RAK property projects sold out as zero tax, full foreign ownership attract global investors

Demand for properties in Ras Al Khaimah is growing exceptionally well, mainly driven by investors looking for long-term rental income and short-term holiday home rentals. Numerous private developers are setting sights on the emirate’s real estate market to cash in on the demand, especially after the announcement of the $3.9 billion (Dh14.3 billion) gaming resort Wynn Al Marjan Island in Ras Al Khaimah.

Being developed by local partners Marjan LLC and RAK Hospitality Holding, the hospitality and gaming project will attract thousands of visitors from around the world. This project is expected to boost the profile of the emirate, with high-profile investors pumping money into the projects on Al Marjan Island.

Sold out

“It is high time to look at Ras Al Khaimah, especially Al Marjan Island. There is an unprecedented demand from investors for projects coming over there. The entire stocks on the Al Marjan Island have been sold out. And they are offering exceptionally good returns to investments,” said a real estate executive during a conference recently in Dubai.

He pointed out that a strong secondary market is also emerging for the northern emirate’s property market, which is a good sign of the maturity and stability of the market.

In September, RAK Properties sold out phase one of Cape Hayat on the first day of its launch, reflecting the demand for the off-plan is strong. Cape Hayat is located on Hayat Island, Mina Al Arab, and is a luxury collection of residential apartments with direct access to the beach and views across the Arabian Gulf and Hajar Mountains.

John Allen, CEO of valuation and advisory at Asteco, said the increase of large-scale investments in Ras Al Khaimah by local and international hospitality players marked a new phase of development and has had and will continue to have a positive impact on the real estate market.

The emirate’s property market is proving particularly strong, partly due to its relative affordability when compared to Dubai.

“The primary driver of demand is currently from the investment sector which includes investors seeking long-term rental income, short-term holiday home rentals and/or expectations of capital appreciation. The number of first-time buyers has also increased with many long-term residents seeking to gain a foothold on the property ladder,” he said.

Furthermore, there is also increasing demand for secondary homes, from international buyers as well as UAE residents, seeking a local getaway.

Outlook

Going forward, the northern emirate’s property market is predicted to continue its robust growth backed by supporting infrastructure, complementary policies, and a diversified economy. Over the past two decades, the real estate sector has recorded a substantial increase in development activity and a shift in demographics. “The expansion of the RAK’s tourism sector will continue to promote the construction of hotels and resorts, as well as retail, leisure and adventure facilities, boosting residential demand,” said Allen.

According to Obaid Salami, general manager of Dubai Investments Real Estate, investing in Ras Al Khaimah presents a compelling opportunity for several reasons.

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“Firstly, RAK offers a strategic location with easy access to major markets in the Middle East and beyond. Its proximity to key transport hubs like ports and airports enhances logistical advantages for businesses. Secondly, it has a business-friendly environment with investor-friendly policies, including 100 per cent foreign ownership and zero taxation. This fosters a competitive advantage for businesses and investors alike,” said Salami.

RAK also boasts a diverse economy, with thriving sectors like manufacturing, tourism, real estate, and renewable energy, providing investors with a range of opportunities to diversify their portfolios.

1,000 new units

Most of the new supply is on reclaimed land along the coast, and it represents a significant addition and improvement over existing properties. The coast's growth as a freehold destination has resulted in a variety of master-planned, waterfront, mixed-use (residential and hospitality) developments, including Al Hamra Village, Mina Al Arab, and Al Marjan Island.

Moreover, Aldar acquired a beachfront plot located on Al Marjan Island, spanning over 430,000 sqft to develop a residential community comprising a mix of over 2,000 branded and premium residences with access to retail spaces, a beach club and 2km of private beach.