US Presidential elections is perceived as a panacea for the UAE economy which is currently battling with Covid-19. Banking their hopes on the next ‘World Leader’, the head honchos of the UAE property sector have announced billions of Dirhams of new construction projects. The industry looks confident of the promising growth in 2021 and in years to come.

The two biggest news of the year 2020 – Mr. Joe Biden’s win in the US Presidential elections and the approval of Covid-19 vaccines from pharmaceutical firm Pfizer will have a profound impact on the UAE real-estate sector. The glimpse of the positive impact of Biden’s win on the UAE Property market was very evident from two macro-metrics i.e. a 15% rise in the price of Brent crude and a 10% fall in the US Dollar Index from its March 2020 safe haven peak. The gurus of the UAE property sector have given their trust vote to the predictions of robust growth of the sector under Joe Biden’s presidential term between 2021 to 2024.

President-elect Biden has shown a strong commitment towards working with the World Health Organization (WHO) to prevent the infection. The development & distribution of the Covid-19 vaccine both in the US and internationally is expected to get impetus under Biden’s Presidency, which will enable the world to swiftly overcoming the after-effects of the pandemic. This is indeed a positive sign for the UAE economy as well as for its real-estate sector which has already lost billions of dollars of investment to the pandemic due to the postponement of the World Expo 2020 to next year.

Biden May Unwind China Trade War in Favor of UAE:

President-elect Joe Biden can take a strong stance on China, however, is expected to reverse most of the superfluous protectionist methods implemented by the Trump government. The top agenda of Biden’s government will focus on Intellectual Property Rights (IPR), forced transfer of technology, and a rising trade deficit of the US with China. The political pundits predict that until the US economy overcomes the catastrophic effects of Covid-19, the Biden government may unwind the China trade war in favor of a return to global growth. This will indeed be a ‘glad tiding’ for the UAE economy which relies heavily on global trade. The UAE economy will be benefited from its economic ties with both China and the US. The economy will also lead to a surge in investments in the UAE real-estate sector which will arise from policy changes under the Biden government and the approval of the Pfizer Covid-19 vaccine.

Biden’s Win Will Foster International Investments in Dubai Property Market:

US President-elect Joe Biden’s win has spur optimism in the UAE property sector with several elite investors lining up to invest in the Dubai property market. A vast majority of investments are coming from the Indian & Lebanese expats, who are buying villas at the prime locations of Dubai. According to the figures released by the Department of Land and Property in the first week of November 2020, Dubai has recorded a total of USD 789.5m (AED2.9bn) in real estate and property transactions. A total of 854 apartments and villas were sold for USD 405.66 million (AED1.49 billion) and 44 plots were sold for USD 48 million (AED176.48 million). The total number of transactions crossed 1,241 in the first week of November 2020. As per the report, the Properties developed by some of the prestigious clients of Kaizen AMS i.e. – Emirates REIT, Meraas Estates, Emaar Properties, Al Fattan, Mazaya, Tamniyat, and Constellation Holding topped the overall sales charts.

UAE Property Sector to Benefit from Weak Dollar:

Despite taking several revolutionary measures to revive the US economy from the most difficult times (such as – global financial crisis in 2008-09),  the former US President – Barrack Obama and his Vice President Mr. Joe Biden has always been under fire for poorly managing the value of the US dollar in terms of other international currencies.  The US Dollar witnessed its all-time low value under the leadership of Barrack Obama-Joe Biden administration. Several Wall Street and Federal Bank economists predict that until the foreseeable near future, the value of the US dollar will continue to diminish under Biden’s term as the US President.

A weak dollar will give a stimulus to international tourism in the UAE and other emerging markets, resulting in the exponential surge in the demand for accommodation. Real-estate firms will increase the construction of more residential skyscrapers, hotels, etc. to cater to the requirements of the global tourists, which will attract significant investments to the sector.

