DUBAI May 15 DAMAC Properties
expects around 11,000 to 12,000 residential properties to hit
the Dubai market in 2017, a steady increase compared to the
average over the last two years, the group's chief finance
Supply of such properties in 2017 would not be far off
demand, reflecting a move towards stability, Adil Taqi said.
"The real estate market in its entirety has turned a
corner," Taqi told Reuters on Monday.
The emirate's property market has remained in the doldrums
over the past couple of years as a decline in oil prices and
concern over oversupply has dragged on market sentiment.
A total of 14,600 residential units entered the Dubai
residential market in 2016, the highest since 2012, according to
Jones Lang LaSalle, while in 2015 supply was 7,800 units.
Dubai-based DAMAC, which began operations in 2002 and has
also partnered in a golf complex named after U.S. President
Donald Trump, has expanded into North Africa, Jordan, Lebanon,
Qatar and Saudi Arabia, according to its website.
Fitch Ratings said earlier this month that Dubai real estate
prices and rentals are likely to remain under pressure for the
rest of 2017, but performance is likely to be fragmented.
Prime assets will show some resilience, while lower-tier
properties outside the centre will have price and rental
declines, it said in a report last week.
Damac's Taqi said he believed prices would likely move
"sideways" in 2017.
"When prices move sideways with a sensible increase that
reflects industry inflation - that indicates to everyone
stability," he said.
DAMAC, Dubai's second-largest developer, reported a 16.2
percent fall in first-quarter net profit on Monday as sales
Emaar Properties, the emirate's largest developer, reported
a 15 percent rise in first-quarter net profit, broadly in line
with analysts' expectations.
Although DAMAC had no plans to raise further debt in 2017,
Taqi did not rule out debt-raising in 2018 ahead of a debt
maturity of about $450 million in 2019.
"I wouldn't bet against us raising some money maybe in 2018,
so rather than having the $450 million outstanding that we would
be paying we would be looking at a smaller amount,” he said.
The company raised a $500 million sukuk with a five-year
tenor last month.
DAMAC's debt level would stand at its target of between $1.2
billion and $1.3 billion at the end of 2017, he said.
(Editing by Alexander Smith)