Cityland plans Dh1.1bn mall near Global Village around 'nucleus' of botanical garden

Cityland Group is to build a 1.6 million square feet mall complex next to Dubai’s Global Village.

The shopping centre will be a circular complex with 1.13 million square feet of leasable space and a 200,000 sq ft botan­ical garden at its centre, to be known as Central Park. This will include a mini-version of the group’s existing Miracle Garden attraction, an ancient tree garden, a Japanese Garden and a 360-degree rooftop garden flanked by cafes and restaurants.

The single-level building will also be flanked by shaded parking for up to 6,000 cars.

Fahimuddin Sharfuddin, Cityland’s chief executive, said that work is expected to start on the project next month and construction work is due to complete in less than 18 months, by March 2018. The mall is due to open shortly after that, during the second quarter of 2018.

The mall has been designed by MBA, the practice that created Abu Dhabi’s Sheikh Zayed Grand Mosque, and a contract was signed last month with China National Aero Technology International Engineering Corporation to build it.

JLL has been appointed as project manager, while McArthur & Co is advising on lettings and will manage the completed mall.

The mall will have 350 stores built around six continent-themed pavilions. About 48 per cent of the space will be taken by fashion retailers, 27 per cent by non-fashion, 15 per cent by food and beverage outlets and 10 per cent by entertainment facilities.

Mr Sharfuddin said agreements are already in place with operators for 20 per cent of the leasable space available, including an operator for the 100,000 sq ft hypermarket, the family entertainment centre and a cinema complex with up to 14 screens.

Announcements about the operators for these will be made in the coming weeks, he said.

Mr Sharfuddin said that the project will be funded by a mix of debt and equity, and that a deal is currently being finalised with two banks – one local and one regional – to provide project funding.

Phil McArthur, the managing director of retail consultancy McArthur + Company, said that the centre’s target catchment area was the 200,000 residents living along the Sheikh Mohammed bin Zayed Road corridor who often have to travel up to 30 minutes inland to reach a suit­able shopping centre.

However, Cityland Mall is also likely to face much more competition – not only from Majid Al Futtaim’s proposed 650,000 to 860,000 sq ft regional mall at its new community next to Global Village, but also from Dubai Holding’s Mall of the World – the Dh40 billion retail-led complex that was shifted to the same corridor in September.

Mr Fahimuddin said that he was not too concerned with the prospect of having Mall of the World as a neighbour.

“When this will happen, no one knows. Where it will happen, no one knows. We are talking about delivering the mall within 20-24 months maximum. I am only focusing on my mall being operational in 2018. I have very strong interest from retailers – we have first commitments of over 20 per cent so far without breaking ground. That gives us a lot of confidence.”

Mr McArthur said: “Of course, we have to pay attention to competition, but the competition we’re looking at today is the real competition that exists on the ground. Future projects will come along, but we’ll make sure that our project is well run and well marketed to maintain our market share.”

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New bankruptcy law will draw investment, says DIFC Courts chief

The UAE’s new bankruptcy law will make a “massive” difference to the country’s ability to attract inward investment, according to Mark Beer, the chief executive of DIFC Courts.

Mr Beer said that the new law gives investors greater clarity over the potential downside risks of investment.

Sheikh Khalifa, the President, on Monday issued the long-awaited new federal bankruptcy law by decree.

Speaking on the sidelines of the Dubai Investment Forum on Tuesday, Mr Beer said:

“If a business has a problem it can come to a court such as DIFC Courts and get speedy resolution, but if it the debtor simply can’t pay its debts, the new insolvency law provides a system that protects jobs, gives certainty and maximises creditor returns.

“When you look at the downside [risk] of investment it includes the risk of bankruptcy. Leading economies provide a regime that allows a business in crisis time to work through its issues and seek new sources of funds, while allowing creditors the certainty of an orderly restructuring.”

He argued that once investors know the scale of returns likely as a result of a business failure, the case to invest becomes much stronger.

“I’m sure that this new law will be a significant catalyst for further investment,” he said.

Mauricio Zuazua, a partner with management consultancy firm AT Kearney, argued that the new law would also encourage greater levels of investment from foreign SMEs.

“The publication of that law is of tremendous impact precisely because the risk of doing business remains with the business. It’s not a personal liability.

“While large corporations may want to take that risk and make measured investments, the small and medium-sized enterprise – the entrepreneur – cannot take that risk. All of the liability becomes his or hers. The law is going to change the ability of the country [in] attracting entrepreneurs, and developing and nurturing the networks needed for entrepreneurs to flourish.”