Biden’s Presidency is a New Hope to ‘Abraham Accord’ Treaty:

President-elect Joe Biden has been instrumental in stabilizing the US relations with the Middle East and Africa in his term as the Vice President of the US between 2009 to 2017. The political experts believe that Biden’s presidency will be a big boost for the ‘Abraham Accord treaty’ between Israel and the UAE which has been inching toward normalization in recent years. The treaty aimed at establishing peaceful, diplomatic, and friendly relations, co-operation, and full normalization of ties between the two nations. As a result of the Abraham Accord treaty, Israeli athletes have participated in regional competitions in the UAE which has improved the relations between the two nations. From the business perspective, the treaty has encouraged Israel to take part in Dubai’s World Expo next year which will attract billions of dollars of investment from Israel’s companies into the UAE economy with the real-estate sector expected to be one of the biggest beneficiaries. The World Expo 2020 is now scheduled to take place in October 2021 due to the coronavirus pandemic.

Final Words:

Biden’s government agenda revolves around every key topic which has a direct or indirect impact on the fortunes of the UAEs real-estate sector such as – climate change, renewable energy, small caps, and infrastructure. Joe’s strong commitment towards coordinating with the WHO for faster development, distribution of cost-effective vaccines for Covid-19, and strengthening ties with emerging economies, are perceived as silver lining by the UAE Property sector experts.

UAE Approves 100% Ownership of Businesses by Expats – What’s the Impact?

In another historic decision, the UAE Cabinet enacted the long-anticipated Foreign Direct Investment law (FDI Law). The laws are intended to liberalize the onshore legal ownership regime and foster a favorable business climate for foreign investors. The widely discussed reforms were approved by the President, His Highness Sheikh Khalifa bin Zayed Al Nahyan.

Focus Area:

The new FDI law amends 51 articles and added new ones with a prime focus on the regulation of provisions of forming companies with limited liability shareholding. The amendments exempt expatriate investors from the minimum percentage ownership of UAE nationals. The FDI law will allow UAE to leverage a fertile legislative environment for the establishment of businesses with an objective to improve the UAE’s competitiveness.

How Do New FDI Laws Impact the Emirati Population?

The FDI laws are positive news for the UAE population where every 8th person out of 10 is an immigrant, and they long had their ownership capped at 49% in firms outside free zones. Several other legal amendments were also passed which removed the quotas requiring Emiratis to hold the majority of board positions and serve as chairs for onshore companies. Companies interested in being publicly traded can now sell up to 70% of their shares instead of the current 30% limit. The experts believe that these amendments will diminish the appeal of 45 “free” zones across the UAE, and attract those wanting to avoid local-hiring quotas and retain full foreign ownership.

The cent percent ownership by foreign nationals of companies licensed and registered in the UAE is allowed as per Cabinet Resolution No. 16 of 2020. In the last few years, individual emirates allowed foreign national owned companies to acquire the remaining stakes on a case by case basis. The new FDI laws substantially extend the scope. However, the new laws are also considered to be a massive blow to the long-established rentier benefits for Emirati citizens as a wide majority of them made their living as figurehead company partners.

Effective date:

The FDI law came into effect as of December 1, 2020. The foreign ownership amendments can come into effect within six months. Possibly, the companies can also take up to a year to begin complying with the new changes.

What was the Trigger?

The primary objective behind the introduction of FDI Laws and other revolutionary measures taken by the UAE government recently is to revive the economy from the disruptions caused by Covid-19. The global pandemic has postponed high-profile events, such as the ‘World Expo’ – 2020’ to next year which has aggravated the situation for the UAE economy as the government already spent billions of dollars in organizing the event. The World Expo-2020 was supposed to be attended by 25 million visitors. 

To overcome the catastrophic impacts of these disruptions, the UAE government has started offering significant relaxations to the Islamic legal code, Cohabitation laws, and restriction on alcohol consumption from the beginning of November 2020. The introduction of these measures will have a fruitful impact on the national competitiveness of the UAE.

The presidential decree which amends the corporate law will enable UAE to strengthen its position globally as one of the most attractive investment destinations in the world for global corporations. According to the new FDI regime, several categories of business licenses will no longer require Emiratis as sponsors with 51% shareholding rights as of December 1, 2020. 

