34 Gulf Property

Gone are the dayswhen Sharjah wasjust a cheaper livingalternative to peopleworking in Dubai.

Today the emirate, which isconsidered to be the culturalhub of the UAE, is growingeconomically, thanks to di-versification. Moreover, therelaxation of Sharjah’s rigidproperty ownership regula-tions by its government re-cently has in some sortsopened the sluice gates forreal estate developers tothrong to the emirate withtheir ambitious projects.

Previously, only GCC na-tionals had the right to own aproperty in Sharjah. This lawwas radically amended bythe Government of Sharjahlate in 2014, allowing all non-

GCC nationalities with aUAE residency visa, to ownproperties on a leaseholdbasis. Although the newownership laws may still beviewed as conservativewhen compared to those ofDubai, and still have somereservations on foreigners in-vesting in Sharjah, bothproperty developers and res-idents have welcomed theliberalisation, as it satiatestheir needs well.

As a result, in response tothe growing demand in themarket and in a first for Shar-jah, the newly formed TilalProperties, a joint venturebetween Sharjah Asset Man-agement (the investmentarm of the Government ofSharjah) and Eskan Real Es-tate Development, launchedTilal City in December 2014.The new master plannedproject began offering about2,000 residential and com-mercial land plots to non-

GCC nationals for the firsttime on a leasehold basis fora period of 100 years.

Many more developershave followed suit andlaunched their ambitiousprojects in the emirate since.While Sharjah-based JMSProperty Development andManagement re-launchedtheir mix-used project ‘AlRayyan’ in Al Nahda districtin February, newly-formedSharjah Holding in Marchlaunched its first project ‘AlZahia’, a gated communityproject.

“This is an exciting time forSharjah with a number ofhigh-profile projects beinglaunched in Sharjah, demon-strating the emirate’s ambi-tions,” Steve Morgan, CEOof Cluttons Middle East com-mented. “First if you look atthe (Sharjah) residentialrental market you will seethat the average rental val-ues have grown by 53 per

cent since 2012, which isgood going in any market.We believe that this signifi-cant rise in rentals indicatesto a high underlying demandand highlights the depth inthe market.”

The ‘Sharjah Winter 2014Residential Market Outlook’by Cluttons, available to GulfProperty, offers a sneakpeak into how the residentialproperty market in the emi-rate had performed till thethird quarter of 2014.

Rents continueto surgeAt the end of Q3 2014, rentsacross Sharjah stood 26.4per cent higher than thesame time last year, with Q3registering growth of 5.3 percent. The latest increase fol-lows the 5.7 per cent riserecorded during the secondquarter and translates into a

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Sharjah realty: Growingby leaps and boundsSharjah realty: Growingby leaps and bounds

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has put pressure on the lim-ited supply of villas, particu-larly at the higher end of themarket. Furthermore, withthe strong growth in Dubai’shospitality and food & bever-age sectors, several busi-nesses have singled outSharjah as an affordable al-ternative to Dubai for bulkstaff housing. This will in-evitably catalyse increasedcompetition for the city’s re-stricted apartment stock, par-ticularly in the near term’, thereport predicts.

Villas becomepricierDuring the first three quartersof 2014, villa rents increasedby 29 per cent, with the rateof rent acceleration slowingto just under 7 per cent inQ3, from 8.2 per cent in Q2.‘This is not a reflection ofweakness in the level of re-

quirements, but insteadpoints to a breaching of af-fordability. Clearly averagehousehold incomes havefailed to match the speed ofgrowth in rents. Overall, thebehaviour of the lettings mar-ket in Sharjah mirrors whathas already occurred in thelettings markets in both AbuDhabi and Dubai and we ex-pect this to persist as afford-ability issues start to limit thestrong rental value growthwe have recorded over thepast 18 months’, as per theforecast by Cluttons.

‘The overall level of villaenquiries continues to out-strip supply and we are stillseeing developers rush tomobilise on sites, reflectingthe depth of confidence inthe market. The planned villasupply should take 18 to 24months to be delivered to themarket, although it may bedelayed by issues surround-ing SEWA (Sharjah Electric-

ity and Water Authority) utilityconnections’, the reportmaintains.