During the forum, Sami Al ­Qamzi, the director-general of the Dubai Government’s Department for Economic Development, announced the launch of a new International Sustainable Investment Centre aimed at building a regional network for sustainable investment in the Mena region.

Mr Al Qamzi said that Dubai had attracted Dh17.7 billion worth of foreign direct investment (FDI) in the first six months of 2016, compared with Dh28.6bn for the whole of 2015. Last year, the city ranked sixth globally in terms of the amount of FDI attracted, and fourth globally in terms of the number of new investment projects. It brought 279 new projects to market in 2015 – a 16 per cent increase on the previous year.

“Dubai continues to cement its position among the top FDI destinations in the world,” said Mr Al Qamzi. Mr Beer said that the UAE overall currently attracts 60 per cent of the FDI into the ­wider Gulf region, and 50 per cent of FDI-related jobs.

“What’s left to play for is US$1.7 trillion of money which is circling the globe looking for a home. We don’t want to capture $1.7tn. We want to capture a proportion of that that adds value.

“There’s two types of FDI. There’s vulture FDI that circles the world and looks for a carcass. It adds no value, no jobs and no intellectual property. It eats the flesh off the carcass and at the first sign of trouble it leaves.

“What we want is the positive FDI that creates wealth and opportunity, that creates jobs [and] adds value.”

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Dubai's developers squeeze prices and apartment sizes to stoke investor demand

The average ticket price for properties in Dubai may be coming down, but so is the space on offer inside many of them.

Executives at Dubai South feted the launch of phase one of The Pulse on October 1, whose cheapest units were advertised at Dh280,000 – considerably lower than prices in other parts of the city.

Even Danube Properties, whose founder Rizwan Sajan was passing on savings by supplying goods from his building materials business at cost, was charging Dh430,000 for its cheapest studios at its Starz development in Al Furjan.

So how did Dubai South achieve such a feat at its first residential project as master developer?

The number of units on sale at that headline price was only a fraction of the total on offer. One broker last week said that 10 units went on offer at the lowest rate, out of about 300. Both of these figures were referred to Dubai South, but it did not respond to a request for comment.

The main factor in Dubai South’s favour is likely to be the cost of land, which is cheaper in less prime, inland locations such as its site. However, smaller unit sizes also played a part. Listings for the Dh280,000 studios show a built-up area of 400 square feet.

Craig Plumb, the head of research at JLL Mena, said that alongside Dubai South, developers were looking at areas in Dubailand, Jebel Ali and Al Qudra Road as locations for cheaper units.

“The one thing these areas have in common is that they are distant from the central business district and land prices are cheaper.”

According to the broker Cavendish Maxwell, of the 5,579 units completed in the third quarter of 2016, 81 per cent were apartments and the bulk of these were built in inland locations – the top three destinations were Dubailand, Dubai Silicon Oasis and Jumeirah Village Circle.

Research carried out by JLL last year set the benchmark for affordable homes at Dh780,000 for a two-bed unit.

“Less than 20 per cent of all launches were below this price point in 2015,” said Mr Plumb. “While there is no data for launches in 2016, this percentage would certainly have increased. This is being achieved by producing smaller units and by either paying less for the land or by structuring the payment terms for land over an extended period.”

Select Group is one developer that has opted to go down the route of offering smaller units. When it launched its Residences at Marina Gate project in Dubai Marina two years ago, prices started at Dh1.3 million for a one-bedroom apartment.

This week, its Studio One project offered studio apartments in Dubai Marina from Dh574,000 and one-bedroom units from Dh899,000.

“It just depends on the size,” said Rahail Aslam, the chief executive of Select Group. “We’ve designed very efficient sizes in this project, so that helps prices to be a little bit more affordable.”

For instance, existing one-bedroom apartments the company has built in the Marina range in size from 600 to 900 sq ft. The studios in its new development start at 360 sq ft.

About 80 per cent of the units in Studio One are either studios or one-bedroom apartments, and 65 per cent were pre-sold before the launch.

“The buyer profile for the stock that we have sold so far has been a lot of investors that like rental yield,” said Mr Aslam.

At the recent launch of SRG Holding’s Marquise Square development in Business Bay – 62 per cent of which (237 out of 384) were studio apartments – Adam Price, the managing director of the master sales agent Select Property Group, said that when compared with typical rents in the area, its (slightly larger) studios offer yields of about 9 per cent.

