Site visit: Topaz Residence 2, Dubai Silicon Oasis
Construction Week tours the site of Topaz Residence 2, part of GGICO’s Dubai Silicon Oasis scheme that offers spacious one-bedroom apartments with ‘smart furniture’
In some ways, space has become a luxury for those looking to rent or own an apartment in the Middle East’s biggest cities, and Dubai is no exception to this growing trend. While some developers opt to cut corners – and thus, costs – to meet end-user requirements, others are looking for ways to offer residents a less cramped living option with manageable premiums.
UAE-based property developer, Gulf General Investment Company (GGICO), belongs to the latter group, and is currently focussing on constructing spacious residential units featuring built-in appliances and amenities. For instance, GGICO’s Topaz Residences Towers, a project comprising high-rise residential buildings, features ‘smart furniture’ to allow for increased storage and improved utilisation of space within its apartments.
The Dubai Silicon Oasis (DSO) project spans a total built-up area of 64,839m2, and comprises 448 units within three buildings. One of the towers that is currently under construction as part of the project is Topaz Residence 2.
The project was launched in 2015, and has an anticipated completion date of September 2018. Apartments start from $193,000 (AED708,695) with monthly instalments starting from $475 (AED1,750) per month. Buyers have the option to pay 40% of the unit price during construction, and the remaining 60% over a three-year post-payment plan, in addition to a 1% booking fee.
Topaz Residence 2, a G+8+R building, includes 200 residential one-bedroom apartments, and up to 10% of the development is dedicated to landscaping. Commenting on its construction progress, Bshir Osman, head of engineering at GGICO, says the project is the company’s second in the Topaz series, which is likely to be expanded in the future.
“Unit sizes in Topaz Residence 2 range from 93m2 to 111m2, and they are very spacious flats,” Osman tells Construction Week. “A single bedroom in one of our homes is equal to two bedrooms, when compared to market standards.”
He adds: “The project is now more than 55% complete. We have commenced finishing works, and we are on track to meet our deadline.”
Spearheaded by contractor Reem Capital Contracting and designed by Incorporated Consultants (CONIN), GGICO’s development aims to attract small families or couples, and sole investors. In addition to single-bedroom homes with large balconies, the project features facilities such as swimming pools and health clubs.
“We have high demand for one-bedroom [units], which is why most of our projects in DSO are of that size,” Osman explains. “We have a lot of couples and small families in Dubai, so the demand for these units is high.
“[To meet this demand], some investors would cut the [unnecessary] areas, so that they can pay less to develop one-bedroom units, and use their saved finances to build more. However, if you go to end-users, they prefer to live in spacious units, and we are targeting that segment.”
According to Osman, the use of ‘smart furniture’ – furnishings that offer more than their traditional analogue function – is one of the most distinguishing features of the Topaz apartment units. With the exception of kitchen appliances, Topaz apartment units are unfurnished; however, a built-in, fold-away dining table and bed, which are stored within the living room’s entertainment centre, are available. The apartments also offer a fully retractable partition to allow the separation of the kitchen and dining area from the living room.
“To better utilise this space, we have introduced smart furniture, which allows us to transform the living and dining room into a second bedroom,” Osman explains. “We can close it at night and use the partition to add another level of privacy in order to create the sense of a [separate] room.”
In addition to Topaz Residence 2, the GGICO project includes the Topaz Residence 1 tower, which was completed recently, and the Topaz Residence 3 tower, which is 75% complete and is expected to be delivered in Q3 2018.
GGICO holds 34% of the total residential projects in DSO, with its portfolio including Axis Residences and Platinum Residences, in addition to the ongoing Topaz Residences scheme. The developer is currently building its projects in some of Dubai’s newer and more affordable communities, including Dubai Sports City, and its focus remains end-users in the mid-market segment.
Dubai’s current market conditions are testing for developers, particularly in light of reports of oversupply and low liquidity, which are likely to cause concern within the UAE’s investment community. According to Osman, GGICO is up to the challenge, however.
“On any construction site, you will face challenges. This may even start with initiating enough cash flow to run the project, which ultimately depends on sales,” he says. “DSO’s zoning authority has also set some very strict rules about development, which have to be taken into consideration during construction.”
Growing competition in the property development sector is driving an increase in supply, even as demand remains unchanged. This trend, combined with rising pressure from larger companies entering the market, is compelling some developers to cut prices, according to Osman.
“I believe that the property market is oversupplied for now, and this must be controlled. However, I don’t believe it is declining – what we are seeing is more of a correction. As we get closer to Expo 2020 Dubai, conditions will become more stable,” he says.
According to JLL’s Q3 2017 Dubai Real Estate Market Overview, the majority of completions during the third quarter of last year were apartments. The data also suggests that up to 80,000 units could be delivered before the end of 2019 as construction activity intensifies in the lead up to Expo 2020 Dubai, although actual deliveries are likely to be below this level.
Further to this, Osman says he has observed that sales prices for both villas and apartments in the emirate have remained largely stable during the last quarter, adding that he has noted an increase in the number of vacant apartments in locations such as Downtown Dubai and Dubai Marina.
Osman says he expects these conditions to continue throughout 2018. He states: “We will face similar challenges [this year], including oversupply, but I am also expecting increased regulation within the market.
“I expect to see more investors entering the market in the next couple of years, especially from 2018 onwards, as more people start buying properties to sell in 2020.”