FutureBrand's 2008 Gulf Real Estate Study

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The Gulf Real Estate Study showcases an ever-expanding category in a thriving development region. Generating a huge amount of interest and launched to standing room crowds year after year, GRES is an …

The Gulf Real Estate Study showcases an ever-expanding category in a thriving development region. Generating a huge amount of interest and launched to standing room crowds year after year, GRES is an extensive exploration and assessment of the real estate category in the GCC that examines the driving forces, trends and insights related to branding in the Middle East.

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  • 1. FUTUREbRAnD’S 2008 FutureBrand is a full-service global branding firm. Shaping with Strategy. Communicating with Design. Implementing for Impact and Reach. We build GULF REAL ESTATE real estate brands that aim to increase value and sales velocity, inspire wanderlust and fire imaginations – all over the world. www.futurebrand.com/gres STUDY Year four of FutureBrand’s Gulf Real Estate Study showcases an ever-expanding category in a thriving region. Global teams have assessed new trends, practices and accomplishments. Quantitative research was conducted exclusively for this Study. A matured focus, incisive points of view and extensive industry expertise have again resulted in the only comprehensive marketing assessment of the Gulf real estate industry.
  • 2. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY ARE YOU A FUTUREbRAnD? With unparalleled experience pioneering brands in the As our name suggests, a focus on the future is an essential region, FutureBrand believes that our expertise and not part of our branding process. This, combined with our just our understanding sets us apart from others. We are unique and proven brand philosophy, is how we help the only brand consultancy to deliver a powerful point clients create, deepen and mature brands holistically. of view, tools and methodologies tailored for the real A true “futurebrand” creates a new definition of brand estate and destination branding industry. excellence – a brand that thinks ahead to stay ahead. i wAnT... mAkE mE... AwAREnESS THE TAkE nOTicE ESSEnTiAL PREFER YOU DEciSiOn THE bUY/invEST ESSEncE FEEL SATiSFiED TELL OTHERS ADvOcATE PERFORmAncE TRAnSPAREncY AUTHEnTiciTY EmOTiOnAL EnGAGEmEnT wiDE cHOicES SEnSE OF PURPOSE DEciSiOn AnD FRAmEwORk mOTivATiOn AnD DESiRE The framework is linked to your brand’s maturity and how customers (existing and potential) view it on a We begin brand development by creating a strategic continuum from awareness to advocacy. This helps us framework that enables us to identify the core focus to understand how and why customers make purchase for your brand. This is customized for each of our decisions and determines what can trigger decisions clients and aims at optimizing your brand to deliver to buy or invest. The framework also considers what effectively. Using unmatched category insights and barriers the brand needs to overcome strategically and combined strengths in consulting and design, we define creatively. These insights allow your brand to be finely the opportunity and create a value proposition for your tuned to its audiences and their relative requirements. business and a visual expression for your brand that is We aim to build brands that contribute to high levels ownable, differentiating and lasting. We aim to unlock of customer advocacy. what customers desire. 1 2
  • 3. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY 2008 YEAR in REviEw cOnTinUinG nOTAbLES FROm 2007 This year has brought interesting events to the marketplace. Evidence of last year’s buzz of sustainability and green initiatives is still growing global economic volatility, government intervention and category maturity strong, and customers are still struggling to get answers, information and continues to be seen. New urbanism, the environment and ultimate living assurances. are trends consistent with a growing industry that is looking ahead, though corruption and increased regulation demonstrate the need for further While Dubai seemed a bit more subdued this year, Abu Dhabi continued to mORE GREEn THAn EvER RAmPAnT inFLATiOn SUPERSTAR bRAnDinG oversight and cast a shadow over the category. initiate large-scale projects and garner considerable attention. Development Green fever is still in the air, and sustainability Inflation remains a challenge for many in One-upping starchitects, celebrities like Brad in Bahrain slowed although the giant Diyar Al Muharraq was introduced. Oman and environmental awareness remain a top the Gulf. Oman saw it reach an 18-year high Pitt and Pamela Anderson are endorsing and Real estate in the Gulf seemed to offer more of the same this year. Countless had a strong year despite some issues with the Blue City project. And Qatar focus for regional developers. Examples of 14%, and a similar rate is attributed to helping to design eco-friendly projects in towers, smart office buildings, residential communities and retail malls remained one of the most steady real estate markets in the region. include Emaar’s Mishrif Heights and Qatar. Inflation in Saudi Arabia reached Dubai and Abu Dhabi. have been created. Luxury continues to be a dominant theme, although Dubai Properties' Mohammed Bin Rashid 10.6%, a 30-year high, while some predict Gardens. that inflation will soar to a record 12% in PRE-LAUncH TREnD cOnTinUES the UAE. Most major developers continued to gauge THE TOTAL vALUE OF REAL ESTATE PROjEcTS UnDER cOnSTRUcTiOn in A biRD, A PLAnE, A ROTATinG TOwER The 420-m Dynamic Tower will feature 80 DUbAi GETS FinE DininG market interest and reaction to pricing through soft or pre-launch events. THE Gcc iS mORE THAn US $2.39 TRiLLiOn1 apartments that spin, at voice command, 360 degrees around a central column Top chefs continue to open restaurants in Dubai. Michelin chef Guy Savoy is creating a DEvELOPER EXPAnSiOn nEwS AnD nOTEwORTHY by means of 79 power-generating wind restaurant at the Tiger Woods Dubai. Nobu is Last year’s trend has continued to progress, turbines located between each floor. on its way, as are additional upscale offerings with major developers announcing expansion It is slated to be operational in 2010. from Michelin chefs Michel Rostang and plans in the region and beyond. Emaar now Santi Santamaria. features offerings in Pakistan, Damac in Iraq, and Limitless in Jordan and Turkey. The GCC retail real estate market is the fastest-growing in the world, Abu Dhabi’s share of the UAE mortgage market is forecasted with more than 16.35 million sq m of gross leasable area (GLA) to increase to 22%, up from 5% in 2007. 10 nEw nOTAbLES expected to be complete by 2010.2 The construction sector currently contributes 5% of Saudi Arabia’s The UAE was recently ranked fourth overall in global land sales, US $278 billion GDP.11 jumping 23 spots since the same time last year. The UAE now claims 5.8% of worldwide real estate sales, propelled by a whopping More than US $180 billion of investment is needed in Saudi Arabia’s increase of 1,348% since 2007.3 real estate sector to meet expected demand for housing projected mORE bRAnDS…EvERYwHERE wHAT HAPPEnED TO EXcLUSivES? HOTEL EvEnT LAUncHES for 2015.12 Developers seem to be going to market Exclusive partnerships and associations seem As space and construction costs in the region Mortgage lending in the UAE, which opened its property sector to with a growing list of associated or partner to be a thing of the past. While Trump Tower continue to skyrocket, many developers foreign investment in 2002, almost doubled in 2007.4 Real estate transaction volumes in Kuwait decreased by 65% in July brands. These range from amenities to is actively being promoted by Nakheel as the have begun to stage significant launch events 2008, marking the fourth consecutive month of decline following finance partners and can sometimes result most expensive property in Dubai, this does in five-star hotels to wait for the completion Dubai’s land transactions totaled US $39.3 billion in just the first new regulation banning residential property trading. The total in customer confusion about which is the not seem to stop Donald Trump from being of – and in some cases, replace – sales half of 2008, and are on the way to easily surpass the US $50 billion value of realty sales during May 2008, as compared to May 2007, lead brand. linked to Hydra Properties. centers. mark – the total completed during all of 2007.5 declined by 36%.13 OTHER EmiRATES SHinE AUcTiOnS TRAnSPORT wiTHin DEvELOPmEnTS Roughly 3,000 towers (both mid- and high-rise) will be in various The government of Qatar has allocated 10% (US $7.3 billion) of its Major developments are taking shape Auctions are becoming a more common Developers across the region are embracing stages of planning, design, development and construction in Dubai projected expenditure for the year toward infrastructure investment outside the usual real estate hotspots in such way to sell. Jumeirah Golf Estates has long localized transport networks as a way to ease