Rail Link Expansion: A Game-changer for Real Estate Industry

Dubai Metro and Etihad Rail network expansion set to benefit the UAE real estate and hospitality

By Muzaffar Rizvi

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The Etihad Rail will significantly enhance the investment potential in both Abu Dhabi and Ras Al Khaimah by facilitating seamless travel between these emirates and Dubai.
The Etihad Rail will significantly enhance the investment potential in both Abu Dhabi and Ras Al Khaimah by facilitating seamless travel between these emirates and Dubai.

Published: Fri 1 Dec 2023, 4:44 PM

The expansion of rail links in the UAE is a game-changer for the real estate market and will boost demand for industrial and commercial properties in addition to support the residential housing units supply in coming years, experts say.

Top executives, analysts and real estate officials said the expansion of the Metro and Etihad Rail network is a major catalyst for the UAE’s economic growth and will further stimulate tourism, shopping, entertainment and investment in the country.

Alina Adamco, Head of Sales at Metropolitan Homes, said infrastructure development is crucial for the growth and prosperity of any nation, city, or community, and Dubai is a prime example of this.

Alina Adamco, Head of Sales at Metropolitan Homes, said infrastructure development is crucial for the growth and prosperity of any nation, city, or community, and Dubai is a prime example of this.
Alina Adamco, Head of Sales at Metropolitan Homes, said infrastructure development is crucial for the growth and prosperity of any nation, city, or community, and Dubai is a prime example of this.

“With its rapid expansion, Dubai is continuously expanding its metro network to meet the evolving needs of its residents and visitors. Initially, the red and green metro lines were designed to cover Dubai’s most popular areas. However, many residents and tenants living in areas beyond Sheikh Zayed Road expressed a desire for metro accessibility in their neighbourhoods. This desire is soon to become a reality with the addition of the blue, purple, yellow, and pink lines, which will extend to cover locations like Damac Hills, The Villa Project and Maritime City, among others,” Adamco told BTR.

In gated communities, she said residents currently rely on cars or taxis for transportation.

“The introduction of metro links will significantly boost the value of these communities, as evidenced by a 40 per cent surge in property prices in Dubai Marina. Additionally, rental rates have increased by approximately 10 per cent,” she said.

Last week, Dubai announced a Dh18 billion ($4.9 billion) blue line project to support the existing network of red and green lines by adding 30km by 2029. It is one of the largest new projects in the public transport sector announced in recent years.

The new line will serve population of one million residents, such as Dubai Creek Harbour, Festival City, Global Village, Rashidiya, Warqa, and Mirdif, as well as urban areas like Silicon Oasis, Academic City, and more.

A game-changer

Umar bin Farooq, Chief Executive Officer of real estate agency One Broker Group, said the expansion of the Dubai Metro will extend its reach to previously underserved areas, making them more attractive to potential residents and businesses.
Umar bin Farooq, Chief Executive Officer of real estate agency One Broker Group, said the expansion of the Dubai Metro will extend its reach to previously underserved areas, making them more attractive to potential residents and businesses.

Umar bin Farooq, Chief Executive Officer of real estate agency One Broker Group, said the expansion of the Dubai Metro will extend its reach to previously underserved areas, making them more attractive to potential residents and businesses.

“This will inevitably lead to increased demand for real estate in these areas, driving up property prices. Similarly, Etihad Rail's connection to Dubai and Abu Dhabi will further enhance intercity connectivity, making it easier for people to live, work, and play across these two major hubs. This will also boost demand for real estate along the rail corridor,” Farooq told BTR.

Indeed, he said the expansion of rail links is a game-changer for the UAE real estate market.

“We expect to see a positive impact on the tourism sector since it will be easier for visitors to explore Dubai and the UAE. This will increase demand for hotel and serviced apartment properties,” he said.

Change of minds

The new line will serve population of one million residents, such as Dubai Creek Harbour, Festival City, Global Village, Rashidiya, Warqa, and Mirdif, as well as urban areas like Silicon Oasis, Academic City, and more.
The new line will serve population of one million residents, such as Dubai Creek Harbour, Festival City, Global Village, Rashidiya, Warqa, and Mirdif, as well as urban areas like Silicon Oasis, Academic City, and more.

Adamco said Dubai’s growing European and Asian expatriate population is accustomed to well-developed public transportation systems that enable fast and efficient commuting. Moreover, many individuals prioritise environmental consciousness and would prefer using a metro over a car or taxi, especially if the metro is conveniently located near their homes or workplaces.

