Interview: Sultan bin Mejren
What is your response to the claim that the market has turned a corner?
SULTAN BIN MEJREN: All signs indicate that the market is on track for more disciplined growth in the coming years. This will be driven by strong economic fundamentals. To begin with, Dubai has witnessed a healthy increase in value transactions. Property and development project prices have gone through a period of stabilisation. The cause and effect here is the stabilisation in price, which has generated more interest in several areas. Adding to this effect are rental properties, which have seen a gradual spike in occupation. Finally, the market has experienced significantly more lending, which is an unmistakable indication of a rebound.
How do you plan to streamline services related to real estate transactions in the long term?
BIN MEJREN: In 2007 a strategic development was conceived, and with that, the Real Estate Regulatory Agency (RERA) was established. The purpose of this agency was to create a transparent, professional and efficient real estate market. The inception of RERA reflects the government’s desire to achieve performance integration and to urgently respond to the needs of investors, in order to meet the market’s requirements after the construction boom. When the government opened freehold in Dubai to foreign investors, the responsibilities of the Land Department doubled and adjustments were made to cope with foreign ownership. A proactive approach was taken to transform the challenges of the 2008 financial crisis into opportunities. From this, the Centre for Promotion and Management of Real Estate Investment (CPMREI) was born.
The centre focuses on promoting and attracting foreign direct investment by working with multiple stakeholders in the market and endorsing Dubai’s real estate market. The CPMREI successfully launched multiple promotional programmes including Tayseer, a project financing initiative, and Tanmyia and Taqdeer, which are innovative, sustainable real estate market initiatives.
The final leg to Dubai’s strategic development was the addition of an entity called the Dubai Real Estate Institute (DREI), which focused on education and awareness creation. With electronic applications like Al Tabou, Ejari, Oqood, Simsari, and an e-appointment system developed by the Land Department and Emirates Real Estate Solutions, DREI has trained over 19,000 professionals. The goal of the agencies is to create an attractive environment for real estate investment, boosting Dubai’s economy and improving its competitiveness.
To what extent has transparency increased within the real estate market?
BIN MEJREN: Real estate investment must comply with a number of legislations and laws that enhance Dubai’s global ranking in terms of the legislative structure.
Several programmes were developed to boost transparency. For example, the introduction of RERA was accountable for the quantum leap in the performance of real estate developers and the improved transparency in market performance. Following these guidelines will help attract foreign investment by boosting investor confidence and increasing the efficiency of real estate companies. The application of the governance charter will have multiple effects. It will clarify company activities, project progress, financial solvency, and quality and risk management. The charter will take effect in January 2013. The Land Department also issues market reports about real estate demand, supply and prices to inform investors about market realities and trends.
What measures have been introduced to the sector to restore investor confidence?
BIN MEJREN: We prepared real estate market reports. As well, we implemented a real estate investor map and the real estate investor protection law. This law is the first statute of its kind regionally and globally. The draft takes into account a number of laws and regulations that were issued between 2003 and 2008 to ensure the optimal application of the new law and legislations.
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