State-backed developer Nakheel will see its 2011 profit exceed the $234.1m posted last year and expects to issue the final tranche of its $1.63bn Islamic bond by the year-end, its chairman said.The developer, which split from parent firm Dubai World in August to become a government entity, said profit would come from its leasing and retail business which is yielding 20 percent above expectations.
“We have our collections from customers, from retail, from leasing,” Ali Rashid Lootah told reporters at Cityscape Global on Tuesday. “Leasing and retail, we’re doing about 20 percent higher than planned. Sure [we’ll make a profit]. It will not be less than 2010,” he said.
“Before the end of the year [we’ll issue the remaining sukuk].”
The state-owned firm does not plan to issue any further sukuks, but will go to the market for future financing if required, he said.
Nakheel was one of the biggest casualties of Dubai’s real estate crash, suspending at least 100 projects in the wake of a property collapse that more than halved house prices in the emirate.The developer said this month it wrote down AED78.6bn ($21.4bn) from the value of its real estate during the Dubai debt crisis.
Nakheel also unveiled plans to build 102 beachfront townhouses on the Palm Jumeirah, where villa prices have begun showing signs of recovery, according to consultancy Jones Lang LaSalle.“Oversupply depends on which area and what type of product,” said Lootah. “We see stability and we see an increase in certain products; rentals on villas, for example, are increasing. On Palm Jumeirah and Palm Island the property prices are increasing so this is a sign of recovery. Always the good products get moving first,” he said.
The developer said in August it also plans to build a community mall on the offshore island.
Revenue for 2011 has increased amid a 10-15 percent increase in the management and leasing of fully-owned assets and a rise in residential unit occupancy, Lootah said.
Dubai’s property prices are expected to drop further as 54,000 homes will come onto the market between 2011 to 2015, Jones Lang LaSalle estimates. That’s about 15 percent to 20 percent of the existing supply, according to the real-estate broker.