Nakheel reported a 36 per cent increase in its first quarter net profit to Dh491 million, boosted by unit deliveries and growth in its retail, leasing and leisure segments, it said in a statement yesterday.
The Dubai-based developer earned a net profit of Dh491 million in the first quarter compared to Dh362 million in the same period last year.
Revenue for the first quarter reached Dh2.185 billion, a 62 per cent increase from revenues of Dh1.35 billion in the same time last year.
Matthew Green, head of research at property consultancy CBRE, expects the developer to see improved growth this year over 2012 with continued unit handovers to customers over the next 12 months and improving sentiment in the market.
“We are likely to see further launches from them over the course of this year. We see sentiment back in the market and investors are here in large numbers looking for opportunities. Prime projects in the Palm Jumeirah proved to be popular, especially villas. Other projects in that quality will generate interest and help balancesheets,” he said.
“They have moved to a model of income-generating assets and expanding the retail division with the second phase of Dragon Mart for example,” he added.
Asked how developers in the market, including Nakheel, would be affected by Emaar’s move to sell the townhouses in the Mira project for under Dh1 million, he said: “We are going to see other developers going back to off-plan sales but they can’t do as Emaar has done. It’s a lot of competition and it must be worrying for other developers when Emaar goes into the sub-million category where it has never been.”
Nakheel delivered 5,400 homes, including around 770 in the first quarter. Handovers are mainly in Nakheel’s Palm Jumeirah, Al Furjan, International City, Jumeirah Village, Jumeirah Park and Jumeirah Heights communities.
Nakheel said it aims to deliver about 3,000 units this year.
Retail, leasing and leisure segments have recorded “encouraging growth” and contributed to the first quarter results, it said.
It has already launched Nakheel Mall, The Pointe at Palm Jumeirah and the extension of Ibn Battuta Mall.
Several other residential and retail projects including Palma Residences, Palm Views, Jumeirah Park, Dragon Mart extension and community centres at Discovery Gardens and Jumeirah Park are under construction
By the end of the first quarter, Nakheel made interest payments of Dh206 million to bank lenders and issued Dh120 million for the fourth tranche of its trade creditor sukuk.
Since restructuring, it has paid over Dh1.1 billion in loan interest and sukuk profit payments and made cash payments of around D