Dubai’s New Real Estate Law will Draw in Foreign Investment
Amira Sajwani, general manager of sales and development at Damac Group, predicts that a rise in foreign investment will result from the new law encouraging property investment funds.
On July 19, Dubai's ruler, Sheikh Mohammed bin Rashid Al-Maktoum, passed a new law to support the expansion of real estate investment funds there.
The law provides certain privileges to real estate investment funds as part of efforts to position the emirate as a global destination for real estate investment, according to Emirates Media Agency, also known as WAM.
A real estate fund, according to Investopedia, is a category of mutual fund that primarily invests in securities provided by publicly traded real estate companies.
A real estate investment trust, on the other hand, invests directly in property that generates income and is traded like a stock.
All real estate investment funds authorized and governed by government agencies, private development zones, and free zones, including Dubai International Financial Center, are among those covered by the law, according to WAM.
Investors will also be eligible for benefits that will support their real estate investments in the emirate.
So how will the new law help real estate investors and the nation as a whole?
The chairman and founder of D&B Properties, Husni Al-Bayari, claimed that the new law would boost transparency and governance while enticing investors and real estate funds to enter the market.
Al-Bayari added that it will help regulate Dubai's free zones and private development.
High-net-worth individuals are moving to Dubai as a result, and Al-Bayari noted that this legislation will open up new locations for relocating for both personal and professional reasons.
According to WAM, applicants with real estate assets worth 180 million dirhams ($49 million) or more are eligible to register.
The establishment of a register for real estate investment funds, in the words of Sajwani of Damac, "gives the added value of transparency, which is always good to attract more foreign entities to invest here."
She noted that a number of recent economic and social reforms have made Dubai more appealing, and the new law is the latest in this line of work.
The new law also establishes a special committee that chooses which regions and assets the funds may invest in, according to WAM.
Real estate investment trusts should be able to draw in 15% more investors, supporting liquidity and market growth, according to Alexey Galtsev, founder and CEO of Realiste, a personal artificial intelligence company focused on real estate investing.
The real estate registry, Dubai Land Department, will also appoint a specialist to appraise the properties owned by the funds, WAM continued.
The move comes as Dubai intensifies efforts to draw in foreign investors, with real estate being one of its focus sectors.
Galtsev added that the law encourages substantial investments in Dubai real estate and makes the UAE market accessible to significant inflows of investment capital.
Al-Bayari came to the conclusion that the UAE has recently come to be known as the destination of choice for millionaires. With the help of this initiative, Dubai will continue to rank highest among wealthy investors.
Source: Arab News