Public-private collaborations are promoting Sharjah’s steady real estate growth
Affordable property options and proximity to Dubai have helped to make Sharjah a lucrative market over the years. Now, emergent segments and buyers are on a steady, if quiet, journey to transform the emirate, Neha Bhatia reports
Professionals that have a nuanced understanding of the UAE’s socio-economic dynamics will have by now noticed that Sharjah’s property market is growing. Real estate developments noted in the emirate in the past 12 months point to a steadily increasing appetite for varied property options in the northern emirate.
In recent years, Sharjah’s main selling points have been its proximity to Dubai and the comparatively lower price points within which its real estate market operates. However, new asset classes – as well as smarter, more future-oriented buyers – are emerging in the emirate, setting the tone for what the city might look like in a decade’s time.
Perhaps the most encouraging facet of Sharjah’s current investment climate is that this progress is being driven through collaborations between the public and private sectors.
For instance, in September 2017, HH Sheikh Dr Sultan bin Muhammad Al Qasimi, Supreme Council Member and Ruler of Sharjah, unveiled Aljada, a master-planned megaproject that will be developed by Arada, a partnership enterprise formed jointly by KBW Investments and Basma Group. The former was founded by HRH Prince Khaled bin Alwaleed bin Talal, a member of Saudi Arabia’s royal family. The latter is chaired by HE Sheikh Sultan bin Ahmed Al Qasimi, a member of Sharjah’s ruling family.
Occupying a total area of 2.2km2 (220ha), Aljada will boast a gross development value of $6.5bn (AED24bn) and a total population of approximately 70,000 people. The development’s master plan, which was designed by Woods Bagot in close collaboration with Sharjah Urban Planning Council, has been designed with ‘walkability’ and green spaces in mind.
Commenting on the real estate gaps that Aljada would fulfil, Arada’s chairman, Sheikh Sultan, said: “We want to offer residents and investors upscale living experiences that are currently unavailable in the market, and ensure a better life for everyone who visits, lives, or works in Aljada.
“We are confident that this development will raise interest in Sharjah even further, while strengthening its position as a secure and sought-after investment destination.”
Sharjah appears to be on track to become one of the UAE’s busier investment destinations. The emirate recorded a year-on-year 37.2% rise in the value of its real estate trade during the third quarter of 2017, which was valued at $2.2bn (AED8.2bn).
According to figures released by the Sharjah Real Estate Registration Department, the total traded areas spanned 300ha, with Sharjah’s Al Khan neighbourhood leading in terms of volume, with 162 transactions.
One trend that could lead to an uptick in Sharjah’s property transactions this year is the likelihood of price reductions. A report by Bayut.com, published this month, revealed that apartment rents in Al Khan dropped by 6-10% in 2017. Al Nahda was the most-searched neighbourhood for apartments by visitors to the website in 2017, with prices for two- and three-bedroom units recording respective declines of 18% and 11%.
In fact, residential development is only one of the components that make up Sharjah’s future. Initiatives focussed on promoting the emirate’s touristic values are also supporting real estate growth in the emirate. One of the many examples of this is the management agreement signed by Basma Group and Arada with Minor Hotels this past December, for the development of Sharjah’s first Anantara-branded hospitality resort.
What’s more, the emirate’s government has approved a budget of $6bn (AED22.1bn) for 2018, 6% higher than 2017 values. This hike is likely to positively impact investor confidence in the emirate, which also witnessed the launch of three megaprojects – worth $735m (AED2.7bn) – this week (see page 6).
Sharjah’s real estate sector is firmly on the path to long-term growth. Slowly but surely the emirate’s loyal investors are sure to gain positive returns from their faith in the market.