Impact of FDI Laws on the UAE Real Estate Sector:

The Foreign Direct Investment law will allow foreign investors 100% ownership of businesses. In simple terms, now foreign investors and entrepreneurs can establish their own companies without involving local shareholders. These reforms are expected to be a game-changer for the investment landscape. Experts believe that FDI reforms will attract substantial investments to the UAE and spur the growth of the real-estate sector. There will be an exponential rise in the investments in the real-estate sector which will bring additional revenues, result in job creation and economic growth.

The triumph of the real-estate sector also means a positive impact on the businesses of property management firms like Kaizen AMS. The company is amongst the top 20 property management firms in the UAE, providing professional, newfangled, and end-to-end solutions in Property Management, Community Management, Owner Affairs, Unit Management, and Handover Services to some of the biggest real-estate brands such as – Emirates REIT, Meraas Estates, Emaar Properties, Al Fattan, Mazaya, Tamniyat, and Constellation Holdings. Kaizen AMS is a proud winner of several prestigious industry awards including the most recent  Superbrands 2018, Gulf Real Estate Awards 2018 for ‘Best Employer in Real Estate’ and ‘Best Consultancy in Real Estate’.

Creating Memorable Experiences to Increase Occupancy

Being amongst the top property management firms in the UAE, we at KAIZEN Asset Management Services (KAIZEN AMS), offer specialized end-to-end solutions in Property Management, Community Management, Owner Affairs, Unit Management, and Handover Services. Our managed properties maintain some of the highest occupancy rates in U.A.E. as we always strive to ‘Create Memorable Experiences’

These memorable experiences we build have a long-lasting impression in the minds of the tenants of the buildings we manage. They rejoice every moment – from the time they have spent at the gym to the neighbors they have met. They remember the ease of parking, greenery, and fresh air, cleanliness, ambiance, and above all the cooperative staff.

We Create Memorable Experiences: 

Kaizen’s managed properties are known across the UAE for their state-of-the-art facilities. We work towards maintaining warm lighting, heart-touching music, perfumed lobbies, and better utilization of space, along with inspirational quotes on the walls to maintain a positive and encouraging environment that fosters creativity, happiness, and above all creates ‘Memories’.

Kids Club: 

There is always a special place for the little ones – the ‘Kids Club’. To recreate memorable spaces for the kids, we transform storage areas into a place where they can spend time, play, grow, foster creativity, and learn new things every day. 

Kaizen Inspires Community:

We inspire a better way of living through ambiance in the buildings by offering on-demand hospitality. Additionally, some of our most commonly enjoyed services by the tenants are car wash, maintenance, parking management, access management, visitor management, and a one-click payment solution for service charges, utility rent, and ultimately – peace of mind.

With the goal of developing and achieving happier communities, we inspire change at home and promote resident engagement. This is done through community, sporting, or festive events, wellness sessions such as yoga and gym classes frequently to maintain a healthy happiness index in our managed properties.

Some of our popular community events include:

Krafty Kids:

Krafty Kids’ event offers an exciting opportunity for kids to learn artworks, paint, and enjoy an afternoon of fun and games, and make new friends.

Family Day:

Family Day is an event that provides a unique chance for every resident to get to know his neighbor and have a fun time with them. This event enhances the relationship and bonding among the residents to create unforgettable memories of a sense of community.

Movie Night:

An outdoor movie night is an ideal event for our residents to enjoy watching movies together and have a wonderful evening in their backyard.

Valentines Day:

Kaizen AMS believes in spreading love within its communities, and Valentine’s day is indeed the best time to do that. We cherish this auspicious festival of love by sending a beautiful bouquet to our residents with a heart-warming message.

Even unprecedented situations such as COVID 19 couldn’t deter our commitment to the wellness and safety of our tenants. Due to this commitment, we are currently organizing the events virtually on a weekly or monthly basis. Furthermore, to ensure that tenant satisfaction remains the top agenda for our portfolio managers, we evaluate their performance on the outcomes of ‘Community Happiness’.

