Monday 25, April 2016

Dubai – MENA Herald: Luxury real estate developer DAMAC Properties is providing one-of-a-kind opportunities for individual investors to tap into the growing and high-potential hospitality sector. The developer had made investments in hotels in prime areas in Dubai within the reach of a greater number of investors by reducing investment amount, allowing customers to invest in an individual hotel room for a future stream of income and a free stay every year.

With an ambitious target set out by the Dubai Government to boost its tourism figures to 20 million visitors annually by 2020, a Compound Annual Growth Rate (CAGR) of seven to nine per cent in leisure and businesses visitors over the next 10 years is expected to be achieved. Recent figures for the first two months of this year of 2.68 million visitors to the emirate vs 2.59 million for the same period last year, representing a nearly 4% increase, is already a positive sign of things to come for the period ahead.

Ziad El Chaar, Managing Director of DAMAC Properties, said: “Dubai’s status as a world-class holiday, business and leisure destination is undeniably on a growth trajectory and gathering momentum by the day. With the upcoming Expo 2020 and other developments that will further reinforce Dubai’s position on the world stage, we are gearing up by developing and delivering more than 13,000 additional keys by 2021 to add to our existing portfolio of 2000 plus hotel keys and to Dubai’s inventory of premium hotel rooms to meet the future demands for luxury accommodation.”

“In 2015, Dubai attracted 14.2 million tourists, up 7.5% from 2014, and this year is on track to achieve the goals outlined in Dubai’s Tourism Vision 2020. DAMAC Properties is doing what has never been done before in Dubai, by making it very possible for individual investors to own a hotel room in a prime location, with title deed, and reap a significant return on investment in the world’s fastest growing property investment market,” he added.

The high-yielding investments in hotel rooms available to individual buyers start at AED 440,000 only. Considering that prior to now, investment in the hotel sector was only feasible for large investors, family offices or development companies due to the prohibitive investment associated with it.

With the new offering, individual cash buyers and those who opt to finance their purchase will be able to own a unit and be part of the booming hospitality market. The asset promises to be lucrative with an estimated 10% return on investment annually, offering higher returns than residential or commercial real estate.

DAMAC Properties recently launched for sale freehold hotel rooms within the iconic AYKON City project to be centrally located on Sheikh Zayed Road in Dubai’s Golden Quadrant, overlooking the Dubai Canal, the up-and-coming prime location. The units in AYKON City, starting at AED 800,000, will be managed by AYKON Hotels & Resorts, one of the four hotel operators under the umbrella of DAMAC Hotels & Resorts. Other investment opportunities are also available in DAMAC Towers by Paramount Hotels & Resorts, located in the Burj Area of Dubai, and featuring the world’s first Paramount Hotel.

The opportunity to fully own a hotel room is new to Dubai and the region. Investors who opt to own a hotel room can enjoy high rental yield and property value retention. The hotel rooms are available with full ownership rights with title deed, allowing investors to sell at any time, unlike timeshare arrangements that have been popular in international markets and have recently begun to be introduced in Dubai. Investors will also not deal with the hassle of managing their property as all the rooms will be entered into a ‘rental agreement’ which means the administration, management, bookings and maintenance is taken care of by the hotel itself and a return on investment is recouped every year. Furthermore, the owner will also have rights to make it available for 2 weeks a year for personal use.

DAMAC Hotels & Resorts consists of AYKON Hotels & Resorts, DAMAC Maison Royale, DAMAC Maison and DAMAC Maison De Ville – four distinct operators to target various customer segments.