RAK property sector enjoys robust growth

Key points Ras al-Khaimah real estate is enjoying a period of robust growth on the back of supporting infrastructure, complementary policies, and a diversified economy More than AED4bn-worth of land and property transactions were recorded in the first half of 2022, a 45 per cent year-on-year increase High-profile investments by firms such as Wynn Resorts, Aldar Properties, Dubai Investments and Abu Dhabi National Hotels mark a new phase of development The ‘nature emirate’ is steadily bulking up its tourism and hospitality segments Sustainability is the centrepiece of the emirate’s long-term tourism strategy

Ras al-Khaimah’s land and properties sector recorded a 45 per cent rise in transactions to AED4bn ($1.1bn) in the first half of 2022 compared to the same period last year, on the back of multibillion-dollar investment deals, including the Wynn integrated resort on Al-Marjan island.

According to data from the Ras al-Khaimah Municipality, the demand for commercial units, commercial and residential lands, and touristic lands increased sharply in the first half of 2022, indicating a growing appetite for commercial real estate activity in the emirate.

Increasing investments

Running parallel to this growth is a rise in large-scale investments by local and international hospitality players, first marked by US-based Wynn Resorts’ announcement of its plans to build a multibillion-dollar integrated resort in the emirate in January 2022, which coincided with Ras al-Khaimah Tourism Development Authority’s (Raktda’s) introduction of a gaming regulation department.

Following this, a series of strategic hospitality and retail asset acquisitions were made by Abu Dhabi’s Aldar Properties, including the Rixos Bab Al-Bahr hotel, the Al-Hamra Mall and the Doubletree by Hilton Resort & Spa Marjan Island.

More recently, listed firms Abu Dhabi National Hotels and Dubai Investments have made separate announcements detailing AED1bn-worth of resort and residential projects on Al-Marjan.

These deals indicate the crucial role the emirate’s tourism and leisure sector is set to play on a regional and international level, according to Cyril Lincoln, executive vice-president and global head of real estate finance and advisory at UAE-based Mashreq Bank.

“The real estate and tourism market in Ras al-Khaimah is going from strength to strength owing to a combination of several factors including supporting infrastructure and regulations, and its robust, diversified economy,” says Lincoln.

“The numbers are telling of a healthy property market. But even more exciting is that regional and international investors are beginning to sit up and take notice of the investment opportunities in Ras al-Khaimah; many have already made a move.

“A lot of this is happening because of steps taken in recent years, pre- and post-pandemic. Ras al-Khaimah is shaping its real estate landscape slowly but steadily by locking the fundamentals in place.”

 Ras al-Khaimah pursues sustainable tourism

Lincoln adds that the low base effect of real estate in the emirate makes the growing scale of transactions look even more impactful. Working in the emirate’s benefit is its relatively smaller geographical size, which allows authorities to control more of the activity on the ground and readapt as required.

Over the years, synergistic efforts between the real estate and tourism sectors have seen the emirate carve out a unique value proposition in the UAE – a destination located less than an hour away from one of the world’s most significant business hubs, which is also a viable option for business and inward investment.

“I fully expect the growth in Ras al-Khaimah to explode in the coming years, given that it is learning and adapting best practices from its neighbours, including Dubai and Abu Dhabi,” says Lincoln. “Financiers are closely watching the market and are keen to support this exciting new phase.”