So is the growth of theSharjah market solely de-pendent on resident reloca-tions from Dubai or AbuDhabi? “I think this is clearlya factor for towns and citieswhich are located near big-ger towns and cities. Theywill naturally benefit from thegrowth of the bigger city,”Morgan believes. “But Shar-jah has its own internationalappeal as well.”

The UAE economy has ex-perienced a strong period ofgrowth since 2012, with GDPrising at a year-on-year rateof 4 per cent. Announce-ments such as Dubai’s Expo2020 have boosted sectorsincluding tourism and hospi-tality. This robust and sus-tainable growth has had acrucial impact on real estatesector growth not just inDubai and Abu Dhabi, butalso in Sharjah. g

23 per cent surge during thefirst nine months of 2014, ac-cording to the report. Apart-ments retained their leadover villas, with rents risingby 35 per cent in the 12months to the end of Q3.

‘The strength of tenant de-mand has persisted through-out the year against abackdrop of static residentialsupply. Furthermore, withtenants wary of the lack of al-ternative options in the mar-ket, many households arechoosing to remain in situ atrenewal, capitalising on thesecurity offered by the threeyear Sharjah Municipality“rent-cap”,’ according to thereport by Cluttons, which isalso the exclusive salesagency for both the Tilal Cityand Al Rayyan projects.

‘While reverse migrationfrom Dubai has no doubt fu-elled overall tenant demand,requirements from Sharjah’srapidly expanding Air Arabia

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An artist’s impressionof Tilal City, Sharjah

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36 Gulf Property

Sharjah-based prop-erty developer, JMSProperty Develop-ment and Manage-ment has recently

announced the re-launch ofAl Rayyan, a mixed-use proj-ect in Sharjah. The Dh700million development, which

spans across 2.7 millionsquare feet, will feature resi-dential, commercial and re-tail units.

Al Rayyan is one the firstprojects in Sharjah where allnon-GCC UAE residents willbe able to own residentialapartments on a leaseholdbasis. The ownership struc-ture for the project is a natu-ral corollary to theGovernment of Sharjah sig-

nificantly relaxing ownershiprules recently.

Al Rayyan, which was firstlaunched in December 2007,was stalled due to the finan-cial crisis of 2008-10, despitehaving made a few sales,Randa Kamal, CEO of JMSProperty Development &Management told Gulf Prop-erty. “The world went into arecession. We all know howreal estate projects were af-

fected at that time; many ofthem were delayed andmany of them stopped com-pletely,” Kamal said.

Moreover “after the reces-sion struck, the Central Bankinstructed all commercialbanks to stop funding realestate projects. So we had tostop working on the projectback then,” she said. Sheclaimed that JMS did notcompletely halt construction

Indrajit Sen Senior Reporter

JMS re-launches Dh700mAl Rayyan in SharjahJMS re-launches Dh700mAl Rayyan in Sharjah

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we did not take any pay-ments from them.”

Many ‘firsts’ for Sharjah“Al Rayyan developmentcontains many ‘firsts’ forSharjah. Mixed-use develop-ments have coupled the res-idential offering with retailand leisure facilities, or withcommercial space, but this is

at the time, but continuedwith a few partners on site,albeit at a ‘very slow pace’.

Kamal, who has been lead-ing JMS since 1988, also re-vealed, “We did sell a fewunits and those investorshave been with us eversince. We informed those in-vestors during the recessionthat we are going to go slowon construction for the time-being. But at the same time

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“The world went intoa recession [in 2008].We all know how realestate projects wereaffected at that time;many of them weredelayed and many ofthem stoppedcompletely. After therecession struck, theCentral Bankinstructed allcommercial banks tostop funding realestate projects. So wehad to stop workingon the project backthen.”

