 DUBAI or not DUBAI? - By Laura Mcmahon When my I told my friends and family three years ago that I was going to live and work in Dubai the first thing they asked was ‘Where is that?’ When I told them that Dubai was a part of the United Arab Emirates in the Middle East they’re next two questions were ‘Are you mad?’ and ‘Why the hell would you want to go and do that for?’ Sand, camels, oil, terrorists, war, women in veils, men with guns. These are some common perceptions of people who have never lived in the Middle East. These perceptions are fueled and driven by the media who ram images of chaos and misery down our collective throats on a daily basis and have much to answer for in today’s climate of fear and misunderstanding. Through a couple of isolated conflicts they make the Middle East look like one big chaotic bomb site with carnage waiting around every corner. And while I would never make light of events In Iraq or in Israel and Palestine, in Dubai and 95% of rest of the Middle East for that matter, we might as well be watching it from the comfort of our recliner chair back in America. My travels around the Middle East have shown me repeatedly that the people of this region are cultured, educated, peace loving people whose Muslim faith is about respect, love and charity. As a woman I feel totally safe walking through the streets of Dubai in the evening. This is not something I can say for other places I have lived like England, Ireland, The States or even New Zealand which has world leading reputation for being a ‘safe’ environment for people to live in. Now that I feel that I have done my best to clear up some of the media driven misconceptions lets get onto the really good stuff about this pearl of a city for property investment and living in called Dubai. In the late 1960's Dubai was a small fishing village on a finger of land pointing into the Arabian Gulf. A small community of people settled on the edge of the Gulf and survived on fishing and pearl diving. Behind them was a desert stretching for thousands of kilometers in which nomadic tribes roamed. This way of living was also being played out in six other regions dotted around Dubai that would later combine into what is now known as the United Arab Emirates. Each Emirate had a ruler or a ‘Sheikh’. Who owned the land and ruled the people. This lifestyle was the same for hundreds if not thousands of years until a little over thirty years ago something was discovered, Oil. Black gold, Texas T. Over night the sheikhs became the ‘Clampets’ of the world. Unbeknown to them they were sitting on a rich, deep vein of oil that would take their small group of principalities from poverty to lavish wealth. It was decided that to best take advantage of the discovery and to share the wealth their emirates should unite and be ruled by one sheikh. This mans name was Sheikh Zayed Al Nayhan. From his palace in the Emirate of Abu Dhabi, which is the modern day Capital of the United Arab Emirates, Sheikh Zayed set about putting a plan in place that would make Dubai a world leading City of the Future. Much of what Dubai became in the new millennium is due to Sheikh Zayed’s Vision and determination. In the thirty years to date his plan has taken the small village of Dubai to the fastest growing city in the world today. With projects like ‘The World’ a massive representation of a map of the world sitting on top of the ocean off the coast of Dubai in which countries are islands and can be bought. Purchasers include Rod Stewart and Elton John. The Palm is an enormous representation of a Palm tree sitting on top the ocean and offering thousands of villas, apartments and hotels. A certain man by the name of Donald Trump has set up in Dubai with a Trump Hotel being built on the Palm. Incredibly there is not just one Palm being constructed but three! Then there is the Burj Dubai the tallest building on earth, Mall of Arabia the largest Mall in the world and Dubailand a theme park that will make Disneyland look like an entertainment Relic. These are all currently under construction. Now here’s a question for you. If you were offered some real estate in Disneyland before it opened would you have bought some? You can purchase hotel apartments within the grounds of Dubailand through certain developers with a minimum of 8% rental return guarantees for three years and occupancy availability for you and your family every year. Dubai is the Californian gold rush town of the new millennium and real estate is dirt cheap in comparison to other leading cities of the world. But Dubai has not just relied on oil for its progress, it has recognized the importance of tourism making it a holiday paradise by taking advantage of its superb year round climate, white sandy beaches and pale blue waters and equalising it with some of the most luxurious resorts in the world. There was also an early understanding of the importance of building a trading environment that attracted businesses to use Dubai as a trading base by initiating ‘free zones’. Simply put these free zones of which there are now fifteen around the UAE allow businesses to trade with the minimum of red tape and customs charges. The Jebel Ali Free Zone was the first and biggest free zone created in Dubai. It was established following a Dubai Government decree on the 9th of February 1985 and is an incredible example of the entrepreneurial spirit of the free thinking city. Since its establishment the Dubai government has invested over USD 2.5bn into the zone to further its potential. It is the largest commercial and industrial ‘free zone’ in the Middle East and offers the best tax incentives in the world for both private investors and commercial business. It is directly linked to the Jebel Ali Seaport which is located about 40kms from Dubai city centre. The harbor is the largest, most advanced and efficient man made harbor in the world which in turn is linked to Dubai international airport’s state-of-the-art air cargo village. The village and the seaport combined allow for the world’s fastest sea-air transport turnaround in as little