Face to face: Raj Chinai, Sobha Group
Managing director of Sobha Group, Raj Chinai, is confident that the company’s strong portfolio and promising project pipeline will help the business to safely navigate the choppy waters of the Dubai real estate market
Luxury is at the core of Dubai-based developer, Sobha Group, according to its managing director, Raj Chinai. Established in 1976 by first-generation entrepreneur, PNC Menon, it was originally an interior decoration firm, operating under the name of Services and Trade Company in Muscat, Oman. Since then, however, the group has expanded throughout the GCC and abroad. Primarily focussed on residential and contractual projects, the developer has built a particularly strong presence in the UAE and India.
Chinai tells Construction Week: “It’s almost been 41 years of conducting business successfully, be it in the region or in India, which is one of our largest markets. Today, we are regarded as one of the leading real estate developers in India and we want to replicate the same success story here.”
In Dubai, the developer currently has two luxury projects in its kitty – Sobha Hartland and, in conjunction with Meydan, District One. Its flagship project, Sobha Hartland, is a $4bn development, spread across a 74ha area. It comprises freehold studios; one-, two-, and three-bedroom apartments; duplexes; townhouses; and four-, five-, and six-bedroom villas, surrounded by 22.2ha of greenery — constituting 30% of the entire community.
Chinai explains that the location of the project within the Mohammed bin Rashid Al Maktoum (MBR) City, and within 3km of Dubai’s iconic attractions, makes it one of the most sought-after plots in Dubai. Sobha Hartland also boasts an array of amenities, including international schools, nurseries, healthcare facilities, swimming pools, tennis courts, yoga centres, gyms, playgrounds, and parks.
He adds: “We have made great progress in 2016 for Sobha Hartland. Our Hartland International School is in its second academic year, where we have a capacity of just over 2,000 students. It was one of our big developments over the course of 2016.
“In addition to that, we now have our model homes ready for customers and investors who want to come and experience our products. I believe it’s one thing to talk about projects and quite another to be able to take a look at how it will shape up. We also take pride in being a fully integrated company, probably the only one in the world to possess such a model. Everything in the value chain of building a home is in our control, which in turn allows the customer to easily customise the product according to their needs.”
In April last year, the developer launched Sobha Hartland Greens within its flagship development, which includes eight floors of residential apartments varying from studios, to one-, two-, and three-bedrooms. The luxury apartments start at a price of $218,894 (AED804, 000), with payment plans on offer. Chinai says that the handover of the units will start from December 2017.
Another launch, Hartland Estates, comprises Vaastu-inspired villas, complete with a range of waterfront and park-side villas. The units will feature private pools and courtyards.
He continues: “We always take pride in ourselves to be at the top of the pyramid, when it comes to quality and delivery. This experience becomes a lot more private, when customers get to see or feel the product. This philosophy is a result of the vision of our chairman, PNC Menon, who believes that all customers should have access to high-quality products. And it is his passion that is the driving force behind the company.”
In a recent scheme launched by Sobha, the company is offering new land plots for purchase by investors and end-users within the Sobha Hartland community, located on the Dubai Water Canal and in MBR City. Twenty-three land plots within the freehold community are available for building waterfront villas.
Chinai explains that buyers can choose to invest in a plot, measuring nearly 14,399m2, that is reserved for 12-storey apartment buildings, and will consist of approximately 250 to 300 units. Developers will get a chance to build their own brand of residences within the community, and have the option of a prime investment opportunity to maximise their profits. For hoteliers and operators, a single plot of 8,059m2 is available to build a hotel or hotel apartments under its brand.
He adds: “We have seen a lot of interest coming from the usual suspects, mainly in the GCC – especially Dubai, followed by Saudi Arabia, Qatar, and Oman – and also, India and London. We have seen a lot of individuals from London, who are connected to Dubai in some way, express interest in our properties. The confidence level of delivering a superior product on time is what we have always been associated with. We have seen people from all across the world, who are looking to expand their business in Dubai, and are looking for a second home, partly because their business forces them to travel to Dubai often. I, often, have high-net-worth individuals (HNIs) coming and asking for a boutique community-living experience.”
Another Sobha project, District One, which is the third phase of MBR City, is currently being developed in conjunction with UAE-based business conglomerate, Meydan Group. Phase 3 of the super-luxury project will feature 217 units, comprising four- and five-bedroom freehold villas, built on attractive, large plots, with a range of floorplans, including basement options, and an extended payment option.
Meydan Sobha has already sold out all the villas in Phase 1 and Phase 2, and handover for Phase 1 began at the end of 2016. Phase 2 is due to be completed by the end of 2017. Meydan Sobha is pulling out all the stops to ensure that the 2018 handover date for Phase 3 of District One is met, Chinai adds.
“The handover of Phase 1 started in December 2016, and the delivery will continue over the next few months. Phase 3 was successfully launched during Cityscape Global 2016. We have a healthy number of mansions in Phase 2 that have been nearly sold out. We feel very positive about the traction that we are currently seeing in the real estate market.”
The developer has recently been in talks for a third project located in Dubai, which, according to Chinai, will fall under the category of affordable luxury. He says: “The upcoming development will be an integrated residential community, which we will announce in the coming months.”
In 2016, the real estate sector was not particularly kind to developers, and many faced difficult challenges. But Chinai maintains a positive outlook. He says: “If you look at it from an industry perspective, we believe that there is an upwards cycle and a downwards cycle. At Sobha, we embrace it in terms of how we manage our financial engineering and year planning.
“We entered the downwards cycle at the end of 2014; we have wrapped up 2016 now and can see the momentum moving towards the positive cycle. All of us in the industry have faced a challenging environment in the past year. However, I believe that you need to do your financial engineering properly so that you can ride out the storm. At Sobha, we have always maintained a cautious approach during the downwards cycle.”
Chinai adds that, due to the brand strength of Sobha, the developer has received a number of inbound opportunities from the international markets, even during the slump times. “But we needed to prioritise. We had to realise that, in the current situation, it would be foolish for us to cater to all opportunities. We had to cherry-pick those that we believed would result in more optimal returns. And that, in turn, allowed us to focus on our core strength.”
Chinai, who joined Sobha in 2014, is confident that the real estate sector will strengthen in 2017. He strongly believes that the market is now starting to come out of its negative cycle and is already showing signs of an upswing. “We expect the market to continue to improve. We are optimistic about 2017. The industry has already started to turn, and I don’t think that the cycle will deviate from that path. 2017 will see continued gradual momentum in the Dubai real estate market.”