– Randa Kamal, CEO of JMS Property

Development &Management

the first to combine all threelifestyle elements of living,leisure, and work. Al Rayyanwill provide tenants and own-ers with an environment thatis unsurpassed for quality oflife, and that complementsmodern family living in Shar-jah,” Kamal said of the proj-ect.

Al Rayyan will comprisetwo residential towers, acommercial tower, and a re-

The team behind Al Rayyan project atit’s relaunch event

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we look forward to announcea prestigious partnershipvery soon, along with otherpartnerships across other as-pects of the project,” Kamalannounced at the launch ofthe project.

Al Rayyan is strategicallylocated in Sharjah’s AlNahda district, and is at ashort distance from both theDubai and Sharjah airports.One of the other significantadvantages of the project isthat it is also within easycommuting range of theAmerican University of Shar-jah, Sharjah University andcommercial centres of bothDubai and Sharjah, making itconvenient for both profes-sionals and students.

Al Rayyan is being de-signed by Canadian architec-tural firm B&H. “The designof Al Rayyan is particularlyfocussed on the interiors andis another first for Sharjah.This development is de-

signed for the modern fam-ily,” Kamal said of the project.

“Our area of expertise islarge-scale residential andcommercial, and mix-usedprojects,” said Tõnu Altosaar,Senior Principal Director,Middle East and North Africa,of B+H Architects.

“We tried to balance cre-ativity and responsibility. Wetried to living create space.We were really patient whiledesigning the towers. Fortu-nately we had experienceand a partner who share ourvision. The project has beendesigned to world-class stan-dards using sustainable ma-terials. It will be a city withina city.”

Altossar said he wished tooffer space within Al Rayyan;an aspect he found missingin most other towering resi-dential structures in the UAE.“I think the mixed-used tow-ers (of Al Rayyan), with thespace that has been used to

build them, is a first for Shar-jah.

“If you look at the buildingsin the UAE, there are towersafter towers, with no spacebetween them. We created anice living space within thecomplex. We tried to createa functional and practicalbuilding,” he stated.

The recent lethal fire acci-dents in Abu Dhabi, whichclaimed the lives of 10 work-ers, and in Dubai where mul-tiple residents of The Torchtower were rendered home-less, has not just spurred de-velopers to strictly implementsafety codes, but has alsoalarmed buyers/investors topay attention to safety as-pects.

Altossar assures the apart-ments at Al Rayyan havebeen designed to meet thehighest safety standards.“The computerised buildingsystems will be monitoringsafety. Latest technologies

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tail complex. The residentialbuildings will contain a totalof 504 spacious units, rang-ing from one- to four-bed-room apartments, with fullaccess to men and women’sspa facilities, landscapedleisure areas, gym, a sizableswimming pool and 24-hourconcierge and security serv-ices. The starting price for a1 bedroom apartment, span-ning an area of about 1,300square feet, would beDh750,000, the media wastold.

The two-storey retail mallwill include a hypermarket ofover 19,000 square metres,as well as up to 90 shops.The commercial tower willhouse premium offices andfacilities, with the top 12floors of the structureplanned to consist hotelapartments. “We are pleasedto say that we are also in ne-gotiations with premium hoteloperators for this project and

is now complete and the en-tire project appears to begetting ready for delivery inQ2 2016. “We underwent a little bit ofdelay, because we changedthe concept of the commer-cial tower from being only of-fices to housing offices andhotel apartments,” Kamal ac-knowledged.

Terna Construction is themain contractor for AlRayyan and this is their firstproject with JMS. “We hadother contractors with whomwe worked before, but forthis project we thought ofhaving a little change,”Kamal remarked.

Al Rayyan’s total value ofdevelopment is beingpegged at Dh700 million,and the cost excludes that ofthe hotel apartments and theplot (which Kamal estimatesto be about Dh260 million).The project is mostly beingfunded by Sharjah Islamic

Bank, which is also providingmortgage facilities to buyers.

Property management andadvisory firm Cluttons is theexclusive sales agency for AlRayyan and is also offeringsales and marketing adviceto JMS.