as 4 hours, and the strategic location of the free zone and Dubai itself allows for companies to have easy access to the 1.5 billion consumers in the countries surrounding the Gulf and Red Sea, furthermore there are no import or export duties payable within the zone and there is 100% repatriation of both profit and capital within the zone. To those individuals considering retirement with assets that they would like to invest in a state where their tax liabilities are limited, the advantages of the Jebel Ali Free Zone are also obvious! In fact any property buyers of free hold property in Dubai automatically qualify for a residence visa. With this residence visa you are able to reside in Dubai and open up a bank account with industry respected banks such as Citi Bank, Standard Chartered, Lloyds of London and HSBC to name a few. Once this is done you are free to move funds about between banks and repatriate money at your will, a very nice way to shelter some of your hard earned dollars from the Tax Man. As the Muslim religion forbids tax to be charged by the state. Not only is Dubai the gateway for trade between the middle east and the rest of the world it is also building the fourth financial district of the world in DIFC (Dubai International Financial City). This is a strategically important financial centre as it straddles the time Zones between New York, London and Hong Kong and makes the world financial markets a truly live twenty four hour a day market. It is also another business Free Zone which has inspired many of the world’s leading financial companies to put a regional office in Dubai’s DIFC seeing the potential of the market and the continued growth expected out of Dubai over the coming years. The United
Arab Emirates has never been richer with the price of oil spiking in 2005
and showing no signs of returning to previous levels. Much of the investment
in Dubai has been in real estate to cater for the huge numbers of businesses
and individuals now settling in Dubai but the real estate market is still
very young at thirty years old and with the currency pegged at 3.67 Dirhams
to the US dollar bargains are everywhere for the educated investor or the
owner looking for a villa in the sun. A new three bedroom villa in the
best location of Dubai or a two bedroom Dubai beachside apartment currently
runs out at about 2 million AED ($544,959.00 USD) Property owners are seeing
annual premiums of up to 35% of their land values and are getting
up to 15-20% premiums on rental returns.
The United Arab Emirates achieved 1.5 trillion US dollars of GDP in 2004. The United Arab Emirates has a population of approximately 4 million people. It has surpassed Egypt with a population of over 70 million people as the second biggest economy in the Gulf in 2005 just behind Saudi Arabia. The economic statistics are a mile long and every one of them spells success. This remarkable little Emirate with Dubai as its centre piece is taking on the world and winning through a business and expatriate friendly attitude combined with a determination to make Dubai renowned as destination synonymous across the globe for top class business, pleasure and leisure. Dubai’s climate is in a word is sunny. It rains on average three to four days in a year. I have just celebrated another mid winter Christmas in Dubai with temperatures around the low seventies. The climate is constantly superb for nine months of the year, which is great for all you sun worshippers, tennis players or golfers. The Golf courses are of course world class and you never have to worry about getting rained on or canceling your game in Dubai. It does get a tad sticky in the summer though with temperatures in July, August and September sitting in the low to mid nineties. But hey there’s always a chilled pool nearby at one of the many leisure clubs and which would you rather have to get through - a hot summer or a freezing winter? Maybe you could have the best of both worlds and winter in Dubai. Dubai could be compared to Las Vegas but only in the climate. It does not have the outrageously priced real estate, the Casino’s (gambling of any kind is prohibited by the Muslim faith) and any of the other unattractive derivatives that come along with the Las Vegas experiences. Dubai does have a vibrant nightlife and contrary to popular belief drinking is permitted in Dubai’s multitude of five star hotels with their beautifully appointed bars and restaurants. You can also purchase alcohol for consumption at home through a liquor license which is a simple formality to get. Sheikh Zayed recognized many years ago that for Dubai to be an attractive proposition to the Western World it would have to let some of the ways of the western world in which it has done very successfully without forgetting or cheapening its own culture and traditions. The UAE’s national airline Emirates with one of the most modern air fleets in the world offers twice daily direct flights to and from JFK which are a twelve hour duration. All of Europe is on Dubai’s doorstep with its farthest point, the UK a mere six and a half hours away. Dubai international airport handles over 55 airlines and about 150 flights a day and is second only to Tokyo in the number of daily transit passengers it handles. A state of the art new airport is currently being constructed which will take it to the largest airport in the world with the most passenger and air transport capacity. Dubai is a clean, modern, attractive city with stunning architecture, world class sporting, leisure and entertainment facilities, palm trees and beaches as good as any Island resort you can find, a stable currency, an affordable cost of living with a tax free environment to carry on or start your business in and a still young, vibrant and ever developing real estate market that is one of the best in the world in regards to land value appreciation and cost in comparison to other world leading cities. This all adds up to an investment and a lifestyle that is hard to beat. Now, how many of you knew all that about Dubai, this little pearl of a city? |