The average investment yield for Dubai apartments was 7.5 per cent in the third quarter, according to Cavendish Maxwell.

Matthew Green, the UAE head of research and consultancy for CBRE Mena, said that the smaller ticket prices prove popular with investors, even though they equate to approximately the same price per square foot.

“From an investor point of view, it’s fantastic because you have a small unit at a lower price so you can let it out easily. But I don’t think it’s a strategy that’s entirely linked into the psyche of the end-user.”

However, the yields being quoted to investors may be more difficult to achieve as the supply pipeline increases. CBRE’s second-quarter report on the Dubai market, predicted that about 48,000 new homes are due to be delivered by the end of 2018, with the bulk of these being in Dubailand, Jumeirah Village, Business Bay and Dubai Silicon Oasis.

Moreover, the yield comparisons being made are with existing units, which tend to be much larger.

Mr Green said that occupiers, whether buyers or renters, are accustomed to much bigger unit sizes in Dubai.

“You can make room sizes smaller and more liveable, but I think it’s something developers need to be slightly careful with, because in a couple of years’ time people might start to suddenly say ‘Well, I would rather be with this developer because they still offer the size of unit I have become accustomed to’.”

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Dubai apartments are becoming affordable but smaller

The average ticket price for properties in Dubai may be coming down, but so is the space on offer inside many of them.

Executives at Dubai South feted the launch of phase one of The Pulse on October 1, whose cheapest units were advertised at Dh280,000 – considerably lower than prices in other parts of the city.

Even Danube Properties, whose founder Rizwan Sajan was passing on savings by supplying goods from his building materials business at cost, was charging Dh430,000 for its cheapest studios at its Starz development in Al Furjan.

So how did Dubai South achieve such a feat at its first residential project as master developer?

The number of units on sale at that headline price was only a fraction of the total on offer. One broker last week said that 10 units went on offer at the lowest rate, out of about 300. Both of these figures were referred to Dubai South, but it did not respond to a request for comment.

The main factor in Dubai South’s favour is likely to be the cost of land, which is cheaper in less prime, inland locations such as its site. However, smaller unit sizes also played a part. Listings for the Dh280,000 studios show a built-up area of 400 square feet.

Craig Plumb, the head of research at JLL Mena, said that alongside Dubai South, developers were looking at areas in Dubailand, Jebel Ali and Al Qudra Road as locations for cheaper units.

“The one thing these areas have in common is that they are distant from the central business district and land prices are cheaper.”

According to the broker Cavendish Maxwell, of the 5,579 units completed in the third quarter of 2016, 81 per cent were apartments and the bulk of these were built in inland locations – the top three destinations were Dubailand, Dubai Silicon Oasis and Jumeirah Village Circle.

Research carried out by JLL last year set the benchmark for affordable homes at Dh780,000 for a two-bed unit.

“Less than 20 per cent of all launches were below this price point in 2015,” said Mr Plumb. “While there is no data for launches in 2016, this percentage would certainly have increased. This is being achieved by producing smaller units and by either paying less for the land or by structuring the payment terms for land over an extended period.”

Select Group is one developer that has opted to go down the route of offering smaller units. When it launched its Residences at Marina Gate project in Dubai Marina two years ago, prices started at Dh1.3 million for a one-bedroom apartment.

This week, its Studio One project offered studio apartments in Dubai Marina from Dh574,000 and one-bedroom units from Dh899,000.

“It just depends on the size,” said Rahail Aslam, the chief executive of Select Group. “We’ve designed very efficient sizes in this project, so that helps prices to be a little bit more affordable.”

For instance, existing one-bedroom apartments the company has built in the Marina range in size from 600 to 900 sq ft. The studios in its new development start at 360 sq ft.

About 80 per cent of the units in Studio One are either studios or one-bedroom apartments, and 65 per cent were pre-sold before the launch.

“The buyer profile for the stock that we have sold so far has been a lot of investors that like rental yield,” said Mr Aslam.

At the recent launch of SRG Holding’s Marquise Square development in Business Bay – 62 per cent of which (237 out of 384) were studio apartments – Adam Price, the managing director of the master sales agent Select Property Group, said that when compared with typical rents in the area, its (slightly larger) studios offer yields of about 9 per cent.

