The recovery of the UAE real estate market from the COVID-19 pandemic will take a minimum of 12 to 24 months, as per the Dubai developer DAMAC Properties’ chairman Hussain Sajwani. His agency registered a total loss of 190 million dirhams ($51.7 million) for Q1 2021, in comparison to 109 million dirhams a year before.
Losses were primarily because of the lower revenue recognition as many projects are nearing completion, compressed total margins due to revenue-mix and higher selling and general administration expenses resulting from higher booked deals registered during the quarter, the developer said in a bourse filing.
“The market is slowly recovering from the effects of the COVID-19 pandemic and its impact on various industries, particularly travel and tourism. I still strongly believe that recovery will take at least 12-24 months,” Sajwani said.
DAMAC, which owns the Middle East’s only Trump-branded golf course, registered revenue of about 642 million as it booked sales of 1.1 billion dirhams and deliveries of about 1,350 units in Dubai.
The pandemic has further added pressure on Dubai’s over-supplied property market. However, there has been a rise in purchasing and interest in recent weeks as investors looked to take advantage of the lesser prices for new developments.
“With the UAE government’s excellent handling of the pandemic and EXPO 2020 coming up, these are all positive indicators which make me cautiously optimistic. However, we must remain patient and guarded going forward as the global economy is still reeling from the effects of the pandemic and will take time until markets fully rebound,” Sajwani added.
DAMAC’s rival, Emaar Properties, registered an 8% year-on-year increase in Q1 net profit to 657 million dirhams.