“We’re very pleased to beworking with JMS PropertyDevelopment and Manage-ment. Al Rayyan will attractbuyers seeking a high qualityfamily lifestyle, and thoseseeking a convenient loca-tion,” Steve Morgan, CEO ofCluttons Middle East said atthe press conference.

Al Rayyan’s proximity toboth Sharjah and Dubaimakes it an appealingprospect for both real estateinvestors and homeowners,who are likely to be locals aswell as Saudi, Qatari, Indian,Pakistani and British nation-als, according to Cluttons’ re-search.

“With freehold property

available to locals and lease-hold available to all expatri-ates UAE residents, weexpect residential, commer-cial and retail units at AlRayyan to be in high de-mand,” Morgan further saidof the project’s advantages.

In addition to the leaseholdownership structure, com-mercial units will be sold tobusinesses on a ‘shell andcore’ basis, giving compa-nies the freedom to createtheir own office spaces.

When asked how well themarket would respond to AlRayyan, Morgan was quickto respond saying, “I gen-uinely think it a new projectfor Sharjah in terms of thequality it provides, the finish-ing that you are seeing. Andthe whole lifestyle it will offer.Considering a few positiveaspects of the Sharjah prop-erty market, Cluttons is con-fident that Al Rayyan will bea success.” g

have been installed, namelyweb monitoring systems,smoke detectors all over theapartment, sprinklers in allthe rooms and corridors andthe stairs. We are also wellventilated,” he said told themedia.

“In case of emergencies,we are at an advantage com-pared with The Torch, whichis 337 metres in height.Evacuation, during emergen-cies will be far easier in ourcase. We actually passed allthe safety requirements,” an-other representative of B+HArchitects said.

Al Rayyan backon trackAl Rayyan is now back ontrack, with JMS havingcleared all hurdles with re-spect to financing and per-missions. About 65 per centof the project’s construction

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What does a fam-ily expect whenthey move intoa new house –safe and secure

environment for the kids,basic community facilitiesavailable at the doorstep,easy commute to work andall the places nearby. Takingall this into consideration, AlZahia, Sharjah’s first evergated mixed-use community,promises to create a new erafor residential community liv-ing in the emirate of Sharjah.

Sharjah, as we all know, isthe cultural and the educa-tional hub of the UAE, boast-ing of all the goodeducational institutions andcultural centers. Al Zahia,owned by Sharjah Holdingand managed by Majid AlFuttaim Properties, will em-body Sharjah’s traditionalvalues in a progressive andcontemporary setting whileoffering homeowners a safeand secure community. Bybringing together interna-tional ideals of living withSharjah's deep-rooted familyand cultural values, Al Zahiais truly a comprehensivelydesigned integrated commu-nity offering a well-rounded

lifestyle.The community is situated

between Sheikh MohammedRoad and University CityRoad, close to the SharjahUniversity City, Sharjah Inter-national Airport and SharjahAirport International FreeZone (SAIF), with major roadlinks to Dubai and the north-ern emirates.

“Al Zahia is a landmark de-velopment, it announces thebeginning of a new era inSharjah’s real estate sectorand marks Sharjah’s firstever integrated mixed-usegated community. It will alsohelp diversify the real estatesector of the emirate,” saidBader Hareb, Chief Property

Officer for Majid Al FuttaimPropert ies-Communit iesBusiness Unit, in an inter-view with Gulf Property.

What will AlZahia offer?Al Zahia is one of the proj-ects of Sharjah Holding, astrategic partnership be-tween the Government ofSharjah and Majid Al FuttaimProperties. Sharjah Holdingwas established in 2008 inline with the vision of H.H.Sheikh Dr. Sultan bin Mo-hammad Al Qasimi, Memberof the Supreme Council ofthe UAE and Ruler of Shar-jah, under the guidance of

Paromita Dey Senior Reporter

MAF starts delivering AlZahia villas to buyersMAF starts delivering AlZahia villas to buyers

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around 1,300,000 squaremetres. Overall the projectwill offer 349 villas, 800 town-houses, 1060 garden apart-ments and 61 boutique villas.In addition, there will be12,600 square metres of re-tail cluster, 2 mosques and 5neighbourhood parks.