between now and 2025.6 aimed at facilitating its burgeoning real estate growth.14 cities as Ajman and Ras Al Khaimah, which used them effectively to garner record-high the flow of traffic within their developments, wisely promote themselves as weekend spots prices, and this year Nakheel held auctions leading to pedestrian-friendly areas. Shanghai, with a population of 20 million, and Moscow, with a The Omani construction sector will grow at 8.7% per annum during or calmer respites. Ajman also recently with the Golden Mile and Canal District, as Examples include Downtown Burj Dubai, population of 10.4 million, currently have approximately the same the period from 2008-2012, and is expected to reach a value of introduced a law allowing foreigners to did Emaar for villas in Arabian Canal and City of Arabia and The Palm. amount of office space as Dubai, a city of 1.6 million.7 US $2.5 billion in 2012, which would contribute 4.7% to the own freehold land and gained notoriety plots in Emirates Hills. Omani GDP.15 with Al Zorah. YOU bUY iT, YOU kEEP iT Abu Dhabi’s real estate sector boasts total project values of more iPO FEvER Both Aldar and Nakheel are restricting than US $460 billion.8 Considerable growth in the Omani real estate market is expected biG PLAYERS RE-bRAnD There has been talk of IPOs for major players “flipping” and placing limits on the resale of to continue, with the value of demand exceeding US $20.8 billion Some major developers have re-branded this Damac and Nakheel as well as the property their properties in an effort to curb market Abu Dhabi experienced a 200% increase in the commercial real by 2010.16 year, notably Deyyar, Damac and Al Burj. arm of investment bank Ithmaar. overheating. estate rental sector, reportedly the highest in the world.9 3 4
  • 4. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY EmERGinG TREnDS THE PRAcTicAL THE FUn THE nOT-SO-FUn EmERGEncE OF ASSET mAnAGEmEnT bRAnDS PRivATE PERFORmAncES nO mORE RESiDEncY viSAS DELAYS, cAncELLATiOnS AnD cOncERnS As communities get completed and residents move in, the notions Developers are pulling out all the stops to attract buyers, especially Dubai has agitated many homebuyers by no longer guaranteeing Above and beyond the usual delays, several prominent developers of community maintenance requirements and owners’ associations to high-end products. Dubai Pearl flew 150 potential investors to residency visas for property purchasers. It has been reported that have canceled (or tried to cancel) projects due to unanticipated have begun to gain momentum. Special groups have been created Paris for a private Elton John concert, while Desert Dream brought some master developers have recently removed this clause from upsurges in building material and labor costs and overly ambitious by many developers (Nakheel Asset Management, Emrill, Wasl), but recording artists Enrique Iglesias, Elissa and Raghav to Dubai for a their contracts.18 designs. Others have felt the sting of unhappy investors and this still appears to be an area that most do not spend time or money private concert hosted by ex-footballer Ian Wright. Nurai’s launch customers who have taken their complaints public. In Dubai, on. As a result, critical customer communications are often handled in Abu Dhabi included helicopter flights and a Lionel Ritchie FOREiGn PROPERTY invESTORS LOOkinG ELSEwHERE intervention is likely the reason that more developers have not with black-and-white photocopies attached to a blackboard. performance. Gulf domestic investors appear to be top players in the regional abandoned projects. Notable projects experiencing issues this year: market after current economic conditions and Gulf prices have Damac’s Palm Springs project, Dubailand’s Plantation Equestrian EnTERTAinmEnT LURE caused many foreign investors to look for cheaper opportunities. and Polo Club, Blue City in Oman, Sokook’s Ivory Towers and Entertainment-based developments continue to be on the rise. Legislative measures to combat property price inflation – such as Schön’s Dubai Lagoons. Interestingly, some developments have also Boasting sporting venues and theme parks as central attractions, rental caps, trading restrictions and possible capital gains taxes – have been delayed or canceled due to fears about adequate infrastructure developments like Dubailand and Yas Island look to attract tourists, made Gulf property less appealing for some foreign investors. and utilities. These include Al Salam City in Umm al Quwain and while also being home to residential communities. Four years from Kuwaiti authorities have banned residential property trading in Al Ameera Village in Ajman. now, the UAE will have almost 30 theme parks. Kuwait is also an effort to curb inflation, while similar restrictions have been experiencing an amusement park boom, with recent announcements announced in Dubai. of a Cartoon Network–branded theme park and an Islamic-inspired heroes entertainment park called 99 Village.17 5 6
  • 6. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY cORRUPTiOn in Dubai, 2008 proved to be a year of shocking corruption REGULATiOnS ...and increased government measures in response major developers and related companies have February 2008 saw a new law issued by the government of Dubai in order to regulate the management of shared facilities in buildings to remove ambiguity about whether the developer or owner is responsible for such matters. fallen under scrutiny for alleged backhanded A new mortgage law was created to increase transparency to further protect the rights of buyers and lenders. The law stipulates that mortgage contracts deals, kickbacks, embezzlement and a slew of must be registered with the Dubai Land Department and provide all the details of the specific loan. A new Dubai property court was established to deal with civil cases related to real other charges. The government suggests that even estate. The new court will initially have 10 judges, who are currently undergoing training with the Real Estate Regulatory Authority (RERA) regarding the specifics of the Dubai marketplace. more charges and related regulations to prevent A property rental index that provides pricing recommendations for rental homes in Dubai will launch in early 2009, with the hope of preventing landlords from corruption are underway. exaggerating annual rent prices. Dubai’s Land Department passed a law making it compulsory for off-plan property sales to be registered with them. The law also bars developers from charging transfer fees for such sales. 9 10
  • 7. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY THE REGiOn AT A GLAncE mUScAT, OmAn The Gulf is continuing to show growth, with both Abu Dhabi and Dubai focusing on infrastructure to meet Ranked as one of the top 10 places to visit by the related needs of their developments. Overall, prices are climbing with middle-income end users Condé Nast Traveler, Oman is becoming the DUbAi, UAE destination of choice in the region.34 With often priced out of the majority of new offerings. Dubai is enjoying continued and unprecedented real estate major developments taking shape across the growth, with property prices rising by approximately 40% since country and numerous golf resorts already last year.30 The government is investing heavily in infrastructure, attracting international attention, Oman is set such as the light rail network set to open in 2009, as well as roads to increase its real estate sector considerably, and public spaces. Amid constant attention on the world stage, despite some well-publicized missteps with mAnAmA, bAHRAin Dubai continues to thrive. Approximately 25,000 people per Blue City. In fact, the volume of real estate Recently ranked as the best-positioned economy in the GCC, Bahrain is continuing month take up residence in Dubai: that’s 33 new people per hour deals in Oman has risen by nearly 50% in the development of its collection of projects, notably Diyar Al Muharraq. choosing to make the city their home.31 past two years.35 2008 Updates & milestones 2008 Updates & milestones 2008 Updates & milestones • Bahrain’s real estate market faces a record year in 2008, with an estimated turnover • Corruption charges were brought against staff members • The average price per sq m for residential land in of US $5.7 billion. This number represents a 58% increase in market transactions from of Deyaar, nakheel and Sama Dubai in cases unrelated to Oman increased by 253%, reaching US $135 per 2007, based on the first quarter’s results of US $1.4 billion.19 each other. sq m in 2007, compared to US $38 in 2005.16 • The government is delaying projects in order to curb inflation and attract investors.20 • Dubai Metro conducted limited trial runs of Dubai’s first-ever • The government introduced a 7% cap on • Diyar Al Muharraq, a US $3.2 billion mixed-use urban development that will be one of rail network, set to launch in September 2009. annual rent increases to protect tenants bahrain’s largest, was recently launched and is slated to break ground in early 2009.21 • Emaar plans low- and middle-income housing developments against record inflation.36 • Reef Island is