Why an empty sand area in Dubai sold for a record $34 million

(CNN) There are many things that can be bought with $34 million. In various parts of the world, that amount can buy castles, grand mansions by the beach, or majestic estates that stretch for miles and miles. Fleets of powerful Lamborghini sports cars or stately Rolls-Royce Phantoms could be bought. You could even buy a private jet.

In Dubai, you buy a lot of sand.

Well, not just any pile of sand. The arena in question is a vacant property on the luxurious island of Jumeirah Bay, which recently sold for more than $34 million, an exorbitant price even in a part of the world where property prices can be as high as architecture. of the skyscrapers.

Umar Kamani, a British businessman and co-founder of the PrettyLittleThing fashion store, has sold this 24,500-square-meter property. The sale, for AED 125 million, marks a whopping 242% gain on the original purchase price of AED 36.5 million, or just under $10 million, in 2021.

The identity of the buyer is unknown.

The property’s size is one of 128 originally offered on the artificial island, which is connected to the mainland by a 300-meter bridge. Its astronomical price is a reflection not only of the resilience of some of Dubai’s real estate to the downtrends of global economies, but also, according to real estate agents, of what the mega-rich want to spend their dollars on.

“Jumeirah Bay is the most exclusive of the exclusive,” says Andrew Cummings of Knight Frank Dubai, the real estate agency that managed the sale. “It’s for the very high net worth people who are asking, ‘What’s the best I can get?’ It’s best in class for location and property in Dubai.”

shaped like a seahorse

The 6.3 million-square-meter island is shaped like a seahorse and features a five-star hotel developed in collaboration with Italian luxury brand Bulgari, which opened in 2017 and was quickly crowned best new. luxury hotel in the world. Jumeirah Bay Island is also home to numerous sandy beaches and a marina for dozens of yachts, high-end restaurants, a gym, and a spa center. There are also a limited number of luxury apartments in the Bulgari hotel complex.

In 2022, two similar pieces of land on the island sold together for AED 180 million, or just over US$49 million, indicating that land values ​​are on the rise. “The land has appreciated enormously, not least because of its location, very close not only to Bulgari, but also to the Four Seasons, as well as downtown Dubai and the business district,” says Cummings. “But also because of the privacy and exclusivity offered by an island that only has about 100 parcels, as opposed to somewhere like Palm Jumeirah, which has thousands of properties.”

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Google Earth view of the island of Jumeirah Bay.

Palm Jumeirah is perhaps the best known of Dubai’s artificial islands. Famous for its palm tree shape, it is also the largest artificial island in the world, with about 3.2 km2.

By contrast, Jumeirah Bay Island is much smaller, at just 0.6 square kilometres, and is considered more exclusive. “It’s really for the 1% of the 1%, building their forever home or their long-term vacation home,” Cummings explains. “And the kind of property that’s being built there now is like nothing you’ve ever seen in Dubai. Jumeirah Bay is going to be a lot more like Beverly Hills or Los Angeles.”

Dubai’s property market has been on a roll of late, with 93 property sales worth $10 million or more in 2021, more than the previous seven years combined, according to Cummings. In 2022, that number has skyrocketed to 221 sales. This year there have already been 88 in the first quarter.

The pandemic has played an important role in this rebound. “In the last couple of years, people have wanted to move to bigger places, they’ve wanted to live on the beach,” Cummings says. “If you look at New York, people moved to the countryside, the same in London and other big cities. In Dubai we saw that, but also a huge influx of international investors attracted by the incredible covid management, the high vaccination rate , security and protection, but also because of lifestyle”.

What you get with US $34 million

The island’s original 128 lots have dwindled to just over 100 as some buyers purchased more than one to build larger villas. Most remain empty, and Cummings estimates that only one in 10 is inhabited. However, he predicts that this sale will further increase the value of the parcels, as well as that of the mansions that may come on the market once built. “We have one under construction that will come on the market at the end of the year and will probably ask for more than US$100 million,” she says.

Currently, there is a vacant parcel on Jumeirah Bay Island for sale for AED 90 million, about US$24.5 million. A three-bedroom, four-bathroom apartment in the island’s Bulgari complex is being offered for AED 60 million, about $16.3 million.

As for Kamani, he probably doesn’t grieve the loss of his plot, because he owns an identical one right next door. Who knows if he too will sell it at an even higher price.

“He’s set the benchmark,” says Cummings, “so now he could set another record.”

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