Artar’s Okbah Abdulkarim talks about building quality projects
Okbah Abdulkarim, executive director at Artar Real Estate Development talks about running the company in the UAE and how experienced developers could face unstable markets with quality projects
Abdulkarim is a man who values positivity. During the financial crash of 2008, when business faced its toughest time, Abdulkarim was sure the market would bounce back and the construction industry would recover.
The Saudi-based company has a track record of 50 years with construction and development around Saudi Arabia, France and the UK. In Saudi Arabia alone, the company has over 35,000 employees.
Currently serving as executive director at Artar Real Estate Development, Abdulkarim heads all the operations in the UAE, since he established its branch in UAE two years ago.
The executive director has extensive experience in the field of construction dating back to 22 years. Unofficially, however, he has been affiliated with construction since the age of eight. As a child he worked alongside his father in his family contracting business.
After earning a degree in civil engineering, Abdulkarim worked as a contractor before he made his move to become a developer.
In Dubai, Abdulkarim has worked with Select Group for six years as the head of development and with Emaar as the senior manager of projects for four years. Some of his most recognised projects include Dubai Marina Mall and three Address Hotels across Dubai. He has also worked in several international projects in Morocco, Tunisia, UK, Croatia, India, Syria and Lebanon.
Two years ago, he was sure his next move should be to head a company himself, which is when he started the division of Artar here in the UAE.
Artar in UAE
The UAE branch of Artar works in both investments and developments, with its first luxury project, Mada Residences, launched in Downtown Dubai in January 2016. The project comprises of a total of 193 spacious units of various sizes. With floor areas starting at 882 sq.ft and each room styled to be light, airy and spacious.
Apartments within the project will be available to clients through a special investor-friendly payment plan from Artar, which requires 30% during the first year and the final 70% to be paid upon completion of the project. The company is in the process of establishing commercial arrangements with local banks to facilitate convenient finance terms for buyers.
Foundations on the tower were completed a month ago, comprising 10% of the entire project and setting construction on course to complete according to schedule.
Main consultants and contractors on the project include National Engineering Bureau (NEB) and Construction and Reconstruction Engineering (CRC) respectively.
The company also has another ongoing project in Dubai within City Walk. The project, Number 2-B building, which will be completed in June and handed over in July 2016. However, Abdulkarim clarifies that this building will not be on sale but kept as an asset for the company.
Artar is currently looking for many other plots across Dubai including Pier Jumeirah and Dubai Parks and Resorts. “We are looking for plots for development, preferably to get mixed-use projects.”
Artar works on a fixed income basis. Abdulkarim explains that the company has its own fund, which allows flexibility for buyers. “Our payment plan of 30% initially and 70% on handover is unique. Not many developers can afford this kind of payment scheme and this helps build confidence in our brand among our customers.”
Delivering a good project
“A developer is always judged by the quality of its project,” Abdulkarim observes. Every time he works on a project, he makes sure he works on the whole lifecycle of the project, from the design to handover.
“You have to study your project well,” he insists.
According to him there are many factors that need to be met when a developer wants to work on a project.
The number one thing every developer must keep in mind, he states, is if there is a demand for the project. “There is no point creating something that does not fulfill anyone’s requirement.”
Secondly, he says, there needs to be a target audience around whose needs you could mould your project.
With Mada Residence Tower, Arkan is targeting the GCC buyer, specifically the second home market, which is growing significantly due to Dubai’s attraction as a tourist destination, in addition to increased airlift. In tailoring the product to the needs of this guest profile, the smallest unit, a one bedroom apartment, covers 1,100 sq.ft.
He adds: “You have to study prices so that what you are creating is not overvalued or undervalued.”
Out of all the factors, Abdulkarim admits that picking the right location for the project is one of the most crucial in his rule book. “You have to make sure to choose a good location, with the right infrastructure around it to make it accessible.”
He says that some developments are built far away from the main city and the area around it will still need 10 to 15 years to be developed. This, according to him, is not good planning.
Whereas there are some good areas in the inner city, where the infrastructure is complete and have everything is at your doorstep. “It is a blatantly obvious to all developers that location matters.”
It is also important to choose a good team to work with and build, which includes the right consultants and the right contractors. People who have a good track record.
Arkan makes sure to be very thorough during the delivery of the project. Abdulkarim discloses that he prioritises the design and tries to make the least amount of changes to it.
He points out that the design must be 100% complete and materials for the project should be selected before the construction begins. “Developers need to stop making changes while construction is ongoing in the project.”
Marketing your project
Abdulkarim confesses that a developer has a lot of challenges, first to build a project and then to sell.
He says that there needs to be a strategy to sell and market a product. “Otherwise you will build it and nothing would come of it.”
You need a good marketing team and an excellent sales team. They need to know how to make and maintain connections and how to market your project to the right people.
In Artar, Abdulkarim provides the team with a very comprehensive guide that includes all the details about the project so that they would be capable of answering any technical questions thrown in by customers. He and his team try their best to provide what the customers need. He states: “We are one of the very few companies to show the buyer the materials so that they can touch it and know what they are going in for.”
Abdulkarim reasons that Dubai has huge potential when it comes to hospitality projects. “As a tourist hub, Dubai is one the top ten cities in the world. I think there is a huge potential in the market, with the need for serviced apartments with a good 5-star operator.”
He explains that most of the tourists making their way into the city are coming from the GCC, and GCC nationals find it much more comfortable to live in a serviced apartment rather than hotels.
Apart from serviced apartments there is also and increasing demand in residential apartments (for sale and rent) according to Abdulkarim. However, he acknowledges that transactions in the residential sector have been in decline since 2015 and have been low this year. But still he thinks the market is very competitive at the moment and people should use this opportunity to invest with all the attractive prices.
He suggests investors should know more about the development before investing. “If you want to buy property, you should buy it from someone who is well known and experienced.”
“I think some new developers, especially those who do not come from a development background, are not serious about the development and are just here to make money.”
He says that most of these kinds of developers cannot last the tough times and end up leaving a project midway or getting delayed by three to five years. “When a project gets delayed there are many consequences to be faced. Time is money, and a delay will cost them.”
Delays, he explains, are caused by many reasons, and could be the developer, the contractor or the consultant’s fault. “Sometimes all of them. But to avoid delays one thing that needs to be done is to work with a good qualified team.”
Abdulkarim says that new, investor protection laws work in favour of the investors and developers. “It protects investors, the image of Dubai and the rights of the people.
“There are many developers out there, if you check RERA you will find over 1,000 developers. But very few of them are active in the market.
“Stricter regulations, however, have discouraged a lot of inexperienced developers who are trying hustle their way into the local market.”