expected to complete its first phase of construction in early 2009. in the UAE and abroad.32 • The government recently disallowed property • Bahrain Bay construction is well underway and plots have been sold to a variety of • Dubai Properties unveiled the US $60 billion, eco-friendly owners from issuing eviction notices to global developers. mohammed bin Rashid Gardens project masterplan.33 defaulting tenants.36 • Construction of Bahrain’s biggest mall, Bahrain City Centre, is now complete. By next • Nakheel launched the Veneto and Badrah districts of the newly • Old Town, a 36,000 sq m residential and year, its two hotels and an indoor/outdoor water park will open.22 re-branded waterfront, along with Dubai Promenade and commercial project in Ruwi, was launched; it • Marina West, Bahrain’s first gated beachfront high-rise residential and lifestyle The Lake District. features apartments and a bazaar. community, announced that the sub-structure work for all of its residential towers • Trump Tower launched as the centerpiece on Palm Jumeirah • Foreign ownership rights have been extended is complete and distinctly visible.23 with events in new York and california. to include non-Gcc nationals, but only in • 1000 villas from Durrat Al Bahrain, a US $3 billion mixed-use island development, • Burj Dubai, standing 900 m high, became the tallest structure certain designated areas.37 will be delivered in november 2008.24 in the world. • The US $1.6 billion Omagine resort received government approval. • The Blue City project failed to sell units and missed quarterly targets.38 • 85% of the advanced earthworks has been completed for Salam Yiti – Oman’s premier lifestyle resort project.39 • The Wave, Muscat will deliver 120 villas and DOHA, QATAR townhouses by the end of 2008, with residents Buoyed by rapid development of infrastructure projects and increasing incomes, Qatar’s development market moving in shortly thereafter.40 is looking strong. The country has been named as the world’s second-fastest growing economy in the property sector in 2008.25 2008 Updates & milestones • Qatar has agreed to freeze all rents signed since 2005 for the next two years. Prior to this law, Qatari landlords could raise rents between 5% and 20% on rental contracts signed before 2005, depending on the rental price.26 • The Qatar Real Estate Investment Company plans investment of US $2.75 billion in housing projects over the next five years.27 • Qatar’s biggest project, the Lusail development, which is organized into 17 districts and estimated to house 200,000 residents, has completed its conception stage. The infrastructure, including roads and an underground train network, is slated to be completed within the next three years.28 • Damac launched two residential towers at the Lusail development: Garden Heights and The Terrace at Fox Hills. • A total of 93,000 residential units are planned to be delivered by 2010.29 11 12
  • 8. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY THE REGiOn AT A GLAncE jEDDAH, SAUDi ARAbiA kUwAiT ciTY, kUwAiT Saudi Arabia made a splash in the region’s real estate sector with announcements of mega-projects Kuwait offers some interesting development opportunities despite that will become cornerstones of the country's future. Total real estate investments in government restrictions on property trading. Kuwait is expected to have Saudi Arabia, which is the largest construction market in the Middle East, are estimated at the third-largest supply of retail space in the Gulf, with an expected US $270 billion, and the total value of new projects is likely to reach US $410 billion this year.41 growth of 10% by 2010. 46 2008 Updates & milestones 2008 Updates & milestones • It has been reported that Saudi Arabia’s Shura Council has approved a draft of a long-awaited • Kuwait will build the world’s first sculptured skyscraper, Al Hamra, mortgage law. The law, which has been in the works for almost a decade, allows much wider access a commercial tower with two tilting walls. to property ownership in a country where only one out of five people own homes.42 • Silk City, a 250 sq km US $132 billion development, launched this year. • The construction sector currently contributes approximately 5% to the overall GDP.11 When complete, it will create 430,000 jobs and homes for 750,000 people.47 • Jeddah Gate, Emaar’s flagship KSA project, is said to be on schedule with its infrastructure work.43 • The Avenues, a shopping, leisure and business destination, is set to open in • Dar Al-Arkan was awarded a contract by the local authorities for the development of the Khozam 2010. The development will offer 140,000 sq m of retail space, including 10 Palace project. This multiyear initiative, to be executed through a joint venture with the cinemas, an entertainment complex, 39 restaurants, four-star hotels and a local authorities, is aimed at rejuvenating the area surrounding the historical khozam Palace, convention center.17 located in the center of jeddah.44 • Al Aqeeq Marina was soft launched by Hydra Properties at Cityscape USA. • Despite problems with excess water and coral reefs, the Lamar Towers project, slated to be the tallest building in jeddah, is on schedule.45 • Despite reports of being scaled back, designs for the Mile High Tower, slated to be 1,600 m tall and twice the height of burj Dubai, will be publicly unveiled in October 2008. AbU DHAbi, UAE Abu Dhabi has built its reputation from the ground up over the last few years. It is now moving aggressively to expand and has recently been ranked by Jones Lang LaSalle as a “power city” on its way to becoming a world-renowned “urban star.”48 2008 Updates & milestones • Expected to be operational by 2030, the new capital of Khalifa City will house all federal ministries in a 49 million sq m area. Project costs are estimated at US $40 billion.49 • Work has started on Yas Island developments. With a cumulative value of US $39 billion, the island will be a mixed-use development featuring golf courses, a Formula One circuit and a Ferrari theme park.49 • Nurai by Zaya, a community of limited edition resort beachfront estates and waterfront villas, was launched with a slick campaign and high prices.50 • Preliminary details have been released on a light rail project, currently in its study phase, which will span 350 km.51 13 14
  • 9. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY THIS YEAR’S BUZZ: THIS YEAR’S BUZZ: nEw URbAniSm Related to last year’s focus on the environment and sustainability, DESTinATiOnS On THE RiSE this year’s buzz has a slight nuance: the shift from theory to practice. Another buzzworthy feature this year was the rise of many New Urbanism has been behind some of the region’s major Gulf locations as destinations. not only promoting major developments. While the term varies in how publicly it is being used, some of the core practices should sound familiar to anyone developments and attractions, several cities and countries with real estate experience in the region. in the region have re-branded themselves or launched new Developed in the 1980s, New Urbanism is an American design trade and/or tourism-related campaigns. philosophy. Its purpose is to create sustainable neighborhoods that contain diverse housing and jobs, are walkable and encourage social interaction. Examples include Seaside and Celebration, both in Florida.41 bASic TEnETS • Neighborhoods have discernable centers, which could be a square or park • A variety of home types are featured • Shops and offices are nearby and satisfy the essential needs of the community • Streets within the neighborhood form a connected network • Developments are on a human scale • Access to, from and around the community is easy • Walkability is a major requirement There are many new projects in the Gulf using New Urbanism as part of their core message: “The population of city of Silk will live within 30 communities made up of “Designed around the needs of individuals, veneto is the waterfront district five to seven villages, with each community served by its own schools, where the most innovative principles of community design produce healthcare facilities and employment. weaving the fabric of these different a thoroughly comfortable and sophisticated environment…veneto is areas together will be a network of parks and lakes, with the designers divided into small walkable neighbourhoods where every amenity and promising that everyone living within the development will be no more convenience is only a short stroll from home, giving it a feel of comfort than three blocks away from open space.” and charm.”35 — "City of Silk," Arabian Business, 21 August 2008 — Veneto website “The mohammed bin Rashid Gardens represent the most innovative “Al Zorah…will be designed in accordance with the principles of approach to urban form to be found anywhere in the middle East… liveability and sustainability…This mixed-use development will establish Its 56 million square feet of verdant parks and gardens divide an 880 neighborhood communities, create synergy between activities and reduce million square foot city into a network of sustainable neighbourhoods, car dependence…The city center contains urban forms of five distinct each containing the molecule of daily life. Scaled around walkable types, with a mixed land use, predominantly residential above-ground distances that provide easy access to food, healthcare and education, floor retail, underground parking, pedestrian walkways, squares including this enlightened model of urban planning will help reverse the Gulf’s a major public square where large events can take place.” existing commuter culture that has eroded both communities and the — Al Zorah brochure environment.” — Civic Arts “The master plan for our canalside development bears all the hallmarks of a classic Limitless project. balanced, sustainable and planned around people, “conserving energy, using natural cooling and light, employing efficient it includes green, open spaces and distinctive residential, commercial, infrastructure, protecting water quality and ecologies, and creating retail and recreational components.” comfortable, walkable places are all part of [Palm Deira’s] design — Limitless press release on Arabian Canal vision.” — Calthorpe 15 16
