UAE-BASED DAMAC HOLDING FOCUSING ON REAL ESTATE DEVELOPMENT IN PAKISTAN
This fresh arrival in the real estate industry of Pakistan is expected to launch a residential project in Islamabad.
Apr 30 - May 13, 2007
Damac Holding, a UAE-based company with an impressive profile of investment in Middle East, is now in the process of launching its first project in Pakistan. Damac is also making progress on entering the huge Indian property market as well, sources told PAGE.
This fresh arrival in the real estate industry of Pakistan is expected to launch a residential project in Islamabad. According to Peter Riddoch, Chief Executive Damac Properties, it could happen in the next two months.
Pakistan is an attractive place for doing business in the real estate as compared to other countries in the region, for example, India. It is much easier to acquire land by the foreign investors for property development as compared to India where acquiring land by foreign developers is an uphill task. It takes much time to complete the complex procedures and getting NOCs from the relevant authorities. Though Damac has a plan to launch property development both in India and Pakistan, its development in Pakistan may start coming up within a couple of months.
Actually, Damac is coming to Pakistan with a program of massive property development in the country, however, the starting point they have chosen is Islamabad project which will be followed by developments in Karachi and Lahore as well.
Sources said that Damac also intends to launch a residential project in Oman as the UAE-based company pursues overseas expansion.
Damac, having an impressive development record to its credit, has 60 real estate projects in six countries. Half of its portfolio is in the UAE and has a value of Dh12 billion. Damac recently announced its most ambitious residential and tourism project on Egypt's Red Sea coast. The Dh60 billion plan involves development of 3,000 hectares of land at Gemsa Bay and includes luxury hotels, 5,000 villas, an 18-hole golf course and a marina.
It is pursuing discussions in India to develop real estate in key cities but legal and regulatory processes have slowed its efforts. Chairman Hussain Sajwani said acquiring land in India is proving to be a difficult process.
While the company has decided to go it alone in Arab countries, Sajwani said he is willing to have partners in India because of the large size of the country and cities. The company could be looking at partners in India.
Damac's first Indian projects may be launched in Hyderabad and New Delhi followed by Bangalore and Mumbai. A mixed-use development is under discussion in India.
Seven-Star Hotel and a 40-storied Building at Karachi Airport
Meanwhile, a seven-star hotel and a 40-storyed building accompanied by shopping malls and upper class residential and office accommodations have been proposed in the vicinity of Karachi Airport by Qatar investors.
These mega property projects, however, needed clearance from Pakistan Air Force (PAF) and Civil Aviation Authority (CAA) because of close vicinity of these projects to the sensitive airport area. Clearance from relevant authorities is a prerequisite prior to initiating construction, however, knowledgeable sources told that approval for these projects is in the pipeline, as the CAA desires to develop the peripheral area for revenue generation on one hand and appealing to the visitors and investors on the other.
According to CM's Spokesman, a three-member Qatari delegation accompanied by Jean Marc Rigen, General Manager, and Choudhry Muhammad Wasi, General Manager Qatar Islamic Bank, led by Saifurrehman, had a meeting with Chief Minister Sindh to discuss prospect of forthcoming development projects in Karachi and in other parts of Sindh.
Chief Secretary Sindh, Secretary (LU) Board of Revenue, Secretary Livestock and Fisheries, Secretary to CM, Director General Board of Investment and Chairman CMIC.
Speaking on the occasion, the Chief Minister apprised the delegation regarding various important decisions of the cabinet which has approved in principle 3,000 acres land for livestock project at Nabisar and the rest 7,000 acres near Thatta. For setting up a cement plant, the Chief Minister directed the Board of Revenue to arrange a specific site either at Thana Bola Khan near Nooriabad or some other site near Thatta that should have adequate source of raw material supply such as lime stone and clay with other material required for the cement production.
CONCERNS OF THE DOMESTIC PROPERTY DEVELOPERS
The beginning of mega projects by international property developers is a positive sign for the industry as well as the national economy as it is bound to bring new technology in the field of construction in Pakistan, said Hafeez Urrehman Butt, Chairman Association of Builders and Developers (ABAD) while talking to Pakistan & Gulf Economist.
He, however, observed that the domestic property developers have reservations on the discriminatory attitude of the authorities by not providing a level playing field both to the foreign and domestic developers.
Citing the example of what he called the discrimination between foreign and domestic builders, ABAD Chairman observed that the domestic developers have to get them registered with various governmental development authorities like Building Control Authority etc and NOCs from different authorities, without which they couldn't even advertise their projects.
Contrary to that, the foreign investors have been given a free hand as they are announcing their projects in the media without getting approved the building plan, map and other prerequisites. The foreign developers even did not bother to join the builders association or obtain usual approval from building control authority. "You cannot operate in this manner in other countries of the region," he remarked. Actually, the domestic investors provide a reason to the foreign investors hence they should not be ignored like this.
Citing another example of overriding the set principles and rules in the case of Karachi Financial Towers, Hafeez Butt said that 1X6 ratio is allowed as a covered area for developing any multiple storied projects. The developers of Karachi Financial Towers had asked the government for relaxation in this rule with the request to allow them 1X12 ratio for covered area. The Chief Minister Sindh constituted a committee to look into the matter, which subsequently formed another sub-committee to look into the matter. That committee was represented by relevant government and private sector organizations that rejected the proposal in view of growing congestion at I.I Chundrigar Road. However, the authorities using their discretion overruled the decision of the sub-committee and allowed the sponsors of the project to go ahead. "This is something strange. If such relaxation can be given to foreign developers then why the domestic developers are being subjected to such rules?" he questioned. The domestic builders and developers have played a significant role in the development of the urban areas in Pakistan, especially the metropolitan city of Karachi. Let them play their due role and have their due share in the development process of the country, he remarked.