As many as 49 homeown-ers have already taken pos-session of their newproperties with the upcomingnew release of homes, whichis underway, marking con-struction of another 277 unitsto be completed by the sec-ond quarter of 2016. Asclaimed, Phase 2 is now 90per cent sold and the lastand final phase is estimated

for completion in 2019. “Ourproject is quite different fromwhat other developers offer.We care about the end-users, that is why we havecarefully built a masterplanthat grows organically. Theidea behind phasing the proj-ect is that people staying inPhase 1 will not be disturbedby the machinery and drillingworks being conducted in theother phases. Hence there issome fundamental differencebetween what we do andwhat the market is offeringcurrently,” mentioned Hareb.

The management claimsthat the pricing for the projectis highly competitive, a villain phase 1 costs around amillion Dirhams, whereastownhouses in phase 2 willstart from around Dh1.9 mil-lion. Studios will start fromDh300,000 and as Bader ex-plained, the prices will go upbased on the location, heightand other amenities. “I thinkthe price range is suitable forthe market in Sharjah, Dubai

and other emirates, verycompetitive.”

The company also plans tomake it easy for buyers, byjoining hands with banksADCB and Sharjah Islamicfor easy mortgages andcompetitive payment plans.As Lee Tabler, Executive Di-rector-Communities, Majid AlFuttaim Properties, ex-plained, “We definitely planto come up with an attractivepayment plan soon. For ex-ample, in phase 1, the buy-ers had to pay 10 per cent onreservation, 10 per cent onsales and purchase agree-ment (SPA), and 80 per centon handover. In phase 2, wemodified it a little bit, buyerswill now pay 10 per cent onreservation, 10 per cent onSPA. Then we have a seriesof payments, leading up to50 per cent, where the buyerwill get a mortgage from thebank.”

He also added that theapartments, which they willlaunch soon, will also have

H.H. Sheikh Sultan bin Mo-hammed bin Sultan AlQasimi, Crown Prince andDeputy Ruler of Sharjah andH E Majid Al Futtaim, founderand president of Majid Al Fut-taim Holding.

The project offers a rangeof 3, 4 and 5-bedroom town-houses and villas, rangingfrom 2400 to 3700 squarefeet, in addition to studios,and 1 and 2 -bedroom apart-ments, ranging from 530 to1020 square feet.

There will ultimately beseven phases in the devel-opment of Al Zahia. It will fi-nally be home to over 12,000residents in 2270 residentialunits and span a total area of

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different and a favorable pay-ment plan. “We are very mar-ket driven, I cannot disclosethe details right now, but yes,we are very consumerfriendly.”

The community also pro-vides boutique villas cateringto the commercial needs ofthe Sharjah business sector.Phase 2 will have 24 bou-tique villas on the perimeterof the project, allowing in-vestors to set-up commercialactivities. “We haven’tplaced them in the marketyet for sale, we are still in theprocess of modifying the in-teriors and exterior. Therehave been lots of interest inour boutique villas, but wesimply haven’t focussed onselling them yet. We will notallow manufacturing shops,

only soft business mostly re-tail shops and small offices,”mentioned Tabler.

OwnershipstructureThe project is open for buy-ing to GCC and Arab nation-als as a freehold project, asper the law of the Govern-ment of Sharjah. But theproject is still under initial ap-proval stages in the lease-hold process for non-Arabnationals. Tabler stresses onthe fact that it is only a matterof time that the process willbe completed soon. “Wehave our initial approval be-fore going through the for-mality of getting it approvedby the Municipality and Shar-

jah Real Estate RegulatoryAuthority.”

But certain other projects inSharjah have already startedproviding leasehold projectsto non-Arabs, to which Tablerreplied, “The first project thatoffered leasehold to expatsoffered land plots, not ready-made villas. We will be offer-ing built up villas and townhouses. We believe that wewill receive our approval verysoon, maybe sometime inthe first half of 2015.”

