Skyscrapers in Dubai and Abu Dhabi are trailing far behind the leading cities in a list of the world's priciest high-rise real estate.
The two UAE cities were placed 16th and 18th respectively in the global ranking, according to findings by Knight Frank.
Hong Kong and Tokyo staved off all challengers to claim the top spots. New York’s Manhattan was ranked third.
The consultancy listed Dubai’s “prime capital value” at Dubai’s priciest skyscraper as commanding $6,896 (Dh25,308) per square metre, while Abu Dhabi’s is estimated at $6,251. However, the costliest piece of skyscraper real estate in Hong Kong is estimated at a substantial $69,222, Tokyo’s at $42,283 and Manhattan’s at $25,740.
“While Hong Kong and Tokyo are too far ahead to lose first and second place, I see some competition amongst Manhattan, London and Singapore in the coming year,” said James Roberts, head of commercial research at Knight Frank. (The Knight Frank Skyscraper Index bases the commercial value on an analysis of the capital value of upper-storey floor space.)
Local market sources say that Burj Khalifa is not the runaway winner when it comes to skyscraper values in Dubai.
“New launches in Downtown have been taking place in the range of Dh2,000-2,800 a square foot for off-plan properties and certain units in Residences — especially two- and three-beds facing Burj Khalifa and the Fountain — are already at Dh3,500-4,000 per square foot,” said Niraj Masand, partner at Banke M.E. “Burj Khalifa units are available in the secondary market at between Dh3,800-4,200 a square foot.”
During the absolute peak of Dubai’s property market prior to late 2008, Burj Khalifa residential units were quoting in the range of Dh 8,000 a square foot. (The project itself was completed in late 2009 and the handovers started from early 2010.)
“While the rest of the market has seen a good upswing, the best of Burj Khalifa is still to come,” Masand said. “Over the last six months there has been a resurgence in demand for apartments in Burj Khalifa. Typically, trophy towers gain demand when there is a resurgence of confidence in the markets and this is a prime example.”
In Abu Dhabi, the Sun and Sky towers on Al Reem Island lord it over the emirate’s skyscrapers, with values in the Dh1,500 a square foot and over range depending on the floor level, etc, according to Robin The, country manager for the UAE at Chesterton International.
As to what this year holds for global skyscrapers and their investors, Roberts said: “In London there is renewed confidence thanks to better than expected economic growth and rising rents in the office market and I suspect London could overtake Singapore.
“Given the economic uncertainty in emerging markets, in 2014 we will probably see some of the Asian cities slide down the table, and more western cities on the rise.”
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