Yahoo Finance Dubai revives palm islands project with plans for luxury mansions and hotels
The ruler of Dubai has revived plans to develop a man-made, palm-shaped archipelago off its coast after the project was mothballed in the wake of the financial crisis.
The Palm Jebel Ali development will feature dozens of hotels, resorts, offices and luxury villas, along with more than 60 miles of beaches under new proposals approved by Sheikh Mohammed bin Rashid.
The vast scheme was first started in 2002 and is a larger version of the nearby Palm Jumeirah, a sought-after property hotspot that has become a favourite of Russian oligarchs fleeing Western sanctions.
While the artificial land mass has been completed, work on Palm Jebel Ali was halted soon after Dubai’s property market crashed in 2008. At the time, only a small amount of infrastructure had been completed.
The project is being revived after a huge surge in Dubai property prices. Sheikh Mohammed approved plans for the land’s development as part of a refreshed urban masterplan for the city.
“Development is a non-stop journey in Dubai,” Sheikh Mohammed said in a statement.
Palm Jebel Ali is one of three artificial island complexes originally envisioned by the government, aimed at cementing the city state as a destination for tourists and the ultra-wealthy.
Residents of its smaller sibling, Palm Jumeirah, include the likes of David and Victoria Beckham, who own a seven-bedroom mansion among its artificial fronds. Russian oligarch and former Chelsea Football Club owner Roman Abramovich was also reported to have viewed properties there.
A third complex further up the coast, which would have been called Palm Deira, has since been scaled back and renamed “Dubai Islands”.
Palm Jebel Ali will be the biggest of the developments, spanning seven connected islands and covering eight square miles – twice the area of Palm Jumeirah.
The sprawling development includes a 12-mile breakwater, constructed from vast quantities of dredged up sand and blasted mountain rock. The structure forms an outer protective ring that protects the inner landmasses from strong waves.
Behind the breakwater sit 17 curved, sandy arms that split off an almost four-mile trunk – forming the shape of a palm tree from above.
The scheme, which is overseen by state-owned developer Nakheel, will provide accommodation for 35,000 families and host 80 hotels and resorts, Dubai’s government said.
Previous proposals included waterfront homes on stilts, promising to make dazzling ocean sunsets “an everyday experience” for residents, although it is not known if these have been retained in the latest proposals.
Simon Baker, managing director of Dubai-based property agent Haus & Haus, said rumours about the project’s revival had been swirling for months before the official announcement.
Dubai’s property market soared at the fastest rate in the world during the pandemic thanks to its comparatively lax Covid restrictions. The city was flooded with buyers from Europe and America who were fleeing lockdown at home.
Selling prices of the most expensive homes jumped 50pc higher during the pandemic, with researchers at Knight Frank forecasting prime prices will jump another 13.5pc this year.
Mr Baker said the cost of property per square foot in Dubai still looked cheap to wealthy buyers, when compared to other popular cities such as London and New York.
Whereas luxury property might cost $3,000 to $5,000 per square foot in London, in Dubai it is closer to $2,000, he said.
“To those willing to pay, that sounds quite reasonable even though they have gone up,” Mr Baker added.
“We have already had wealthy clients this week calling us, asking to buy 10 villas and saying they are willing to spend $100m.
“So the problem is not likely to be demand, it is going to be availability.”
A five-bedroom luxury beachfront villa on the Palm Jebel Ali is expected to cost upwards of $3m.
Dubai has no income tax and Mr Barker said this was a draw for many ultra-wealthy buyers.
However, he said: “The biggest reasons we are hearing today are more to do with safety and security, and family life.
“People want to live in an environment where they feel comfortable that their kids can walk down the street at night and they won’t have any problems.”
Nick Candy, the luxury developer behind One Hyde Park in London, echoed this sentiment in recent months when he said he was focusing his attention on Dubai’s property market.
Mr Candy said he was fed up with crime in London and the teaching of controversial transgender issues in schools.
“Some of the values we once cherished in Western countries are not the same values that we’ve got today and actually, who would have thought, the value system sometimes is better in the Middle East than it is here,” he said in April.
