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NRIs snap up prime housing projects

By Vimala Vasan

ABU DHABI: Non-Resident Indian (NRI) businessmen and professionals from Kerala and other parts of the country are scouring real estate investment options in the Gulf and investing sizable amounts in prime projects in recent months.

Triggering this interest in the realty sector was Dubai's decision to throw open major residential projects for expatriates on a freehold basis two years ago, that has found an echo in a couple of other countries in the Gulf in recent months.

Dubai, the United Arab Emirates' (UAE) regional business hub, initiated the move to involve expatriates in real estate investments by launching specific projects for this purpose in a phased manner in the city's booming suburban skyline. Recently, Qatar and Bahrain have also placed on offer a few projects for purchase by expatriates.

As a result, upscale properties that feature state-of-the-art building designs and a host of attendant amenities are now on offer for expatriates. The icing on the cake is the themed residential parks coming up in The Palm project, a newly created Dubai coastline, shaped in the form of date palm fronds visible from the Moon. This is being tipped as the eighth wonder of the world.

Not surprisingly, a large number of NRIs with surplus liquidity at their disposal and hitherto lacking investment avenues in the Gulf are now prominent among prospective expatriate investors who have been queuing up to book apartments or posh villas in the new projects. Some of the owners have already moved into their new homes and are looking forward to a long stay in the Gulf. Apart from the attractions of a tax-free society that the UAE offers, investors are also assured of visas, which will enable them to reside in the country irrespective of their employment status.

The properties range between Dh 200,000 and millions of dirhams. NRI investors contend that the high quality of the projects in most cases justify the costs, particularly when compared to similarly priced properties in Indian metros. Living standards in the UAE are also comparable to developed cities such as Singapore, thereby making their investment worthwhile, they said.

Mr. Muralidharan, a UAE-based businessman from Kerala, has, along with a group of prominent NRIs, invested in Spanish-themed villas in The Palm. Mrs. Muralidharan is excited at the prospect of moving into the high profile location. "The Palm is a wonder of the world and we are looking forward to settling down there when our villa is ready by 2006," she said.

A medical practitioner hailing from Kerala, who runs a clinic in Abu Dhabi and has been living in the UAE for two decades, said that he and his daughter have invested in apartments in Dubai's Emaar Projects mainly because of the excellent living conditions in the UAE. "I can also easily visit my son in the United States from here," he says, but insists that he would regularly visit India to oversee several investments that he has down south.

As business interests are likely to keep these NRIs in the UAE for a long time, many of them have also invested in a couple of other projects.

Mr. Suresh Kumar, General Manager, Emirates Bank Group, says that the bank is planning to conduct a study on the property sector in Dubai. Early assessments have shown that expatriates are buying properties either to live in them, or to convert them to equity through renting them out, with returns ranging from 8 to 10 per cent as against current low interest rates on other instruments.

NRIs from London and the Far East have snapped up properties in Dubai, while NRI wannabes from India have also been looking at properties in the Gulf as it would enable them to get a foothold overseas.

A road show held by Dubai realtors in Mumbai some months ago reportedly received good response from Indian investors.

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