Tuesday, 5 May 2009

Dubai free zones record significant drop in rent rates

With the drop in demand owing to global economic crisis, rents for office spaces in Dubai Free Zones have also dropped considerably, noted an industry analyst.

The Research Analyst at CB Richard Ellis, Mohammed Faheem, said that the average rates of privately managed buildings in the free zones have dropped from the Dh.240-380 per sq ft range, to Dh.92-180 per sq ft during the first quarter of this year, thereby indicating a 52 to 61 percent drop.

This is a clear indication of decrease in demand. The free zones included in the survey were the Media City, Internet City, Dubai Silicon Oasis, Knowledge Village and Jumeirah Lake Free Zone.

Rents within the various zones vary from one another with few zones implementing rate restrictions to stimulate demand from occupiers. The buildings managed by free zone authorities have rents in the range of Dh.170-190 per sq ft.

The Dubai International Finance Center (DIFC), the special economic zone located in the central business district of the city, has fared much better, standing out above the rest of the prime locations in Dubai, with average rents ranging from $115-123 per sq ft. This is mainly because DIFC is a popular location among companies seeking to move in to Dubai.

Although, the lower rent rates in few of the free zones in Dubai, makes it more attractive, it really depends on the motive of the free zone managers. The rents are affected within the free zones mainly because the authorities have a different agenda than the commercial landlords, says Nicholas Maclean, Managing Director, C B Richard Ellis.

Multiple entry visa for property owners in UAE

Property owners can now enter UAE on a multi-trip entry visa, which permits them for a stay of up to six months, according to a new decree issued by the Interior Ministry.

This move is hoped to improve the local economic environment and offer all fundamentals that would help ensure prosperity and economic growth in the country. The multiple-entry permit can be renewed under certain conditions.

The regulation forms a part of the efforts by the UAE government to introduce adequate regulations to boost the local economic sector and offers all factors that aims to contribute to the growth and prosperity of the local markets and be of benefit to the public.

This initiative would benefit people seeking to bring in their families to the UAE, and this emphasizes the keenness on the part of the government to provide them with family stability.

A new clause has been added to the Article 33 of the new regulation, which states that owners of built-in properties are allowed to stay for a six-month period, after which, the owner can depart to his home country or stay in any of the GCC countries. He can however, enter the country again, after meeting the necessary criteria.

Another new article of the new regulation, states that the owner must submit a multi-trip entry visa, with respect to the property, under the following conditions.

* The property should be a built-in property, and should not include owners of vacant lands.
* The title of the property should be obtained from the Property Registration Authority in the emirate, by the owner. Also, the house or the apartment should be wholly owned by the owner.
* The cost of the unit should not be less than Dh.1million. The unit should have the capacity to accommodate the members of the family. The owner can include his spouse and children's details in the visa application, and attach an insurance cover for himself and his family, which would be valid during he period of their stay in the country.
* The fixed income of the owner should not be less than Dh.10,000 or its equivalent in foreign currencies, whether inside or outside the county, although the visa doesn't offer the owner the right to work within the country.

The permit would be considered invalid if any of the above terms are not met. The regulation would be effective from its date of issuance.