Why Choose Kaizen?

The credit for maintaining some of the highest occupancy rates goes to the distinctive and visionary leadership of KAIZEN. Thanks to our dedicated team of researchers who perform an in-depth market analysis on the UAE’s Rental Index and consumer behavioral patterns, we design plans to implement the findings of the research effectively to set competitive rents. Furthermore, we believe in offering modern and most desired services by the tenants to our managed properties to ensure our tenants get the worth of what they are spending. 

Backed by a vast network of dedicated portfolio leasing agents and marketing strategists for marketing the properties of our clients 24x7x365 days, we strive to ensure that our properties maintain the highest occupancy rates with a special emphasis on retaining tenants. KAIZEN AMS possesses decades of experience in designing unparalleled tenant retention strategies that have worked wonders for the landlords and tenants in the past. 

For more information on our Property Management Services, please get in touch – propertymanagement@kaizenams.com 

New Cohabitation Reforms Likely to Boost UAE’s Real-estate Sector

In a historic and unprecedented move, the UAE Government has unveiled a series of changes in its Islamic personal laws. The new law permits unmarried couples in UAE to stay together without any consequences. Until now, it was illegal for unmarried couples or unrelated flatmates to live together or share a home in the UAE. The new rules are applicable with immediate effect. The laws pertaining to alcohol consumption, divorce, and women’s rights have also been relaxed. 

The core objective behind these amendments is to make the UAE more welcoming for expats and tourists. Cohabitation reforms will fuel a flurry of commercial activities in the UAE as it gets ready to host the World Expo in Dubai which is expected to be attended by more than 25 million international visitors and will attract billions of dollars of investment into the economy. The high stake event was pushed back a year because of the coronavirus pandemic and will now take place in 2021.

The Impact of New Laws on UAEs Real-estate Sector & Economy

The experts perceive the changes made to the UAE laws as a giant leap in the process of granting greater personal freedom to the residents as well as to the UAE’s 88% population of expats. The introduction of cohabitation laws will have a favorable impact on tourism to the UAE and will spur the demand for both commercial and residential accommodation in the region. This is indeed very positive news for the UAEs real-estate and property management sector. Furthermore, hiring a trained and qualified workforce has been a long-standing challenge for the UAEs real-estate and property management sector. Relaxing the cohabitation laws will allow the sector to retain the top talent into local businesses.

The relaxation in cohabitation laws will also attract an influx of Israeli investors to substantially contribute to the UAEs real-estate sector following a historic US-brokered deal to normalize relations between the UAE and Israel. The real-estate sector will also be positively impacted by the reinforcement of UAEs position as the most attractive and tolerant places to live within the Middle East region, which would open new avenues of international investment and business opportunities in UAE. These changes will also help revamp the local legal landscape for expats which is expected to have a positive impact on the overall economy and will also boost international investor’s confidence ahead of the World Expo.
The approval of new laws will protect individualism and foster foreign direct investment (FDI) in the UAE. According to the prominent media firm – Bloomberg, cohabitation laws are part of UAEs efforts to attract foreign experience and investment and play a pivotal role in building the open-minded image of the UAE. They will also open doors to millions of international tourists, fortune-seekers, and businesses to the UAE which is already very popular across the globe as a skyscraper-studded destination.

OYO Life: ‘Thriving on the Idea of Cohabitation

OYO Life is India’s long-term fully managed housing rental solution company. The company was founded on the idea of cohabitation which is forbidden in most of the residential accommodations or hotels in India and in many other countries where the company operates. The implementation of unique thought of cohabitation in India made Oyo Life one of the most successful startups in the country and a preferred choice of youth for accommodation. 

Banking on their idea of cohabitation and offering budgeted accommodation to the youth, OYO Life clocked 4.5 times year-on-year (YoY) growth. The six-year-old company increased revenue to US$951 million for the fiscal year 2019, from US $211 million in fiscal 2018. In just a span of two years, Oyo Life has more than 10,000 units signed and over 6,000 live beds and is adding over 1000 new beds every month.