  • 10. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY HYPERbOLE cOnTinUES TO REiGn SUPREmE “ULTimATE LUXURY” “imAGinE LUXURY LivinG TAkEn TO THE nEXT LEvEL. A PLAcE OF EXTRAORDinARY bEAUTY wHERE YOU cAn EnjOY THE bEST OF wHAT LiFE HAS TO OFFER.” “An ever lasting dream”“WheRe Life is PLayeD out to PeRfection” “youR oWn Piece of PaRaDise” “There is only one masterpiece” “THE mOST PRESTiGiOUS “Make this dream“Living “cREATED FOR A SELEcT FEw” “Be in the center of luxury, with a new lifestyle” ADDRESS... BIZ BAY” inTO YOUR your permanent ReinventeD” “mAjESTic LivinG AmiDST inSPiRED viLLAS” “mOvinG DREAm “Unbound luxury, bound by community” HOmE” address” “The benchmark of corporate luxury” “Quality par excellence” “ULTimATE PRivAcY AcHiEvED AmiD ELEGAnT SOPHiSTicATiOn” “a commitment to perfection” "a PLace to buiLD youR DReams" “FOR SOmE PARADiSE iS jUST A DREAm, FOR OTHERS DEFininGfocused on the proliferation of luxury, this year While last year we A UniQUE vOicE TOP FIVE OVERUSED ExAGGERATED WORDS: iT’S“WheRe LuxuRy meets PeRfection” THEiR ADDRESS” 1. Luxury we looked at extravagant claims a bit more broadly. Luxury is going “wHERE LUXURY iS EFFORTLESS” strong, with more and more entrants jumping on this bandwagon. 2. Dream “Paradise,” “masterpiece,” “dream” and “perfection” are other lofty 3. Paradise claims developers make, suggesting that modesty is not a virtue when it comes to real estate. In their efforts to top one another, more and 4. Live/Living more projects are parroting the same tired phrases. All this adds up to 5. Reinvented missed opportunity. Although it's a considerable challenge, in a sea of overstatements, nothing is as memorable as a new message. 17 18
  • 11. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY ARABICIZATION EmERGES ALDAR’S cOmPELLinG HOYAmAL cAmPAiGn SiGnALED A nEw ERA in REGiOnAL REAL ESTATE ADvERTiSinG. THE past year or two, there has been a definite increase in the use of SEARcH FOR AUTHEnTiciTY PROjEcT nAmES Over the AL FURjAn bAwAbAT AL SHARQ Arabic, exemplified by the powerful “Hoyamal” campaign by Aldar. This AL GHARbiA DiYAR AL mUHARRAQ includes the names of developments as well as in mandated contracts, signage and wayfinding. Where once English names seemed preferred AQEEQ AL mARinA LiwAn (The Meadows, The Lakes), now Burj Dubai and Madinat Jumeirah ARjAn mAjAn are standard and growing more common every day. This is especially ARZANAH MIZIN evident with developers linked to the government. ASmARAn nOOR AL Ain The use of Arabic is a greater indication of the region’s growing AL ZEINA nUR confidence in its own history and authenticity. No longer required to AL ZORAH OmRAn look abroad for information and inspiration, many are now looking bAb AL bAHR REmRAAm for unique brand voices from within. bADRAH RUwAYA 19 bURj AL FARA’A SALAm RESORT 20
  • 12. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY THE DiFFicULTiES OF POSiTiOninG A REAL ESTATE bRAnD With the explosion of development and the brands that have been created, most real estate postionings are already ULTimATE SOPHiSTicATED vALUE AFFORDAbLE in use in the Gulf marketplace, particularly those that center on luxury. For a new brand entering the playing field, in ELEGAncE LiFESTYLE what unique opportunities are left? THE bEST SELF- LivinG in THE PLAcE in THE cOnTAinED FAmiLY THE LURE OF ALL HAvEn HARmOnY TO bE cEnTER AnD FiRST OF wATER wORLDS SUSTAinAbLE ciTY nEw EXPAnD mODERn AnD wiTHin HEiGHTS OF GREEn cOnnEcTED YOUR FiRST-TimE ULTimATE ORiEnTED HOmEOwnERS in LUXURY TEcHnOLOGY A ciTY LUXURY TO EvERYTHinG HORIZONS FOcUSED FOR LivE ScEnic HEARTbEAT nEXT REDEFininG SPA DESERT THE SELEcT YOUR AnD OF THE ciTY GEnERATiOn LUXURY LivinG PARADiSE FEw vAcATiOn TRAnQUiL wATERFROnT A bRiGHT ADDRESS THE SOciAL micRO- EScAPE PROXimiTY LUXURY FUTURE OF cHOicE cEnTER SEGmEnTS 21 22
  • 13. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY US$400 biLLiOn on infrastructure over the next three years 53 China and the GCC, each with enormous cash reserves from trade surpluses, will be the two leading infrastructure investors of the future. 53 OTHER NOTABLE INITIATIVES: ABU DHABI KUWAIT • A US $248 million iconic bridge • Saudi Arabia has envisaged an • Mubadala and GE recently entered a Planning to spend upwards of US $15 billion by 2012 on Projections indicate the government will invest US $3 billion in connecting Abu Dhabi and Dubai is investment of US $8 billion to joint venture together. Over the next infrastructure projects including road networks, bridges, the construction industry over the next five years57 nearing completion. It will be the third modernize and equip its ports.62 18 months, the companies plan to public transport and a significant airport expansion54 bridge connecting the two cities and is invest US $40 billion in commercial DUBAI designed to symbolize sand dunes.60 • Sharjah is constructing a US $45 and infrastructure projects in the QATAR Spending more than 33% of its budget on infrastructure, million, 32-km road network across region, GE’s fastest-growing market.64 Allocated US $8.4 billion for spending on infrastructure approximately US $12 billion58 • A 13.7 km, four-lane tunnel is being new residential neighborhoods. projects, notably the country's road network55 constructed in Abu Dhabi to help ease The plan includes a storm-water • Qatar has recently spent US $5.7 SAUDI ARABIA traffic congestion at a total cost of system, a sewage system and million on wastewater treatment AJMAN Major project underway upgrading 866 km of roadways leading US $1.25 billion.61 auxiliary roads.63 projects.65 Spending US $2.4 billion in infrastructure, including a to Makkah, Madinah, Riyadh, Al Qassim, Jouf, Jizan, Tabuk and coal-driven power plant56 Asir from all corners of the Kingdom59 23 24
  • 14. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY AIRPORTS: DEVELOPMENT ECONOMIC ENGINES OF Gulf countries are aggressively building and increasing the size, capacity and stature of AnD THE nEw PUbLic REALm their airports, often positioned as gateways to the region and beyond. Airports are US $23 US $11 US $9 US $2 US $1 UAE SAUDI QATAR KUWAIT BAHRAIN becoming more than transit centers; they are ARABIA valuable real estate, economic catalysts and biLLiOnS SPEnT destinations in and of themselves. DXb + jXb AUH bAH DOH Dubai International Dubai, uae Abu Dhabi International / abu Dhabi, uae Bahrain International / manama, bahrain New Doha International / Doha, Qatar Al Maktoum International Already award-winning and well established, Dubai International Currently undergoing a major US $6.8 billion expansion, the Bahrain announced plans for a major expansion of its With a US $9 billion budget, the New Doha International Airport is expanding to more than double its current passenger Abu Dhabi International Airport will add a new terminal and international airport that will have a price tag of nearly a billion Airport will replace the existing airport in 2010. The hub will capacity. In addition, the emirate is also spending US $10 billion runway, state-of-the-art air traffic control tower and expansive dollars. The plan will concentrate on expanding the terminal have a 4.2 km runway and a 4.8 km runway – one of the longest on Al Maktoum International, which will become the world’s cargo facility. The new Midfield Terminal Complex will include capacity to meet the country’s air transportation requirements in the world – designed to accommodate the A380. Built over largest airport with the capacity to serve up to 120 million additional immigration and handling facilities, and provide for the next two decades. The airport’s existing terminal has 22 sq km, half of which is reclaimed land, the airport will passengers per year. It will feature six parallel runways, 4.5 km in thousands of square meters of extra retail space, which will been handling more than seven million passengers a year feature some 40 contact gates, 22 remote gates, 62 parking length, each separated by a distance of 800 m. The airport will also exclusively offer premium brands unavailable in other duty at an average annual passenger growth rate of 9% positions, a 750,000 ton-per-year cargo facility, a cargo aircraft have three passenger terminals: one dedicated to airlines of the free outlets in the region. Collectively, the current development and an average annual cargo growth rate of 7%. maintenance center and various other maintenance centers. Emirates Group, the second to other carriers and the third efforts will double the existing airport land area and raise the to low-cost carriers. Sixteen cargo terminals with a combined airport’s annual passenger capacity to 20-40 million passengers 12-million-ton capacity will also be constructed. by 2010, with further expansion initiatives to follow thereafter. 25 26