The average investment yield for Dubai apartments was 7.5 per cent in the third quarter, according to Cavendish Maxwell.

Matthew Green, the UAE head of research and consultancy for CBRE Mena, said that the smaller ticket prices prove popular with investors, even though they equate to approximately the same price per square foot.

“From an investor point of view, it’s fantastic because you have a small unit at a lower price so you can let it out easily. But I don’t think it’s a strategy that’s entirely linked into the psyche of the end-user.”

However, the yields being quoted to investors may be more difficult to achieve as the supply pipeline increases. CBRE’s second-quarter report on the Dubai market, predicted that about 48,000 new homes are due to be delivered by the end of 2018, with the bulk of these being in Dubailand, Jumeirah Village, Business Bay and Dubai Silicon Oasis.

Moreover, the yield comparisons being made are with existing units, which tend to be much larger.

Mr Green said that occupiers, whether buyers or renters, are accustomed to much bigger unit sizes in Dubai.

“You can make room sizes smaller and more liveable, but I think it’s something developers need to be slightly careful with, because in a couple of years’ time people might start to suddenly say ‘Well, I would rather be with this developer because they still offer the size of unit I have become accustomed to’.”

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The trend by developers to build ever-greater numbers of small studio units in apartment buildings is understandable, but a little depressing.

First, the understandable part.

Alongside the need to appeal to investors’ appetite for maximum possible returns, there are a few differences in the local market which broaden studios’ appeal here when compared to other parts of the world.

Firstly, there is the fact that couples who are unmarried are not permitted to cohabit under UAE law (although there are many who run the risk of arrest for affordability reasons). Secondly, the large salary and benefits packages that were once offered have been reined in as the global workforce has become more mobile, meaning that increasing numbers of the local workforce are not families, but younger single people.

A study published last month by Dubizzle found that millennials (people born between 1980 and 2000) make up the greatest proportion of Dubai’s population. The Dubai Statistics Centre states that the median age of Dubai residents is between 30 and 34, with one-fifth (500,000 out of 2.5 million) of the population falling within that bracket. Extrapolating these results to cover the entire millennial range, Dubizzle estimates that 49 per cent of Dubai’s inhabitants are millennials.

This is part of a worldwide demographic pattern that could reshape building trends, according to the Canadian-headquartered consulting giant WSP Parsons Brinckerhoff. It argues that the changes could be most notable in high-rise buildings, which are becoming increasingly important as urbanisation rates grow.

Research in the US by the Brookings Institution found that the proportion of jobs located in US city centres dropped from 63 per cent in 1960 to 16 per cent in 1996 – but has been growing ever since. City centre-based jobs grew by 0.5 per cent per year from 2007-2011, compared with an annual decline of 0.1 per cent outside of cities.

As well as being city dwellers, millennials are also said to have different priorities to older groups, favouring experiences over ownership. WSP Parsons Brinckerhoff points out this is partly through necessity as the prospects of home ownership remain remote for many (this is the depressing part).

Overall, it argues, millennials will demand more from the spaces they occupy, prizing quality of life and ease of access to shops, entertainment and places to spend time with friends. They want to live in urban areas that are walkable and well-connected.

Given that tall towers are expensive to build and maintain, it said that designers need to give serious thought to creating “high-rise communities” to make sure they remain viable – especially as increasing numbers of people live alone.

When asked how such trends are relevant to Dubai, with its high proportion of both towers and millennials, the firm’s director of building structures for the Middle East, Brian Hillesdon, said that the fact that so many people here are renters means that developers perhaps need to consider millennials’ requirements more closely than elsewhere. The city’s transient population means people are not tied down to spaces, and if buildings don’t work very well or don’t provide the right facilities, people will move somewhere that will.

“Size is perhaps becoming less of an issue, but location and facilities are still key to letting a property,” he said.

He delivered a talk about eight years ago in which he argued that, at the time, Dubai’s tall buildings were typically single-use – an office or residential tower – with little human scale and few facilities. Often they didn’t even have pavements.

Since then, he says, there has been a push to create more enjoyable places to live and work, and that newer high-rises are generally of a better quality. He also says that a greater emphasis is placed on community in master planning and on places for residents and tourists to socialise.

“Fifteen years ago, there were very few areas with a community feel – Diyafa Street, Satwa and Deira being key examples,” he said.

Now he cites Downtown, DIFC, Boxpark, City Walk and The Beach at JBR as just a few examples of places which offer that social experience.