The villas in Phase 1 arecurrently built to suit the tasteof a contemporary Arabicfamily, mixed with a tradi-tional touch and feel. Butonce Al Zahia gets the lease-hold approval for non-Arabs,will there be establishmentsthat would suit the taste of an

expat family? Hareb said,yes, definitely. “Now the vil-las in Phase 1 are quite suit-able for an Arabic family. Wewill have phases, where wewill offer studios and gardenapartments; units preferredby non-Arabs. The currentphase addresses what ourcurrent clients are lookingfor. Once we get the ap-proval, then we will think ofwhat to do next.”

Also, according to Hareb,people in gated communitiestypically take better care oftheir home. “This transformsinto an added value for theproperty over the long term,tying in perfectly with Majid AlFuttaim Properties’ focus oncreating sustainable livingenvironments designed forlifelong value,” he said.

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Specialising in community-oriented developments,Sharjah Holding can also layclaim to being the first intransforming the emirate’smixed use real estate sector,having accomplished suc-cess with the introduction ofMatajer outlets, being thecommunity’s first neighbour-hood malls in Sharjah.

As Tabler mentioned, “Wehave to be careful about howwe label the project. Ours isa high-end community, offer-ing great value for money.The malls by MAF have al-ways targeted upscale mid-dle income customers.That’s what we believe is AlZahia is, upscale middle end.It’s affordable, but it’s a qual-ity community.”

Tabler also stressed on thefact that MAF, as a devel-oper, does not believe in cre-ating volumes, they aim tocreate a brand and offerquality living. Although Shar-jah Holding is a profit-ori-ented joint venture by thetwo names, but profits arenot earned at the cost of cre-ating a proper brand. “Weaim to create a brand, a highquality product. Yes, we def-

initely need to make profits,Sharjah Holding is a profitoriented JV but not at thecost of creating a properbrand. We manage our con-struction costs carefully, sothat we can price the productreasonably. We believe themarket is going to receive itpositively.”

To this, Harb added,“These lands, on which theproject is being built, isowned by the Government ofSharjah. Dividends will bedistributed in the form of prof-its, 50-50 between the twoparties.”

Other community livingprojects by Majid Al Futtaimincludes The Wave in Mus-cat, Oman and WaterfrontCity in Beirut, Lebanon. Thecompany owns and operates17 shopping malls, 11 hotelsand three mixed-use com-munities in MENA, with fur-ther developments underwayin the region. The shoppingmall portfolio includes Mall ofthe Emirates, City Centremalls, and also four commu-nity malls which are in jointventure with the Governmentof Sharjah. It holds exclusiverights to the Carrefour fran-

chise in 38 markets acrossthe Middle East, Africa andCentral Asia, operating aportfolio of over 55 hyper-markets and over 65 super-markets in 12 countries.

The company has thesame goals for the emirate ofSharjah, create a uniquebrand and expand to tap intothe real estate market in theemirate. “The relationship isa long term strategic partner-ship between the Govern-ment of Sharjah and MAFProperties, and the goal is toexpand in Sharjah with com-munity living and Matajershopping centres, whateveris necessary for Sharjah. Wewould not look into otheremirates until we have cre-ated a very successfulbrand. Today we alreadyhave a successful Matajerbrand, a community shop-ping centre and we are closeto creating a successful AlZahia community brand.Once we achieve success,then we will think of expand-ing,” mentioned Tabler.

He also added that Sharjahis a large emirate with lots ofopportunities for develop-ment. g

Looking aheadAl Zahia is the first commu-

nity project for Sharjah Hold-ing, a high-end communityyet being offered at afford-able prices. The project,which echoes MAF’s vision,namely ‘creating great mo-ments for everyone, every-day’, will generate a 10-yearlarge scale employment ben-efit during the constructionphase. As claimed, subse-quently, it will not only supplysignificant jobs for the peopleliving in the emirate, but thedevelopment will also stimu-late the local economy. Assuch, Al Zahia’s estimatedcontribution to the Sharjaheconomy is anticipated toreach around Dh5 billion.

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