  • 15. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY LUXURY URbAn cOnDOS GLObAL SAmPLE NAME NAME DUBAI PEARL K RESIDENCE MANDARIN ORIENTAL THE LANDMARK LIVING SHANGRI-LA LUMIÈRE RESIDENCES W NY DOWNTOWN DEVELOPER DEVELOPER Pearl Dubai FZ LLC / KL Landmark Sdn Bhd Palladian Development Chalegrove Properties Peterson Investment Group / Frasers Property Group The Moinian Group Al Fahim Group Westbank Projects Corp. LOCATION LOCATION Dubai, UAE Kuala Lumpur, Malaysia Chicago, USA London, England Vancouver, Canada Sydney, Australia New York, USA ARCHITECT ARCHITECT Schweger Association Architects dcmstudios Solomon Cordwell Buenz Squire and Partners James K.M. Cheng Architects Inc. Foster + Partners Gwathmey Siegel & Associates LIVING SHANGRI-LA YEAR COMPLETED YEAR COMPLETED 2010 2009 2009 West Tower: 2006 / East Tower: 2010 2008 2008 2009 FLOORS FLOORS 67 in each of four towers 50 74 West Tower: 31 / East Tower: 45 61 56 57 UNITS UNITS 2,000 180 150 662 227 456 223 BUILDING AMENITIES BUILDING AMENITIES DUBAI PEARL spa & gym, wellness clinic, private spa & fitness center, children’s pool spa & gym, 24-hour room service, landscaped piazza, restaurants & spa & fitness center, juice bar, glass atrium lobby w/glass- bottom spa & fitness center, roof terrace lobbies, viewing decks, water & playground, bar, café & lounge, full-service pet spa, five-star boutiques, high-speed elevator, specialty grocery store, exhibition pool above, Club Lumière Spa, w/cabanas, rooftop lounge & café, features on each floor, performing library & business center, restaurant, childcare services, underground secure car parking, space curated by Vancouver Art multi-purpose event room, landscaped plaza, luxury hotel on arts theater, jogging track, high-end mini-market, clubhouse, tailoring, personal shopping fitness center, environmentally friendly Gallery, library & game room, underground car park, movie lower floors, media screening room shopping mall, six luxury hotels, link barbecue area, screening room, biomass heating system, boutiques limousine service, media screening screening room to public transport butler service room, LEED Silver certification UNIT DETAILS UNIT DETAILS rainfall showerhead, oval-shaped jet city center & mountain views, 14-ft ceilings, full-length windows, floor-to-ceiling windows, balcony, Coal Harbour, English Bay & Stanley kitchens & bathrooms designed by customizable interiors, optional Graft baths, luxury countertops & floors, balcony, built-in wardrobes, interior Miele dishwasher, Sub-Zero built-in double wardrobes, Siemens Park views, kitchen appliances Foster, laundry room, full-height furniture, concealed flat-screen TV, designer cabinetry design & lifestyle options from refrigerator, Wolf cooktop, acoustical kitchen appliances, Villeroy & Boch by Boffi & Miele, Kallista cast-iron doors, tinted windows, color kitchen appliances by Miele and Asko, Christian Liagre, Yasumichi Morita, treatment between floors & bathroom fixtures, oversized showers, bathtub, bathroom fixtures by A/V intercom, home automation bathroom fixtures by Dornbract, Grohe, Minotti, Bulthaup, Gaggenau demising walls underfloor comfort heating Hansgrohe Axor & Philippe Starck systems Jeeves and Duravit and ULTI STARTING PRICE (USD) STARTING PRICE (USD) THE LANDMARK $2,573,000 $1,792,200 $3,357,000 $1,476,000 $2,573,000 $993,000 $1,476,000 PRICE PER SQ FT (USD) PRICE PER SQ FT (USD) $900 $586 $1,536 $1,638 $900 $972 $1,638 KEY MESSAGING KEY MESSAGING “24-hour living city” “Style has a new address” “Prepare to be delighted” “Own property in the heart of the “The best of cosmopolitan West “There can be no other choice: “Own it” world’s fastest-growing financial Coast living” welcome to Lumière Residences” district” 27 28
  • 16. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY LUXURY GOLF viLLAS GLObAL SAmPLE NAME NAME JUMEIRAH GOLF ESTATES PUNTA MITA TRUMP INTERNATIONAL GOLF TUCKER’S POINT CLUB TEMENOS ANGUILLA THE TIGER WOODS MISSION HILLS GOLF CLUB CLUB & RESIDENCES DEVELOPER DEVELOPER Leisurecorp Cantiles de Mita, S.A. de C.V. The Trump Organization / Castle Harbour Ltd. Flag Luxury Properties Tatweer Mission Hills Group Empresas Diaz Inc. LOCATION LOCATION Dubai, UAE Punta Mita, Mexico North Coast, Puerto Rico Tucker’s Town, Bermuda British West Indies, Anguilla Dubai, UAE Guanlan, China COURSE DESIGNER COURSE DESIGNER Greg Norman, Vijay Singh, Jack Nicklaus Tom Kite Roger Rulewich Greg Norman Tiger Woods *Please see below JUMEIRAH GOLF ESTATES Pete Dye, Sergio Garcia COURSES COURSES 4 2 2 1 1 1 12 YEAR COMPLETED YEAR COMPLETED Phase A: 2009 Phases I–IV: 2006 Phase I: 2008 2008 2008 2009 2005 Phase V: 2008 Full Completion: 2010 THE TIGER WOODS VILLAS VILLAS 900+ 60+ 500 14 37 100 1200+ BEDROOMS BEDROOMS 2–6 4 2–3 2–4 3 custom up to 12 COMMUNITY AMENITIES COMMUNITY AMENITIES tennis facilities, 9.5 miles of beach, clubhouse, restaurant & lounge, 1,000 tennis center, clubhouse, spa & golf academy, clubhouse, atrium, spa, kids' club, gym, hotels, TUCKER’S POINT CLUB golf & tennis academies, clubhouses, golf & tennis club, sailing & catamaran jogging & cycling tracks, fitness & spa spa & fitness center, laundry & dry acres of oceanfront, Trump Tranquility Spa, fitness center, beach & sailing club, tours, hiking & bike trails, horseback luxury boutique hotel, spa & fitness dining options, banquet hall, clubhouse, center, parks & lakes, GPS tracking cleaning, pet care, multiple dining 10-acre beach club w/spa & fitness center, water sport center, pre-arrival grocery riding, water sports center, 4,400 ft of center, gourmet dining (including six driving ranges, tennis, country club systems, restaurants, retail galleries, options, pre-arrival grocery shopping nursery & kids club, tennis facilities, shopping, luxury hotel & resort, beach, fitness center, St. Regis Resort, Gus Savoy signature restaurant), post offices, organic market, hotels, Trump Founder Club (includes use of restaurants Remòde spa, David Bouley restaurant, retail boutiques, beauty salon metro access a private jet, helicopter & limousine) kids & junior club, car rental VILLA DETAILS VILLA DETAILS furnishings by Poggenpohl, B&B Italia, courtyard entry w/water fountain, hurricane-resistant windows & doors, 500 sq ft veranda, private pool, Mediterranean architecture, white landscaped gardens, pools, private gardens, pool, arches, Miele and Bang & Olufsen, courtyard heated infinity plunge pool w/ Venetian electronic concierge, Sub-Zero oversized showers & whirlpool tubs, stucco exteriors, landscaped garden, smart home technology, in-home columns, balconies, home theater, & pool, landscaped gardens, double tile, terraces w/ocean views, exposed appliances, wine cooler, 10-ft oversized garages to courtyard ringed w/palms, infinity pool, security linked directly to community private elevator garage, maid’s room, fireplaces, hardwood beams, floor-to-ceiling ceilings & floor-to-ceiling windows accommodate golf carts Jacuzzi, floor-to-ceiling windows security center and local police, walk-in wardrobes windows, full wet bar, Viking fire & medical services appliances TRUMP INTERNATIONAL GOLF STARTING PRICE* (USD) STARTING PRICE* (USD) CLUB & RESIDENCES $2,700,000 $3,600,000 $1,550,000 $2,500,000 $1,400,000 $17,700,000 $917,000 PRICE PER SQ FT* (USD) PRICE PER SQ FT* (USD) *Jack nicklaus, greg norman, $450 $498 $528 $1,351 $467 $1,473 $258 (original) annika sorenstam, ernie els, KEY MESSAGING KEY MESSAGING vijay singh, nick faldo, Jose “Come home to a legend” “Live the dream” “Discover the luxury of Trump and the “The Bermuda of your “An oasis of tranquility and the “A golfing community that “216 holes, world’s #1” maria olazabal, David Duval, beauty of the ‘enchanted island’” dreams awaits you” promise of exclusive luxury” perfectly embodies the style and Jumbo ozaki, David Leadbetter, status of our namesake” Pete Dye, Zhang Lianwei *Pricing comprises off-plan and resale figures 29 30
