Nakheel awards $1.36bn in contracts for luxury villas on Palm Jebel Ali

When completed, Palm Jebel Ali will be twice as big as Palm Jumeirah and will feature seven islands and 16 fronds. Photo: Nakheel

Dubai developer Nakheel has awarded three construction contracts worth more than Dh5 billion ($1.36 billion) collectively for ultra-luxury villas on the first six fronds of the Palm Jebel Ali project.

The contracts were given to Ginco General Contracting, Shapoorji Pallonji Mideast and United Engineering Construction Company, the company said in a statement on Wednesday.

The scope of work includes the construction of 723 beach collection and coral collection villas across fronds K, L, M, N, O, and P, as well as the development of infrastructure and public spaces in the area.

The contracts include developing 539 five-and six-bedroom beach collection villas and 184 seven-bedroom coral collection villas, with built-up areas ranging from 8,000 to 15,000 square feet. Along with the construction of the waterfront residences, a network of roads, integrated utilities and landscaping is also under way.

The units are scheduled for completion by late 2026, Nakheel said.

The announcement comes after Nakheel awarded a contract worth Dh810 million in August to complete marine works. The main road connecting the man-made island to Sheikh Zayed Road, the city's main motorway, is also under way.

The development has been recording strong buyer interest, with nearly 700 villas sold out soon after launch last year. Each villa sold for between Dh20 million and Dh50 million, Matthew Green, head of research Mena at Global Commercial Real Estate Services, told The National in August.

Palm Jebel Ali represents the "pinnacle of waterfront living", said Khalid Al Malik, chief executive of Dubai Holding Real Estate, the parent group of Nakheel.

"It is set to contribute significantly to the emirate's economic development, attracting investment and tourism for years to come."

The new master plan for the Palm Jebel Ali development was unveiled by Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, in May last year.

When completed, Palm Jebel Ali will be twice as big as Palm Jumeirah and will feature seven islands and 16 fronds, adding more than 90km of beachfront. It is expected to provide 35,000 families with beachside residences, green spaces and other amenities, as well as 80 hotels and resorts.

The project also marks the beginning of a new growth corridor in the Jebel Ali area, underlining the expansion of the emirate, in line with the Dubai 2040 Urban Master Plan and the Dubai Economic Agenda D33, Nakheel said.

The UAE property market has been booming in recent years on the back of government initiatives, such as the golden visa scheme, as well as overall growth in the country's economy.

The luxury and ultra-luxury segments, in particular, have recorded a sharp rise in prices and investor interest over the past two years.

The emirate recorded 948 sales in the luxury property segment, each valued at Dh15 million or more, during the first five months of 2024, a report by property company Betterhomes found. These high-value transactions were concentrated in areas such as Palm Jumeirah, Mohammed bin Rashid City, Dubai Water Canal, Tilal Al Ghaf and Dubai Hills Estate.

Dubai's luxury prime market also hit a record last year as sales of $10 million-plus homes nearly doubled to $7.6 billion, performing better than London and New York, Knight Frank said in a report earlier this year.

Prices of $10 million-plus homes in Dubai also grew at one of the fastest rates globally at 26 per cent last year, as overseas demand for prime residences in the emirate continues unabated, according to Knight Frank.