RAK Properties targets $816 million in sales for 2024 amid higher demand

Abu Dhabi-listed firm plans to launch four more projects after unveiling a new waterfront development this month

RAK Properties' new project Quattro Del Mar. Photo: RAK Properties

RAK Properties aims to achieve more than Dh3 billion ($816 million) in property sales this year, up 50 per cent compared to 2023, amid the launch of new projects and higher demand from buyers, according to its chief executive.

The Abu Dhabi-listed company plans to launch four new projects this year following the launch of the Quattro Del Mar waterfront development in Ras Al Khaimah last week, with the first building of the project consisting 200 units having been sold out.

It is also targeting 20 per cent annual growth in revenue this year amid a bullish outlook for the property market in the emirate.

“We have growth plans for this year,” Sameh Al Muhtadi told The National in an interview. "In terms of revenue, we are targeting at least 20 per cent growth and now we are hoping that we will do much better than that."

The company has yet to announce its fourth quarter and full-year financial results but the “results are going to be very positive”, he said.

The company reported an 82 per cent annual jump in its third-quarter revenue to nearly Dh174 million, while its profit increased eight times to about Dh17 million.

“There is tremendous demand,” Mr Al Muhtadi said. "We are helped with the positioning of Ras Al Khaimah ... everybody sees the value, everybody sees the future of hospitality and services and the growth that RAK is witnessing. We expect that to continue.

“Judging from what we saw in our launch of Quattro Del Mar, we are very optimistic that the appetite is still there.”

The UAE property market continues to rebound strongly on the back of government initiatives and overall growth in the economy amid booming non-oil sector expansion.

Dubai as well as Abu Dhabi recorded strong property sales last year and market prices are expected to continue to rise this year.

RAK Properties, the developer behind the Dh10 billion Mina Al Arab master development off the coast of Ras Al Khaimah, also plans to launch a new hospitality project this year, which “will be a luxury beach resort with brand new residences along with that”, Mr Al Muhtadi said.

The company has "no issues whatsoever in financing new projects", he said.

"Our leverage ratio is extremely low compared to others in the industry, we have our own facilities and the off-plan sales obviously help, especially when we progress projects at the speed that we are."

The company is also going through the "exercise of industry rating in preparation for potential bonds if we need to, but with interest rates, the way they are now, it's not the best approach in funding", Mr Al Muhtadi added.

"We expect interest rates to begin to reduce in the third quarter of 2024. We will be depending mostly on our own funding of projects and off-plan sales."

The developer sold more than 2,000 units last year to buyers from 42 countries, including Russia, the CIS (Commonwealth of Independent States) countries, China, Germany and the UK.

UAE citizens, however, comprised the largest proportion of buyers of its properties, followed by Russians and Germans, according to Mr Al Muhtadi.

“We expect the demand to continue, based on two factors … yield on investments and value growth in the property prices. We are seeing a good 7 per cent to 8 per cent yield on investments from the rental and there's very good value to be had in investments."

Other developers are also boosting their investments in Ras Al Khaimah as the emirate continues to attract tourists and property buyers.

In 2022, Aldar Properties, Abu Dhabi’s biggest developer, acquired a beachfront plot to build its first residential community in the emirate as it continues to expand into other markets.

It also bought two hotels as well as a shopping mall in the emirate.

UAE property company The Luxe Developers also launched a Dh1.5 billion waterfront residential complex in Ras Al Khaimah amid a boom in the Emirates' property sector.

The 18-storey building on Al Marjan Island comprises 206 units of one, two, three and four-bedroom apartments, as well as six penthouses and two exclusive sky villas, the company said in July.

Dubai-listed Dubai Investments is also building a Dh1 billion residential development in Ras Al Khaimah.

“We expect continued growth and we expect continued interest from international investors,” Mr Al Muhtadi said. "I think the Wynn Resorts is a catalyst for a lot of this, with the number of rooms they will have, number of employees and number of visitors."

Wynn Resorts, which is being developed by the Las Vegas-based hotel operator, is set to open in 2026. The 1,000-room property, with entertainment and gaming amenities, is expected to boost the tourism potential of the emirate and create thousands of new jobs.

Ras Al Khaimah recorded its best tourism year yet in 2023, with 1.22 million tourists, up 8 per cent on 2022 and recording a 24 per cent annual growth in international visitors, according to Ras Al Khaimah Tourism Development Authority's latest data.