OYO Life success was later replicated by several other budgeted hotel chains in India such as – LuvStay and StayUncle who went on to taste the triumph. 

OYO is one of the finest examples of how cohabitation can work wonders for a housing rental firm and simultaneously benefit other related sectors. The relaxation of reforms in UAE will make its real-estate sector more attractive for the world, foster tourism, bring valuable foreign exchange, positively impact the revenues of the real-estate sector, and will enhance the international image of UAE.

How to make your investment property stand out from the crowd in the Dubai Real Estate Market

Making your rental property stand out to potential reputable tenants is an essential first step in securing a consistently high return on your investment. The current market is flush with options for renters, and expectations are high. Quality tenants expect features such as energy efficient appliances, centralized urban locations, and bright open spaces. The great news for the owner is that this generation is mobile and seem to want to rent for extended periods of time.

Put your best face forward

Getting your property into top form is key in attracting quality tenants to your investment. Presentation, appearance, and general maintenance of your property will go a long way in setting your property apart in this renter’s market. Investing just a few thousand dirhams into basic property maintenance can make a significant difference when it comes to the number and type of tenants you attract. Small changes can make a big difference in your property’s first impression. Start in a small area like the bathroom. Replace shower heads, toilet seats and reseal worn out edges. Look through the rest of the property for things that can easily be fixed or updated. Replace basic fixtures with new designs, remove older switches and sockets and put on a fresh coat of paint and you can give your property the makeover it needs to make the grade. For a bit more, replace old doors worktops with sleek, modern designs, and update scuffed floors to change the entire look of a space. Oftentimes, these small changes can change the look and feel of a property and help you to retain reputable tenants who will stay long-term.

Location, location, location

The neighborhoods of Dubai are both vibrant and diverse. Renters and buyers are going to want to live in a neighborhood that reflects their interests and lifestyle. For example, Arabian Ranches is known to be a great area for young families, whereas Dubai Marina has a more metropolitan vibe, and appeals to young professionals the go for the outdoor lifestyle. Good tenants will want to stay in your property long-term and will want to see that the neighborhood fits their style. In your listing, be sure to include details about the surrounding locations like supermarkets, access to public transport, schools and restaurants. Going above and beyond by providing a welcome package or area guide for new tenants can turn a short-term renter into a long-term reputable tenant.

Have the right people on your side

Hiring a reputable property management representative will save you time, money, and headaches along the way. A quality property manager will assist you to maximize rent, minimize expenses and increase the resale value of your investment. Reputable property managers will support your investment by managing the day-to-day tasks that steal away your time like marketing, determining rental rates, managing small tenant disputes, inspecting properties, screening tenants, and collecting rents. Your property manager should also manage your property listings, and ensure that all available properties are listed with quality pictures and an enticing written description. If you are managing your property from outside the UAE, a locally-based property manager is essential.

Be flexible

In this rental market, it is important to offer flexibility and value-added services to your tenants. The Dubai trend of demanding payment in one cheque is on its way out, and we are seeing multiple-cheque options pop up in suburban areas like Jumeirah Village Circle, Dubai Sports City, Damac Hills and more. Offering a one-month free option is also a great way to expand your pool of potential tenants. To add value to your rental property, consider outfitting your investment with high-quality modern appliances and smart home technology solutions like smart lighting and smart thermostats. Smart home technology can benefit landlords, tenants, and the environment!

Monitor your activity

Your leasing agent or property management representative will send you weekly reports on your property’s activity if requested. Ensure that these reports are detailed, including how many times your property was viewed and the number of leads generated. Give your agent feedback on the quality of the report, and be sure they optimize the document with the data that you require. These insights are critical to ensure that your listings are properly managed.

Experts expect that an additional 30,000 units will be handed over by the end of 2019. Avoiding the vacancy cycle will take forethought and quality property management. The Dubai economy is maturing, and tenants expect well-maintained properties and flexible payment rates. Stay flexible and add value to your properties to ensure long-term tenants and a steady return on your property investment.