  • 17. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY wATERFROnT cOnDOS GLObAL SAmPLE NAME NAME LE PROVENÇAL CANCúN TOWERS TRUMP OCEAN CLUB ONE SINGER ISLAND REFLECTIONS AT KEPPEL BAY DUBAI PROMENADE THE LIGHT POINT DEVELOPER DEVELOPER Cyril Dennis Acrosur Developers Trump Organization / WCI Communities Keppel Land Nakheel Jelutong Development Sdn Bhd K-Group Developers LOCATION LOCATION Cap d’Antibes, France Cancún, Mexico Panama City, Panama Singer Island, USA Sentosa, Singapore Dubai, UAE Penang, Malaysia ARCHITECT ARCHITECT ONE SINGER ISLAND Frank Jay Gould (original) De Regil Arquitectos Arias Serna Saravia Robert M. Swedroe Daniel Libeskind Atkins Architect Permata YEAR COMPLETED YEAR COMPLETED 2008 Second Tower: 2009 2010 2006 2012 2011 2012 FLOORS FLOORS 10 18–20 70 10 24 44–54 28 UNITS UNITS 56 50 1,004 15 82 1,973 88 BUILDING AMENITIES BUILDING AMENITIES 24-hour concierge, porter & parking 330-vessel marina, Tom Weiskopf- wellness spa & pool deck, Island private beach, billiards room, club sky gardens, nine sky bridges health club, pools, children’s play green features such as recycled valet, spa & wellness clinic, private designed golf course, gym & spa, Beach Club, yacht club, casino, room & patio, concierge, fitness linking six towers, reflecting pools, area, sky garden, communal prayer materials, green roof, rainwater beach & beachclub, golf club & tennis courts, infinity pools, event boutiques, restaurants, 24-hour center, pool, private theater, wine clubhouse, tennis courts, gym, rooms, mall, pier w/cafés & shops, harvesting, waste management, academy, tennis club/academy, ski rooms, hotel, commercial area Quintessentially concierge services, room, services from The Resort at pools, children’s play areas, 10-year storage rooms, supermarket, solar & wind energy and marine life TRUMP OCEAN CLUB club w/resident lift passes, yacht 24-hour valet service, limousine Singer Island membership to Marina at Keppel advanced security systems, private programs, commercial district & helicopter services, wine cellar, service, 24-hour medical service, Bay featuring member clubhouse, 70-berth marina, neighboring Icon w/dining & retail, hotel, conference advanced security systems business center dining and charter services to and Boutique hotels nearby facilities, cultural hall, waterfront neighboring islands amphitheater, sports park, double-gated security system UNIT DETAILS UNIT DETAILS Porsche kitchens, Louis Vuitton Jacuzzi, direct elevator service, European cabinetry, panoramic Sub-Zero, Wolf and Miele kitchen built-in wardrobes, full-height shading louvers, luxury appliances, home automation of lights and furniture, Turkish baths, Glass roof gardens, MABE appliances, ocean views, 9.5-ft ceilings, stainless appliances, wine cooler, Jacuzzi and French windows, private elevator wardrobes w/built-in lighting, security with remote access, keyless fireplaces, shower email high-end IT infrastructure, water steel appliances, Toto bathroom fixtures, built-in closet lobbies, Miele, Hansgrohe Axor, fully integrated semi-open kitchens entry, high-end IT infrastructure, capabilities, temperature-colored purifying system frameless showers system, medical alert systems in Duravit, Starck and Kaldewei luxury appliances tap water, indoor & outdoor master baths bathroom fixtures penthouse pools REFLECTIONS AT KEPPEL BAY STARTING PRICE* (USD) STARTING PRICE* (USD) $2,962,000 $345,000 $534,000 $2,300,000 $1,131,000 $1,198,000 $331,000 PRICE PER SQ FT* (USD) PRICE PER SQ FT* (USD) $2,613 –9,625 $190–355 $524–550 $791–840 $1,105–1,603 $921 $174 KEY MESSAGING KEY MESSAGING “One of the most beautiful hotels on “Where emotions come together” “Paradise from a new point of view” “Singer Island's most exclusive “Waterfront living at its finest” “Centre Yourself” “An iconic landmark to distinguish DUBAI PROMENADE the French Riviera, returned to its address” Penang as a world-class destination” former glory” *Pricing comprises off-plan and resale figures 31 32
  • 18. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY PROPRiETARY QUAnTiTATivE DEvELOPER PREFEREncE Emaar, again, stands alone as the most highly esteemed and most preferred developer brand, with Damac and Nakheel RESEARcH STUDY following distantly in a virtual tie for the second position. To better understand homebuyer attitudes and perceptions, Futurebrand worked with EXcELLEnT OvERALL RATinG (TOP bOX)** an independent market research firm to conduct a quantitative study of 250 recent and prospective home purchasers in Saudi Arabia, Qatar and the UAE (see page 46 for EmAAR 70% details on the methodology). This research provides insights into what buyers want, what DAmAc 26% motivates them and what factors drive their purchase decisions. Specifically covered are nAkHEEL 25% familiarity with and perceptions of leading developers; preference and consideration of various home types, amenities and locations; and the drivers of developer preference. ALDAR 13% THE TOP DEvELOPERS in SAUDi ARAbiA, QATAR AnD THE UAE DUbAi PROPERTiES 11% bARwA 3% Emaar remains the dominant developer in the region this year. what may be more surprising is how Damac has risen as a brand to stand shoulder-to-shoulder with nakheel, legendary creator of The Palm and The world. DAR AL ARkAn 4% UniTED DEvELOPmEnT 7% cOmPAnY (UDc) DEvELOPER REcOGniTiOn QATARi DiAR 3% Emaar remains the most recognized developer brand, with Damac and Nakheel tied for the second position, both significantly behind Emaar but far more recognized than all other developers. TOP 2 bOX* FAmiLiARiTY AcROSS THE UAE, SAUDi ARAbiA AnD QATAR mOST wAnT TO bUY A HOmE FROm (TOP bOX)*** EmAAR 77% EmAAR 55% DAmAc 32% DAmAc 19% nAkHEEL 32% nAkHEEL 18% ALDAR 14% ALDAR 13% DUbAi PROPERTiES 13% DUbAi PROPERTiES 7% bARwA 10% bARwA 3% DAR AL ARkAn 9% DAR AL ARkAn 5% UniTED DEvELOPmEnT UniTED DEvELOPmEnT 8% 7% cOmPAnY (UDc) cOmPAnY (UDc) QATARi DiAR 5% QATARi DiAR 2% ** Top Box is the percentage who rated the developer Excellent. * Top 2 Box identifies the percentage of respondents who rated the developer as the one they are most or second-most familiar with. *** Top Box is the percentage of respondents who agree completely with the statement, “This is the developer I would most want to buy a home from.” 33 34
  • 19. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY DEvELOPER imAGE innOvATivE cOmmUnicATES PROGRESS “Room to improve” and “parity at the top” are the two key takeaways from the brand image analysis. Across 4.4 EmAAR 4.5 nAkHEEL the 14 most important image attributes (based on the degree to which each attribute influences perceptions), DAmAc 4.5 EmAAR 4.3 the top five performing brands average a b grade. Perceived performance is uniformly good rather than great, even though these are the leading developer brands in the region. There is also a high degree of parity: Emaar UDc 4.4 DAmAc 4.3 DUbAi remains the clear leader (ranked #1 on 12 of the 14 attributes), but its advantage over Nakheel and Damac is nAkHEEL 4.4 PROPERTiES 4.2 much smaller than it was for familiarity and preference. Dubai Properties and some of the second-tier developers DUbAi 4.3 QATARi DiAR 4.2 PROPERTiES show strengths in select areas as well. AVERAGE GRADE: b+ AVERAGE GRADE: b HiGH-QUALiTY cOnSTRUcTiOn LUXURiOUS HOmES REASOnAbLY PRicED EXPERiEncED EmAAR 4.6 EmAAR 4.5 bARwA 4.3 EmAAR 4.5 DAmAc 4.4 nAkHEEL 4.5 EmAAR 3.9 DAmAc 4.4 nAkHEEL 4.4 DUbAi 4.4 ALDAR 3.8 nAkHEEL 4.4 PROPERTiES ALDAR DUbAi 4.4 4.3 DAmAc 4.3 nAkHEEL 3.8 PROPERTiES DUbAi 3.8 PROPERTiES 4.3 ALDAR 4.1 DAmAc ALDAR 4.1 AVERAGE GRADE: b+ AVERAGE GRADE: b AVERAGE GRADE: c+ AVERAGE GRADE: b TRUSTwORTHY RESPOnSivE cUSTOmER SERvicE DELivERS On TimE EASY TO wORk wiTH EmAAR 4.6 EmAAR 4.6 EmAAR 4.4 EmAAR 4.5 DUbAi 4.3 4.3 PROPERTiES 4.5 DAmAc 4.4 ALDAR DAmAc 4.4 DUbAi nAkHEEL 4.4 UDc DAR AL ARkAn 4.3 PROPERTiES 4.2 DAmAc 4.4 nAkHEEL 4.4 DAmAc 4.3 ALDAR 4.1 ALDAR 4.2 DUbAi 4.3 nAkHEEL 4.3 4.1 PROPERTiES nAkHEEL AVERAGE GRADE: b+ AVERAGE GRADE: b+ AVERAGE GRADE: b AVERAGE GRADE: b GOOD vALUE FOR THE mOnEY DESiRAbLE LOcATiOnS EnviROnmEnTALLY ORiEnTED bUiLDS GREAT PLAcES TO LivE EmAAR 4.4 EmAAR 4.4 EmAAR 4.2 EmAAR 4.5 nAkHEEL 4.4 nAkHEEL 4.4 DAmAc 4.0 nAkHEEL 4.4 ALDAR 4.2 DAmAc 4.3 nAkHEEL 4.0 DAmAc 4.3 DAmAc 4.2 DUbAi 4.3 ALDAR 4.0 DUbAi 4.2 PROPERTiES PROPERTiES DUbAi 4.1 DUbAi 3.9 PROPERTiES 4.1 ALDAR PROPERTiES ALDAR 4.2 AVERAGE GRADE: b AVERAGE GRADE: b AVERAGE GRADE: b- AVERAGE GRADE: b Average rating on a 5-point scale, from 1 (Unacceptable) to 5 (Superior). Average rating on a 5-point scale, from 1 (Unacceptable) to 5 (Superior). 35 36
  • 20. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY HOmE TYPE APPEAL When respondents in Saudi Arabia, Qatar and the UAE rate various types of homes based on their appeal*, proximity to water is the clear winner, a choice that is more preferred than homes in city centers or on golf courses. wATERFROnT TRUmPS EvERYTHinG villas on island beach resorts and mainland apartments overlooking water are the two most appealing options among all the home styles surveyed. The average appeal levels for villas and apartments, at 78% and 74% respectively, are at statistical parity – indicating roughly equivalent levels of preference overall. viLLAS APARTmEnTS mAinLAnD APARTmEnT viLLA On OvERLOOkinG iSLAnD wATER viLLA in bEAcH RESORT EcOLOGicAL APPEAL LEVEL: APPEAL LEVEL: PARk APPEAL LEVEL: 82% HiGH-RiSE 84% APARTmEnT in viLLA in GOLF 79% ciTY cEnTER cOmmUniTY APPEAL LEVEL: APPEAL LEVEL: 75% 72% APARTmEnT in GOLF cOmmUniTY APPEAL LEVEL: 64% * Home types were rated independently of each other based on the degree to which respondents find them appealing. * Home types were rated independently of each other based on the degree to which respondents find them appealing. 37 38
