Nakheel eyes Dh1 billion recurring income this year

dubai - The Pointe and Nakheel Mall on the Palm and Night Souk on Deira Island will open this year

Master developer Nakheel is looking to diversify its portfolio into different asset classes, with a special emphasis on F&B. It expects to generate at least Dh1 billion in recurring income by the end of this year.

This strategy will be supported by the opening of various shopping and entertainment destinations, starting with The Pointe, a Dh800 million, 1.4 million square foot promenade on the Palm Jumeirah which will feature 70 restaurants and a Reel Cinema multiplex, which is set to open on October 1 this year. This will be followed by the Nakheel Mall opening on the Palm Jumeirah and the Night Souq on Deira Island at the end of the year. Nakheel will also generate recurring revenue from leasing out more than 1,500 villas in Nad Al Sheba.

The Pointe is already 75 per cent leased out and there will be a Mono Rail station in the development.

"Currently, recurring income makes up 25 per cent of Nakheel's revenues," says Ali Rashid Lootah, chairman.
In the freehold space, Nakheel will kick off a major campaign for the Palm360 in key overseas markets later this year before actually starting sales. The Palm360 twin tower contract award will be the biggest on the Palm this year, the chairman adds.

Meanwhile, at Deira Island, Nakheel is looking to create a full-fledged tourist destination, but with 3 and 4-star hotels and resorts.

"Dubai currently does not have hotels that cater to this visitor profile - those that do are hotels based in the city and guests have to be bussed out to the beach every morning. That's not how it should be. Deira Island will set that right. You can never go wrong with waterfront real estate," observes Lootah.

Nakheel has sold a majority of the waterfront plots at Deira Island and retained some for projects of its own. So far, it has struck alliances with 3 hotel operators, such as RIU and Centara. Another 2 joint ventures are in the pipeline, the chairman informs.

"We are bringing partners who are serious about committing to our idea of what Deira Island should be. They are bringing in their share of the funds."

Deira Island will also include what will be Dubai's largest mall, at 10.3 million square feet of built-up area of which 4 million square feet is leasable. Nakheel awarded a Dh4.2 billion contract for the mall's main works to Unec last year.

"Within a year, we will start work on the Boulevard in Deira Island," says Lootah.

The chairman says Nakheel is focusing on building facilities within its existing communities. It recently struck a joint venture with Sharjah's Shurooq for a community mall in the northern emirate and another with Al Nasr Cultural and Sports Club for one in Al Khawaneej, Dubai.

"If someone has the land and makes an approach, I say 'Why not?'," Lootah adds. "It could be in other emirates, it could be outside the UAE as well. Anything that interests us, we will pursue."

- deepthi@khaleejtimes.com