Within buildings, common areas such as pools, gyms and food and retail areas become increasingly important if people end up living alone in smaller studio apartments, he says. Larger developments need common areas or spaces that offer a “user experience”, he said.

“If they satisfy these criteria, [buildings] will sell, or rent, making both tenant and owner mutually happy.

“Likewise, older, out-of-date, low-cost, low-quality buildings with minimal facilities and little community spirit will be the second choice for millennials – commanding much lower returns for owners.”

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A Dh47m home in the New York district that went from hippie hangout to millionaire's playground

For those of us who aren’t lucky enough to have lived in New York City, a first visit to the US’s financial (and probably its cultural) capital is often a source of wonder. Its streets have been used so often in films and in TV shows that everywhere you go seems familiar, from the downtown skyscrapers to Central Park and even the subway trains.

Greenwich Village and its large brownstone buildings are a great example of this, with many building exteriors being used as the backdrop for famous city shows such as Friends and Sex and the City. The proximity of “The Village” to New York University means it has been home to writers, artists and other creative types for most of the past century, especially in the counterculture era during the late 1960s.

But in recent years home prices have skyrocketed in the area and now rank among Manhattan’s most expensive. One property on the market, at 110 West 13th Street for $12.95m (Dh47.6m), gives some indication as to why these homes are so appealing.

Originally built in 1844 (but comprehensively renovated over the past two years), it provides the typical high ceilings and large windows expected of a property of this era, with the current owners making the most of the space by hanging curated artworks from its walls.

Once up the stone front steps, the house opens into a foyer and its feature open-plan mezzanine parlour floor. This contains an original ornate fireplace and a lounge area. The ground floor houses the main living and entertainment space, including a dining area and a chef’s kitchen with black marble tops, a Wolf double cooker and preparation hotplates. Next to the kitchen is a media room with high-beamed ceilings and windows overlooking a private garden.

The property’s five bedrooms are split between the second and third floors. The second floor contains the master bedroom with an en suite bathroom, the third floor has more bedrooms and a terrace, and the top of the building has a roof terrace offering views of the Manhattan skyline. Furthermore, 110 West 13th St is just a couple of minutes’ walk from Fifth Avenue and Avenue of the Americas, and just two blocks west of Union Square.

q&a

Matthew Pravda, a senior real estate adviser at selling agents Leslie J Garfield, explains the appeal of Village life

Who would live in a house like this?

The buyer of this distinguished town house will most likely have a background in the finance sector, or a keen interest in the arts. Featuring five generously-sized bedrooms, the purchaser is likely to have children, extended family, or members of staff living in the house.

What sort of amenities are on offer?

The Village offers some of Manhattan’s best restaurants, shopping and schools in a quaint neighbourhood atmosphere. The proximity and easy access to every area in the city make Greenwich Village one of New York’s most desirable neighbourhoods.

What are the neighbours like?

Most of the people living on this block are creatives, with keen interests in music, drama or the arts. Notable neighbours on the block include musician Sean Lennon, the son of John Lennon, and Academy Award-winning actress Marisa Tomei.

How have property prices ­performed in this neighbourhood over the past few years?

Over the past five years, Greenwich Village has been the most expensive neighbourhood in Manhattan. Single-family town houses sell at an average of US$3,500 per square foot with some transactions eclipsing $5,000 per sq ft.

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UAE residents saving more and borrowing less, says top banker

The country’s credit picture is becoming clearer: people are saving more and borrowing less, says a leading banker.

Demand for new personal loans and vehicle loans has dropped by up to 25 per cent year-on-year, said Suvo Sarkar, Emirates NBD’s head of retail banking and wealth management.

In an interview with The National, Mr Sarkar said: “We’re seeing a slowdown in demand for loans – whether it’s personal loans or auto loans, there’s definitely a slowdown.

“I think people are consuming less – whether it’s buying a car or buying anything for the house. That’s a reality and I think all banks are getting adjusted to the new numbers. Total loan offtake every month has definitely dropped off, I would say, by a factor of 20 to 25 per cent.”

Mr Sarkar said that falling demand explained part of the decline but the introduction of the UAE Credit Bureau about 12 months ago had also played its part.

“We started using it on day one – we were one of the anchor participants.

“Clearly, there are fewer loans being underwritten by the industry because of the credit bureau being there. That’s a good thing – [people] are not borrowing for the wrong reasons or the wrong circumstances.”