  • 21. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY HOmE FEATURE DRivERS ARcHiTEcTURAL DESiGn European and Modern Architecture perform best on the Decision Index, but do it differently. European is the most FLOORinG Marble is the dominant choice in the flooring category, more than double the preference and Decision Index of preferred and most polarizing; Modern is somewhat less the next leading choice, Ceramic Tile. The home features with the broadest market appeal are famed architects, modern and preferred but also less disliked. European architecture, marble floors, security systems, private yards and pools DEciSiOn inDEX DEciSiOn inDEX 153 To determine what buyers really want and the true degree to which various amenities can be leveraged, Futurebrand created the DEciSiOn inDEX. Based on a detailed formula that takes into account both the strength of preference and the extent of dislike for a specific amenity, the Decision Index reflects the degree of polarization for each amenity – and quantifies 113 106 the overall ability of a specific amenity to drive consumer decisions. A high Decision Index is a measure of the net market preference for an amenity, indicating that the percentage of people who love the amenity far exceeds the percentage who 70 don’t like it. by combining the most preferred and least preferred percentages into one composite measure, the Decision Index can be used as a planning tool to gauge how much home features and amenities can be leveraged. The charts on 42 39 this page depict the Decision Indexes of various features and amenities in five categories. THE FORMULA: -21 -22 Homebuyers rank ordered the amenities in each category from most preferred to least preferred. The percentages that each amenity was rated most preferred and least preferred were then inserted into the formula detailed below. mODERn EUROPEAn ARAbiAn ASiAn HARDwOOD cARPET mARbLE cERAmic TiLE THE FORmULA DESiGnER FEATURES TEcHnOLOGY OUTDOOR AmEniTiES The Decision Index shows Famous Architect to be the In the technology category, Security System stands out In terms of absolute preference, no single amenity stands dominant choice in the category – it is the most preferred, as the dominant amenity in terms of both absolute out; however, the Decision Index shows Swimming Pool DI = aMPI – aLPI and it is the safest choice for a developer. preference and the Decision Index. and Private Yard to be the most compelling choices for a developer. Each can be leveraged more than twice as much as the next leading options. DEciSiOn inDEX DEciSiOn inDEX DEciSiOn inDEX 164 155 aMPI = MPI x 80% aLPI = LPI x 20% 158 129 %MP %LP MPI = LPI = Norm Norm 59 59 53 58 28 KEY: 38 Di = DEciSiOn inDEX 18 0 28 17 mP = mOST PREFERRED LP = LEAST PREFERRED -63 mPi = mOST PREFERRED inDEX HiGH-EnD DESiGnER DESiGnER FAmOUS HiGH-SPEED SEcURiTY AUTOmATED cAbLE OR SwimminG mARinA PRivATE TERRAcE mULTiPLE mAin PUbLic LPi = LEAST PREFERRED inDEX APPLiAncES kiTcHEn bATHROOm ARcHiTEcT inTERnET SYSTEm vALET SATELLiTE POOL AccESS YARD cAR ROAD TRAnSPORT PARkinG AccESS AccESS a = ADjUSTmEnT FAcTOR (bASED On THE 80/20 RULE) AccESS Tv READY 39 40
  • 22. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY ADDiTiOnAL inSiGHTS DRivERS AnD LOcATiOnS • Four of the top five most important drivers of developer preference – high-quality construction, trustworthy, responsive customer service and good value for the money – focus on reliability and emotional comfort. This suggests that developers need to establish a strong bond with their customers which largely seems lacking today. where people in Saudi Arabia, Qatar and the UAE would choose to have a • Even with luxurious homes being the second most important attribute, the four attributes that focus on premium quality second or vacation home, and what drives their selection of a developer and physical comfort – luxurious homes, desirable locations, premium amenities and well-planned units – are less than half as important as the reliability attributes. This is suggestive of an undercurrent of distrust in the real estate marketplace and a need for reassurance. • The results of this undercurrent are evidenced in the performance of the Damac and nakheel brands over the past year. both brands suffered from publicized scandals yet were able to gain ground on Emaar in many brand image attributes. However, both failed to close the gap in the all-important “developer i most want to buy a home from” measure. PREFEREncE DRivERS This graph depicts the relative importance of key attributes in terms of their ability to predict a homebuyer’s • Nakheel is a brand that seems to be losing some traction. A year ago, these vision builders were well positioned as a predisposition toward a developer. See page 46 for methodology on Relative Importance. clear #2, behind only Emaar in the region. now, nakheel has been largely caught by Damac on several key rankings including recognition, preference and perceptions of having experience and providing high-quality construction. High-Quality construction 14.3% Luxurious Homes 13.2% • At the same time, Emaar shows no signs of letting up its dominance, with a 141% advantage in familiarity and a 189% advantage in preference compared to the next leading brand as well as the #1 rank in 12 of the 14 most important Trustworthy 10.6% brand image attributes. Responsive customer Service 10.4% • The two most efficient brands at converting familiarity into consideration, meaning moving from just being aware Good value for the money 10.2% of a brand to considering purchasing from them, are Aldar, at 93%, and United Development company, at 88%. Desirable Locations 8.1% From a broader regional perspective, both of these brands suffer from limited geographic presence. neither is well-known outside its home market; however, both have established strong brand images in Abu Dhabi and innovative 7.9% Qatar, respectively. communicates Progress 4.3% • Interestingly, almost one-third of all respondents in Saudi Arabia, Qatar and the UAE selected their home city as their first Reasonably Priced 4.0% or second choice for a second or vacation home. This may suggest that, beyond Dubai, many of these homebuyers do Experienced not see a compelling enough difference in other Gcc cities to merit their selection for a second home. 3.6% Delivers on Time 3.3% THE mOST DESiRED LOcATiOnS Easy to work with 2.9% Dubai stands alone as the most desired location for a second or vacation home, preferred more than three times as much as the next city. Environmentally Oriented 2.8% builds Great Places to Live 2.5% 50.4% well-Planned Units 0.7% Premium Amenities 0.5% 11.5% Provides Homes That Are a 9.9% Good investment 0.4% 9.4% 7.3 % 6.8 % 6.8 % 4.7% 3.1% 2.1% 2.1% Government Affiliated 0.2% Financially Sound DUbAi AbU DHAbi SHARjAH DOHA RiYADH RAk jEDDAH FUjAiRAH mUScAT mAnAmA kUwAiT 0.1% ciTY 41 42
  • 23. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY bEncHmARk YOUR bRAnD BENCHMARK SCORE: 0-25: WHAT YOUR SCORE MEANS FOR YOUR BRAND: brand is failing and needs to improve across the E= take a few minutes to assess your own brand performance across its key channels and marketing touchpoints. great board brands maximize each channel’s advantages but still appear synergized and holistic. 26-50: brand is performing poorly and needs improvement INSTRUCTIONS: 51-75: brand needs to address its flaws and upgrade areas step 1: Rank your brand from 1-10 in each category across the bottom half of the chart. Perform indicated calculations of weakness where applicable. step 2: calculate scores for the four main categories (People, Product, materials, environments). step 3: add scores in each category to determine your benchmark score. 76-100: brand is performing reasonably well, although it may need to revisit specific areas of weakness in order to SCORING: 0-2 = not in channel; poor performance 3-5 = Poor to average 6-8 = good to very good 9-10 = excellent execute formula in step 3 to calculate your benchmark score increase its efficacy A B C D =E STEP 3 x 0.2 = A x 0.6 = B x 0.6 = C x 0.3 = D STEP 2 PEOPLE PRODUcT mATERiALS EnviROnmEnTS add 5 scores below add 7 scores below add 3 scores below add 4 scores below Divide total by 5 Divide total by 4 add 4 scores below add 4 add 5 STEP 1 va co De tim fe scores scores ev sa tra offi inn Qu nstru ae sign sus atu en en les ova mo lue fo sth tai De ely live res below below t(s viro des ce (s) tio ne r alit cti eti na ) nm ho n y y on cs bil ry en w( ity t(s s) ) BROADCAST WEB / DIGITAL* + ADVERTISING COLLATERAL* co ma int cu sto ma rke op era sa les Le ad & P rpora int tar & m in s ou on Ra Pri fly br oc ne sta co erna me tin tio tea ers ran et ge ted icr ite tdo or lin ea dio nt ad giv ers & hu ws let tio ne mm l rs gD ns m hip rod te &t o ds /t va s ea res ter ry un sta uc Ric wa s ic erv ice ep art ff tea m tv oo ls h m site( ds ys ati on me ide ails s) s nt os 43 44 *Web/Digital and collateral are discounted to reflect the comparative importance of broadcast + advertising in influencing brand performance.
