Interview: Sahl Dudin
What more needs to be done in terms of policy to enhance Aqaba’s tourism offering?
SAHL DUDIN: Aqaba needs to be more developed as a tourist destination as all the necessary components are there. The biggest challenge for both the government and private sector is to work together in establishing easier access by supporting direct flights to the area. Once we have direct flights to Aqaba from neighbouring countries and Europe, we will be creating the much-needed footfall as there are quite a few developments coming up.
The current natural growth of tourism in the area cannot support the rapid growth of developments that are about to happen, such as the increasing number of hotel rooms and residential units. So we need a push and it should come from establishing more direct flights to the area. There are initiatives supported by the Ministry of Tourism and Antiquities, the Jordan Tourism Board and the Aqaba Special Economic Zone Authority, where they support weekly flights from different European cities directly to Aqaba already, but it is not enough.
In terms of identifying trends within the sector, how is Aqaba’s real estate market different from Amman and other cities in the kingdom?
DUDIN: Aqaba’s real estate market is much more challenging than Amman’s. Aqaba is a city with a population of 190,000, compared to Amman with a population of almost 4m people. Therefore, the demand in Amman is higher than the demand in Aqaba. Creating demand in Aqaba has been a big challenge for the real estate sector. That is why it is necessary to also concentrate on tourism. Tourism is more established: there are more hotels, more facilities for entertainment and more attractions. All of these can become magnets to encourage people to invest in real estate. At the moment most of the investors in real estate in Aqaba are residents of Amman who are investing in a second home. That is a very small segment and you can not do that with the entire population. In the future we believe that demand for real estate will increase, not only for permanent residents or second residents, but by establishing Aqaba as a retirement destination for Europeans and Arabs.
How are lower oil prices and regional turmoil impacting residential demand, and what trends do you identify among foreign buyers?
DUDIN: The main hit in the real estate sector has been the regional turmoil, but there is still demand in Aqaba. A current trend is the demand for smaller sized units, as many people use them as second home units. However, one of the key challenges has been to get buyers to buy office units. You need to have something on the ground first.
Moreover, if we take into account all the different residential developments happening in Aqaba, you could say that the market is a bit over-saturated. It will be like this for a while, but will balance itself out eventually. In the end there will always be demand in Aqaba because it is on our only seashore. In the future it will pick up because there will be additional communities living there and more commercial business happening in the area.
Given how resource-poor Jordan is, what are the main considerations for developers when planning projects in regards to utilities?
DUDIN: In order to have a sustainable real estate project you have to take extra steps regarding utilities. It is advisable to invest in renewable energies to power the operations and activities of mega-projects. Luckily, Jordan has good renewable energy regulations and initiatives. It is better to rely on renewable energy not only because there is no energy available, but because it is also cheaper.
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