In July, the Central Bank said that lenders were more hesitant about issuing credit to both individuals and businesses in the second quarter compared with the first three months of the year. Mr Sarkar said demand for mortgages had also declined as a result of the weaker housing market but argued that elsewhere signs were more positive.

He said balances in customer’s current and savings accounts had increased by between 10 and 11 per cent, which, he said, “helps the liquidity situation for us and for the entire country”.

“Even the wealth management – insurance and investment – business is still growing at a very healthy pace. Customers are still planning for the future.”

He said that the personal banking side of the business had only been marginally affected by increasing liabilities being racked up by the increasing number of non-performing loans linked to SME customers, but he welcomed the anticipated introduction of a bankruptcy law.

“We’ll see the positive effects of that within the next six to 12 months. Hopefully, the credit bureau and the bankruptcy law put together should give the industry a lower provision rate going forward.”

A report published by NBAD Securities earlier this week predicted that aggregate net profit across the 13 banks it tracks for the third quarter is likely to be 1.9 per cent lower year-on-year.

However, Emirates NBD has continued to outperform, increasing its share of the market by almost 1 per cent year-on-year by the end of June. It has a market share of just below 20 per cent, followed by NBAD with 16.3 per cent. However, once the latter’s proposed merger with FG B concludes, its combined share will be 25.66 per cent.

Luke Ellyard, a Dubai-based partner at KPMG, said that he expects more mergers in the sector as trading conditions remain tough.

“Realistically, things are trending downwards and the expectation is that this will continue through 2017. It’s an increasingly competitive market and in all of the meetings we have there is still a lot of talk about consolidation. I think that will help on a number of fronts.”

For example, he said that merged banks would benefit from improved liquidity ratios, allowing them to lend more to certain sectors, as well as lowering overheads and costs of raising capital.

“We’re continuing to see a focus on costs,” he said.

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'Bank in your car' could be just two years away, says Emirates NBD

A partnership between Emirates NBD and Visa Connect could result in your self-driving car driving you directly to an ATM that automatically dispenses cash or to a takeaway that will hand you pizza that has been paid for, according to a bank official.

The in-car banking system is one of a number of new technologies being shown within the Emirates NBD Future Lab at Emirates Towers in Dubai, alongside the bank’s robot assistant, Pepper, a virtual reality shopping service and a voice banking service based on the new Amazon Echo device.

Suvo Sarkar, Emirates NBD’s group head of retail banking and wealth management, said that cars can already communicate directly with service depots and call centres run by their manufacturers, but with new technology including biometric security, a driverless car could take you immediately to an ATM that will dispense cash as you pull up to it, or to a participating store that could have goods waiting for you.

“What we will be able to do tomorrow is have your bank in your car, or your RTA in your car. It will guide you to the nearest parking available and charge you for the number of hours you spend in the parking lot.

“We think it’s less than two years away,” said Mr Sarkar. “It’s not horribly complex and the fact that all Dubai government entities are moving so quickly into the future … I think API [Application Programming Interface – a way of getting different software programs to talk to each other] integration will not be hugely difficult.”

Emirates Towers was chosen as the location for Emirates NBD’s new branch because Dubai Future Foundation’s offices are just a few hundred metres away on the opposite side of a first-floor balcony.

“You see in that area what the future holds for transportation, policing, etc. In this area, you will see what the future holds for banking,” said Mr Sarkar.

The new branch contains three elements. One is a traditional banking zone with advisers, another is a digital zone with ATMs and ITMS – the Interactive Teller Machines with video links first trialled by Emirates NBD two years ago – and the third is the future lab.

Mr Sarkar believes that voice-activated banking – using a voice-controlled speaker like Amazon Echo to make payments and transfer funds – is another technology that can be delivered quickly.

“I would think about 12-18 months,” he said. “We’re already working on voice biometrics where you can talk to [an automated service] and instead of punching keys, you speak to it and it will know what you are talking about.”

For instance, he said that instead of going through a series of menus at its call centre, it will immediately recognise voice commands requesting balances or payments. The service is being tested to cope with the many different languages and accents spoken in the UAE, but could be delivered by the first quarter of 2017.

This will help with an ongoing trend to migrate customers to easier-to-use (and more profitable) non-branch services. Mr Sarkar said that 90 per cent of its transactions are already carried out outside traditional branches – either through call centres, ATMs/CDMs, mobiles or online.

This is changing the nature of its physical banking network, which is still growing, but at a much slower pace.