  • 24. FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY FUTUREbRAnD’S 2008 GULF REAL ESTATE STUDY A bRiEF RETROSPEcTivE kEY cOnTAcTS For more information about the Gulf Real Estate Study, purchasing customized research data, marketing seminars or branding services, please contact: RinA PLAPLER rplapler@futurebrand.com wiLLiAm SHinTAni wshintani@futurebrand.com After four years of compiling and creating the Gulf Real Estate Study, it is amazing to view + 1 212 931 6443 + 971 4 367 8285 the evolution and breadth of proliferation, and the scale of expansion and value in the category. Growing pains abound, but more and more, the “futurebrands” of the industry OvERALL mETHODOLOGY RELATivE imPORTAncE mETHODOLOGY This research is a quantitative survey of 250 respondents, a sample The relative importance of image attributes was determined using are being shaped in this region and chronicled in our studies. that yields a margin of error of ±6.3% at a 95% confidence level. The research findings should be taken as representative of the multivariate regression. Asking research respondents their opinions about what is important is simply not reliable or accurate, as what GCC, rather than a definitive reading of homebuyers across people say and what they do are typically not aligned. Multivariate the region. Face-to-face interviews were conducted in five GCC regression examines patterns in the data to identify how perceptions mATURATiOn (2005) HUGE (2005) markets – Jeddah, Riyadh, Doha, Abu Dhabi and Dubai – among and attitudes correlate with preferences. affluent adults, age 26+, who are recent or impending purchasers of a high-end home. SOURcES 24. “Durrat Al Bahrain Villas to be Delivered in November,” Durrat Al Bahrain 45. “Saudi's Lamar Towers,” Arabian Business, 26 July 2008 46. “Kuwait Retail Supply Lags Behind Consumer 1. CommuniGate Middle East, 4 August 2008 website, 4 May 2008 Demand,” AME Info, 21 July 2008 2. “GCC Fastest Growing Retail Real Estate 25. “Real Estate Demand Rising,” Gulf Times, 47. “City of Silk,” Arabian Business, 21 August 2008 Market in the World,” AME Info, 14 March 2007 8 July 2008 48. “World Learns from Abu Dhabi,” The National, 3. “UAE Fourth in World Land Sales List,” Arabian 26. “Qatar Issues Rent Cap,” AME Info, 4 March 2008 6 May 2008 Business, 13 August 2008 27. “Alaqaria to Invest QR10bn on Housing 49. “Top 10 Abu Dhabi Projects Worth Dh700b,” 4. “UAE Mortgage Lending Soars,” Projects in Qatar,” Online Qatar, 2008 Gulf News, 16 May 2008 Arabian Business, 9 July 2008 28. “Qatari Diar Lusail Development, 50. “Zaya Launched its First of Many Property Ventures inFATUATiOn (2006) MEGA (2006) 5. “UAE Lands in World Top Five,” On its Way Ahead,” Online Qatar, 2008 on Nurai Island,” Zawya, 12 May 2008 Emirates Business 24/7, 13 August 2008 29. “Qatar to Witness 93000 Residential 51. “Top 10 Abu Dhabi Projects are Worth USD 190 6. “Dubai to Stand Tall with 3,000 Units by 2010,” Online Qatar, 2008 Billion,” SteelGuru, 11 September 2008 Towers,” Gulf News, 7 August 2008 30. “Dubai Home Prices Climb 40%,” AME Info, 52. “New Urbanism,” Wikipedia 7. “Dubai Real Estate Overview,” Colliers 20 August 2008 53. “Merrill Lynch: Emerging Market Infrastructure International, Second Quarter 2008 31. “Arrival Figures Show Dubai is Booming Spending Will Surge 80% in the Next Three Years,” 8. “Abu Dhabi’s Real Estate Projects to Cross with Developers Looking to the Long Jutia Group, 9 July 2008 Dh1.71tr,” Dubai Inside, 16 May 2008 Term,” Property Wire, 23 August 2008 54. “Abu Dhabi to Spend Dh55 Billion on Infrastructure 9. “Space Crunch,” Gulf Business, April 2008 32. “Moving Downmarket,” The Gulf, Projects by 2012,” Gowealthy.com, 31 August 2008 10. “Abu Dhabi Real Estate Overview,” Colliers 14-20 June 2008 55. “Qatar Focuses on Infrastructure Projects in its International, Second Quarter 2008 33. “Dubai’s Eco-Friendly Master Plan Revealed,” Budget,” Gulf News, 20 April 2008 11. “Riyadh Real Estate Overview,” Colliers Arabian Business, 31 August 2008 56. “Ajman to Invest Dh8.8 billion in Infrastructure,” International, Fourth Quarter 2007 34. "Condé Nast Unfolds its Annual 'It List'," Arabian Khaleej Times, 29 July 2008 SATURATiOn (2007) EPic (2007) 12. “180 bn Needed to Meet Housing Business, 26 January 2008 57. “Kuwait Infrastructure Report 2008,” Business Demand,” Arabian Business, 11 June 2008" 35. “Throw of the Dice,” The Gulf, 19-25 July 2008 Monitor International 13. “Western Buyers Tepid on Hot Gulf Property,” 36. “Oman Rent Law to Safeguard Tenants,” Arabian 58. “For Stability and Strategy, Economic and Social,” Reuters, 29 August 2008 Business, 10 March 2008 Gulf News, 19 August 2008 14. “Qatar a Burgeoning Real Estate 37. “Global Investment House: Oman Economic and 59. “Saudi Keen to Develop Highways to Main Cities,” Sector,” Euromoney, August 2008 Strategic Outlook – Real Estate Sector,” Khaleej Times, 19 June 2008 15. “Omani Infrastructure Report 2008,” Entrepreneur, 8 May 2008 60. “Iconic Bridge Takes Shape,” Gulf News, Business Monitor International 38. “Oman’s Blue City Causing Investor Concerns,” 23 July 2008 16. “Oman Property Market Set for Rapid Growth,” Arabian Business, 14 August 2008 61. “Green Tunnel to Take Shape,” Gulf News," Arabian Business, 10 September 2008 39. “Sama Dubai Completes 85% of Advanced Earth 28 July 2008 17. “Worth the Kuwait,” Arabian Work of AED 6.5 Billion Salam Yiti – Oman 62. “Port Development Essential for Middle East,” Business, 7 August 2008 Project,” Arabian Business, 28 May 2008 Arabian Business, 7 April 2008 18. “No Visa Guarantees for Investors,” 40. “The Wave, Muscat Adopts Sustainable 63. “Dh165 Million Infrastructure Development Plan PROLiFERATiOn (2008) GARGAnTUAn (2008) Arabian Business, 26 August 2008 Development Practices,” Arabian Business, for Sharjah Unveiled,” Gulf News, 28 July 2008 10 September 2008 19. “Building Bahrain,” Arabian Business, 64. “GE, Abu Dhabi Firm in $8 Bln Joint Venture,” 18 September 2008 41. “Value of New Projects in KSA to Reach $410b,” Reuters, 22 July 2008 Khaleej Times, 14 August 2008 20. “Bahrain Projects Delayed in Bid to Ease Growth,” 65. “Metito Completes AED 21 Million Waste Water Arabian Business, 29 August 2008 42. “Mortgage Law Approved in Saudi,” AME Info, Treatment Projects in Qatar's ‘Gas Capital of the 3 July 2008 World’,” Arabian Business, 15 July 2008 21. “Diyar Al Muharraq’s $3.2 bn Bahrain Project,” The National, 25 June 2008 43. “Jeddah Gate On Schedule,” Arabian Business, 66. “$68b Mena Airport Expansion Under Way,” 16 August 2008 Zawya, 22 March 2008 22. “Bahrain City Centre Opens for Business,” AME Info, 10 September 2008 44. “Dar Al Arkan Real Estate Development Company Records a Profit of SAR 1.1 Billion for the First 23. “Work on Marina West Gathers Half of 2008,” Arabian Business, 4 August 2008 Speed,” AME Info, 3 September 2008 Disclaimer: All material presented herein is intended for informational purposes and has been compiled from sources deemed reliable including Developers, Proprietary Research, Published Data, Ministries of Planning and Secondary Sources. Though information is believed to be correct, material presented is subject to errors, omissions, changes or withdrawal without notice. 45 46