Why New Dubai is booming
New Dubai, the name coined for up-and-coming areas of Dubai including Jumeirah Village and Business Bay, is realising its true potential in 2023, with these exciting precincts driving Dubai’s record-breaking property market growth in the first half of the year.
According to official Dubai Land Department data published as part of Bayut’s Dubai H1, 2023 Property Report, Jumeirah Village Circle – which is home to The First Group’s award-winning upscale lifestyle hotel The First Collection at Jumeirah Village Circle – was the most popular location to rent affordable apartments in Dubai in the first half of the year.
Average apartment rental prices reported double-digit increases across the board in Jumeirah Village Circle compared to the second half of 2022, with studios reporting the highest overall increase of 17.2%. Average rental values also increased by 7.76% compared with H2, 2022.
As Dubai’s leading end-to-end hospitality solutions specialist, The First Group was one of the first hotel developers to recognise Jumeirah Village’s long-term potential.
In addition to The First Collection at Jumeirah Village Circle, which was named one of the world’s hottest hotels by TripAdvisor in 2022, the firm has two more hotels currently under development in the precinct – The One at Jumeirah Village Triangle and Avalon Tower – both of which offer savvy hotel investors prime opportunities to capitalise on the growing popularity of this dynamic precinct.
Dubai Marina shines in the luxury stakes
Meanwhile, Dubai Marina – which is home to Ciel, The First Group’s most ambitious project to date – was named the most popular destination in the city for luxury apartment rentals in the first half of 2022.
Average rental prices for upscale apartments in the area rose by 13.5% for 1-bed units, 8.56% for 2-beds and 10% for 3-bed units, according to Bayut’s research. The report attributed the price hikes to “landlords capitalising on increased demand by listing properties at higher price points”.
According to DLD data, the average rental transaction value also increased by 7% to stand at AED 104.8k (US$28,500).
Growing demand for premium accommodation options in Dubai Marina highlights the opportunity presented by Ciel and explains the unprecedented investor interest that has been generated by the development, which will claim the title of world’s tallest hotel when it welcomes its first guests in 2024.
Business Bay demonstrates its remarkable investment potential
Business Bay, which ranks among the city’s fastest-growing precincts and is another key focal point of development for The First Group, also demonstrated its incredible investment potential in the first half of 2023, with Bayut revealing that the average rental price for premium one-bedroom apartments in the area rose by 11.3% compared to the second half of 2022.
Average rental increases for larger apartments were even more impressive, with two-bedroom units rising by 13.5% and three-bedroom units increasing by 14.5%.
In addition to the The First Collection Business Bay, which boasts a five-star excellent rating on TripAdvisor based on more than 1,000 independent traveller reviews, The First Group is currently developing two more hotels in the area: The One Hotel at Business Bay and Dolphin Tower, both of which are scheduled to open within the next two years.
Discussing the Bayut report’s findings, Haider Ali Khan, CEO of Bayut and head of Dubizzle Group MENA, said the unprecedented popularity of these precincts reflected the “supply versus demand dynamics [that are] playing out strongly in the rental market, with [these] areas constantly being outpriced because of the supply crunch”.
“There is a lot of positive movement of wealth into the UAE as evidenced by the much talked about millionaire migration. Multiple reports have also confirmed that HNWIs [high net-worth individuals] from various parts of the world have earmarked a substantial budget towards property investments in the UAE,” he concluded.