Stepping Up Real Estate

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The construction frenzy witnessed in Dubai and Sharjah has now also reached the Northern Emirate of Ajman. Located barely 30km away from Dubai, and featuring 16km of coastline, the city of Ajman is benefiting greatly from Dubai's development spill over, and several real estate development projects are under way or were recently announced.

As property prices in Dubai and Sharjah increase, long-time residents and newcomers alike are progressively being priced out of those two cities, and promoters are willing to bet that they are ready to move into more remote areas, such as Ajman, if the price is right. Ajman, which neighbours Sharjah and is connected to Dubai through the Emirates Highway, might indeed prove to be a winning compromise. Construction activity has ramped up quickly, and this construction rush is also explained by the fact that, contrary to other Northern Emirates, Ajman's legislation allows foreigners to invest in and own freehold property. As a consequence, average real estate prices in Ajman have more than doubled in the past four years, yet they remain dramatically lower than in Dubai or Sharjah.

Dubai-based ETA Star's Pearl Residence, the first large-scale freehold development ever to take place in Ajman, was released to the market at the end of 2006. But more are in the pipeline. On February 19 and 20, the municipality held the Ajman Urban Planning Conference. With an attendance of over 500 real estate and construction investors, urban planning specialists and architects, it focused on high-rise urbanism - a major trend in emirates as a whole, as well as the challenges this poses and how to tackle them. The conference was also a showcase for real estate projects from companies such as R Holdings, Tameer Holdings, Aqaar and Tanmiyat.

R Holdings' Emirates City, a project worth $4.1bn, comprising 72 residential and commercial towers, is currently under construction. It will sit next to Tameer's Al Ameera project, 50 "traditionally designed" buildings - a $327m project, which should complete by the end of 2007. Saudi firm Tanmiyat unveiled the Ajman Marina development, which focuses more on tourism and residential components and will spread over almost 5 hectares, near the current location of the Kempinski Hotel. The value of this investment is currently unknown.

Another impressive development stems from Ajman's semi-governmental real estate and property development company, Aqaar Properties. The recently unveiled Al-Zora project will stretch over 1000 hectares between the Kempinski Hotel and the Al Hamriya port. This integrated development, which will include residential and commercial offices, as well as entertainment centres, a marina, a golf course, hotels, schools and hospitals, has been valued at over $13.62bn. "We are trying to build a new Monaco," Aqaar CEO Rami Dabbas told the press. Lebanese company Solidere, a company best known for its large real estate developments in Beirut, is co-developing the project. The area will be connected directly to the Emirates Highway, offering direct access to Dubai, without having to go through Ajman or Sharjah. Presently, commuters from Sharjah to Dubai can face up to two hours of traffic, despite the two cities' close proximity.

With the recent establishment of Aqaar Properties at the end of 2006, the emirate of Ajman expects to keep the upper hand on the real estate boom it is undergoing. Together with the Ajman Development and Investment Authority (ADIA), which was created in April 2006 and oversees long-term economic and investment planning, and the Ajman Municipality and Planning Department, Aqaar properties will allow the emirate to keep a firm grip over Ajman's development.

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