Specific Benefits – Wide Audience
Shift to the Middle
-
Creating new family-centric attractions like theme- and water parks
-
Visa-on-arrival for Chinese and Russians
-
Strengthening its profile as a destination for medical tourism
-
Substantial marketing efforts in the growth markets China, India and Russia
-
Offering 48 hour visa for stop-over travelers.
Revenue Calculation
Equity Investment | |||||||
Year | Investment | Revenues gross | Costs | Revenues net | Debt Service | Distribution (AED) | Distribution in % |
1 |
937.250 AED |
187.755 AED |
78.989 AED |
108.766 AED |
0 AED |
108.766 AED |
11,60% |
2 |
187.755 AED |
78.989 AED |
108.766 AED |
0 AED |
108.766 AED |
11,60% |
|
3 |
187.755 AED |
78.989 AED |
108.766 AED |
0 AED |
108.766 AED |
11,60% |
|
4 |
187.755 AED |
78.989 AED |
108.766 AED |
0 AED |
108.766 AED |
11,60% |
|
5 |
187.755 AED |
78.989 AED |
958.766 AED |
0 AED |
958.766 AED |
102,30% |
|
Total: |
148,71% |
||||||
Mortgage Investment | |||||||
Year | Investment | Revenues gross | Costs | Revenues net | Debt Service | Distribution (AED) | Distribution in % |
1 |
313.363 AED |
187.755 AED |
78.989 AED |
108.766 AED |
55.414 AED |
53.352 AED |
17,03% |
2 |
187.755 AED |
78.989 AED |
108.766 AED |
55.414 AED |
53.352 AED |
17,03% |
|
3 |
187.755 AED |
78.989 AED |
108.766 AED |
57.708 AED |
51.058 AED |
16,29% |
|
4 |
187.755 AED |
78.989 AED |
108.766 AED |
57.708 AED |
51.058 AED |
16,29% |
|
5 |
187.755 AED |
78.989 AED |
108.766 AED |
57.708 AED |
429.827 AED |
137,17% |
|
Total: |
203,80% |
It is noteworthy that mortgage financing generally is widely available for overseas investors. However, with the UAE Dirham pegged to the US-Dollar, higher interest rates (i.e. compared to eurozone levels) and shorter fixed interest rate periods are the norm and should thus be taken into account.
Roundup
The combination of Dubai`s booming tourism industry with the presently moderate property asset pricing could be a winning one, especially if Dubai`s efforts to strengthen its position as a tourist destination bear fruit.
Crucial for successful implementation of this strategy are the choice of a highly attractive property in a suitable location as well as the competent operators. Finally, the availability of competent marketers, effectively leveraging the power and reach of AirBnB & Co, is imperative.
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The author advises institutional investors about property transactions and handles property portfolios in Dubai since the year 2007. Should you have comments or inquiries, please contact the author on author@property-blog-dubai.com.