“We are adding on three to four branches a year now, as opposed to eight to 12 in previous years,” said Mr Sarkar.

New branches also have much smaller “transaction-centric” areas like bank teller windows, and a branch is “typically half” the size of a traditional, 6,000 square feet branch, he said.

Matthew Green, the UAE head of research at CBRE Mena, said banks are continually reviewing their property requirements.

“I think, particularly at the moment, given the downsizing we have seen across the banking sector, optimisation is a strategy they are looking to implement.

For instance, he said mall branches are an issue owing to the affordability of space.

“Dubai Mall, Mall of the Emirates and all of the major malls … obviously every bank wants to have a location there because of the huge footfall, but banks don’t want pay the type of rents that the major malls are asking – and can probably get – from other tenants.”

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The cash flow crisis that has engulfed Saudi Arabia’s biggest builder, Saudi Binladin Group, has started to ease with much-needed payments from the kingdom’s finance ministry filtering through.

The Wall Street Journal had reported that payments of between US$800 million (Dh2.9 billion) to $1.1bn had been made to the company in September.

A spokesman confirmed to The National that payments had been made, but did not disclose the amount.

The spokesman said that the ministry “had begun releasing some of the due payments to the group in relation to currently executed projects owned by numerous government entities”.

He said that the move would strengthen the group and its “commitment to successfully complete all undertaken projects, as we have done since our inception”.

“We remain focused to continue our contributions to the development of Saudi Arabia and determined to overcome all odds, though temporary.”

The spokesman added that it is working with clients on delayed projects so that “any changes to the originally set schedules are jointly worked out”.

However, its delivery of future work will be curtailed by the fact that it has had to lay off so many staff during the course of the year as a result of its constrained finances.

The company said that about 80,000 workers had been released as part of its restructuring, but said that all of them have been paid all of the salaries and other service benefits they were owed.

The plight of workers for many of Saudi Arabia’s construction workers has come into sharp focus over the past few months as payment delays have got longer and longer, forcing a number of foreign governments to take action to ensure their own nationals were provided for.

India’s government began shipping food into the kingdom in August to feed workers from Saudi Oger who had reportedly gone for seven months without pay, while last month the Philippines government’s Overseas Workers Welfare Administration began distributing payments both to families of workers stranded in Saudi Arabia and those who had been repatriated without pay.

The OWWA’s payments were distributed to those who had been working for nine struggling Saudi contractors, including Saudi Binladin, Saudi Oger and Mohammed Al Mojil Group.

A report from Reuters last month stated that Saudi Oger, a company controlled by Lebanon’s Hariri family, is owed about 30bn Saudi riyals from the government for work it has undertaken, although it in turn owes 15bn riyals to its banks and several billions more to workers and suppliers.

Saudi Oger did not respond to requests for comment.

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Select Group sells 65 per cent of new Marina project ahead of launch

The Dubai developer Select Group has pre-sold about 65 per cent of its latest Dubai Marina project ahead of its launch.

Select Group announced the launch of Studio One – a Dh450 million, 31-storey tower in Dubai Marina – on Monday, but Rahail Aslam, the company’s founder and chief executive, said that most of the building has been sold to existing investors within the past two days.

“We’ve got a large database of customers who primarily buy Dubai Marina product. We’ve gone to the database and to our preferred agent network on Saturday, and we’ve done 65 per cent sales within 48 hours,” he said. “We’ve had an astounding response.”

Almost 80 per cent (316 out of 400) of the units within the building are either studios or one-bedroom properties, with the studios starting at Dh574,000 for units of 360 square feet. One-bedroom units are selling from Dh899,000 and the remaining 84 two-bedroom properties start from Dh1,349,000. Amenities include a gym, steam room, sauna rooms, ground floor retail and parking.

The building will be on a site on the western side of the Mar­ina, next to the Wyndham Dubai Marina and the New Rove Hotel.

National Engineering Bureau has been appointed as the archi­tect and enabling works are already under way.

Mr Aslam said that he expects a tender for the main contract works to be issued by November, and for a contractor to be in place to build the tower by the end of the year. The completion date for Studio One is December 2018.

Mr Aslam said that Select Group is also in talks to buy another couple of plots within ­Dubai Marina.

“Our focus has always been the Marina and we are still looking around in the same master development. We are also looking to explore other master developments where infrastructure is broadly complete,” he said.

mfahy@thenational.ae

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