“Another significant infrastructure project is the Etihad Rail, a 1,200-kilometer network connecting all seven emirates,” she said.

In recent years, Abu Dhabi has attracted investors seeking cultural experiences and pristine beaches, while Ras Al Khaimah has appealed to investors looking to capitalise on the emirate’s growth through early investment opportunities, she said.

“For both locations, the Etihad Rail represents a significant enhancement to their investment potential, simplifying travel to neighbouring emirates,” she said.

Adamco said the Etihad Rail will significantly enhance the investment potential in both Abu Dhabi and Ras Al Khaimah by facilitating seamless travel between these emirates and Dubai.

“The Etihad Rail will also establish a direct link between the UAE and Saudi Arabia, from Ghuweifat in the west to Fujairah on the east coast, further stimulating tourism, shopping, entertainment and investment, which will have a positive impact on the UAE’s real estate market,” she said.

Growth catalyst

In reply to a question, Farooq said the improved connectivity will also benefit businesses, making it easier for them to transport goods and services across the region.

“It will boost the demand for industrial and commercial real estate. More importantly, this infrastructure expansion underscores the UAE government's commitment to a sustainable and prosperous future.

“As the CEO of One Broker Group, I am confident that the UAE real estate market is poised for continued growth in the years to come. The expansion of the Metro and Etihad Rail is a major catalyst for this growth, and we are excited to be a part of this dynamic and exciting sector,” Farooq said.

To a question about growth in price valuation of Dubai real estate due to expansion of Metro and Etihad Rail’s network and services, he said real estate sector will be among the major beneficiaries of two mega projects in the UAE.

Loai Al Fakir, CEO of Provident Real Estate, said the Dubai Metro and Etihad Rail expansion signifies a transformative moment, with significant implications for real estate.
Loai Al Fakir, CEO of Provident Real Estate, said the Dubai Metro and Etihad Rail expansion signifies a transformative moment, with significant implications for real estate.

“While it is difficult to predict the exact extent of price valuation growth, we can reasonably expect to see significant appreciation in areas along the Metro and Etihad Rail lines. The improved connectivity and accessibility will make these areas more desirable, attracting both potential residents and businesses. As a result, demand for real estate will outpace supply, leading to upward pressure on property prices,” he said.

A transformative momenT

Loai Al Fakir, CEO of Provident Real Estate, said the Dubai Metro and Etihad Rail expansion signifies a transformative moment, with significant implications for real estate.

“By prioritising accessibility, transit-oriented development, and sustainability, Dubai is poised for substantial growth promising increased prosperity and connectivity,” Al Fakir said.

A picture taken on April 1, 2021 shows a train of the Etihad Rail network, in Al Mirfa. Etihad Rail, when completed, will run across a 1,200-kilometre track that will connect all of the emirates — from Ghweifat in the western region of Abu Dhabi to the emirate of Fujairah on the eastern coast. — AFP
A picture taken on April 1, 2021 shows a train of the Etihad Rail network, in Al Mirfa. Etihad Rail, when completed, will run across a 1,200-kilometre track that will connect all of the emirates — from Ghweifat in the western region of Abu Dhabi to the emirate of Fujairah on the eastern coast. — AFP

The real estate agency said the expansion of the Dubai Metro, combined with the introduction of the Etihad Rail passenger train, represents a monumental leap in accessibility.

New lines and stations will seamlessly connect previously untapped areas to the heart of the city. This heightened accessibility presents a wealth of opportunities for real estate developers and investors, as areas once considered remote now emerge as prime targets for development.

The real estate analysts said Dubai's rapid urbanisation has led to increased traffic congestion, however, the metro and rail’s timely expansions serve as critical solutions to this challenge.

“Efficient and reliable alternatives to private transportation will encourage residents to opt for public transit, reducing the number of vehicles on the road. This not only leads to lower carbon emissions, but also alleviates the strain on road infrastructure, making Dubai a more attractive destination for investors and residents alike.”

The proximity to metro and rail stations has long been a significant factor in influencing property values in global real estate markets. With the expansion of the Dubai Metro and the introduction of the Etihad Rail passenger train, properties located near these stations are expected to experience a surge in demand and subsequent value appreciation.

“Investors stand to benefit from this trend, as properties in these prime locations become in-demand properties,” according to Provident Real Estate’s statement.

— muzaffarrizvi@khaleejtimes.com


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