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Dubai, The Pearl Of The Persian Gulf

By Patricia Tan

As a real estate professional working to bring overseas investors, retirees and part time residents to Florida I find competition for those investment dollars coming from many other parts of the globe. The world today is indeed very small, as the saying goes.

In recent months, my attention was drawn to find out more about real estate in Dubai, as it came up in conversations with clients from Europe in particular. Some had already invested there, spent vacations there or were anticipating some property bargains becoming available in the future, as more over supply became evident. My business partner just returned from a fact finding trip to Dubai, and it is one of the key areas we plan to monitor in coming months.

Dubai is one of the seven emirates of the United Arab Emirates (UAE). It is located on the Arabian Peninsula, south of the Persian Gulf – an area which most people associate as being rich in oil. While Dubai has the largest population of the Emirates, and the second largest land mass, it does not enjoy the abundant natural petroleum resources that are the mainstay of the neighboring emirates. Historically, the UAE economy was dominated by pearl production, fishing, and agriculture. The region first began exporting oil in 1962 and petroleum has dominated their economy since the rise in oil prices in 1973.

While some of the Emirates can rely on their abundant oil and gas resources for up to 150 years into the future, according to some sources, Dubai realized that their economy would need to evolve in a different direction. It quickly reinforced its position as the trading hub for the UAE. Over 6,000 companies from120 countries now have manufacturing or distribution facilities at the Jebel Ali complex in Dubai, which encompasses a deep-water port and free trade zone. All goods for re-export or transshipment enjoy exemption from all taxes and duties.

Today, Dubai’s economic wealth is derived from revenues from tourism, real estate, and financial services. In recent years, Dubai has attracted world attention through many innovative construction projects and sporting events, and its leadership has successfully combined their objectives for development of tourism and real estate. The Dubai government began the promotion in 1997 but realized that growth in their real estate market would be limited as long as they allowed foreign ownership only on a leasehold basis. In 2002, Dubai’s crown prince General Sheikh Mohammed bin Rashid Al Maktoom issued a decree that allowed foreigners to buy and own freehold property in selected areas of the city, which became known as New Dubai. This decree was followed by the announcement of The Palms – manmade palm-shaped islands that would offer luxury residences of all kinds to overseas owners.

The rest, as they say, is history. Dubai underwent massive real estate development, attracting investment from all corners of the globe. Their high profile developments were magnets to celebrities, offering luxury residences, seen as trophy properties. Themed buildings and neighborhoods, such as Sports City, were successfully target marketed to investors around the globe and Dubai was seen as the place to be, be invested in, and be seen in. The large scale developments have also included some of the world’s tallest skyscrapers.

Things have changed somewhat in recent years. Big projects have been delayed for technical, construction or financial reasons, and the market has experienced a downturn which many attribute to the global economic crisis. However, Dubai’s real estate market continues to move ahead and many see opportunities to invest for profit in the current climate.

I started this article by saying that Dubai poses competition to the real estate market in Florida. Just as our economy had its roots in citrus and cattle and we made the move to tourism and real estate, so was Dubai’s economy built on pearls and fishing and shifted to tourism and real estate. Both real estate markets have suffered significant downturns, but are now starting to see signs of recovery.

PHOTOS
Top: Luxury condominiums with boat docks, part of The Palm development – palm tree shaped land reclaimed from the Persian Gulf.
 
Middle: This building is currently under construction in Abu Dhabi and is a prime example of the “high-tech” modern architecture so typical of the region.

Bottom: Burj Khalifa This skyscraper is the tallest man made structure ever built, at 2,717ft. Engineered by the Chicago firm of Skidmore, Owings, and Merrill it stands at the center of Downtown Dubai.

Patricia Tan was born in England, and moved to Sarasota in 1997. Her career afforded her the opportunity to live and work in many countries around the world, including Australia, Hong Kong, Singapore, Malaysia, Indonesia, Germany, France, Belgium, Netherlands and the United Kingdom. She spent five years as a Director of an American real estate franchise in England in 1990s. Patricia has served as Chairperson of Sarasota Association of REALTORS®’ International Council, and serves on Florida Association of REALTORS®’ International Operations Committee. She currently works as International Sales Director for Prudential Palms Realty. Patricia may be reached at 941-487-5107 or patriciatan@prudentialpalmsrealty.com.

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