Will ‘Metaverse Mansions’ be the Future of the Real-estate Sector?

As the world is becoming more digital day by day, investors are also banking on virtual real estate to achieve high returns on their investments. Metaverse is a digital space which allows participants represented by 3D digital representations to interact. It is an online equivalent of a person transacting and interacting in the virtual world. Payments in Metaverse are made in cryptocurrencies that operate on the blockchain. Thus, they are highly secured. Metaverse has no defined owner and the network can be expanded internationally. Meta CEO Mark Zuckerberg predicts that the Metaverse will be mainstream in 5-10 years. Facebook will be spending over USD 150 million to train the next generation of creators to build immersive learning content and to increase access to devices.

Metaverse encompasses all emerging technologies like blockchain, Artificial intelligence (AI), 5G, and content creation. The top real estate developers and brokerage firms are betting big on metaverse mentions and are investing hugely in the virtual world.

What are ‘Metaverse Mansions’ and Why they are Important to Investors?

Metaverse mansions are the parcels of land in virtual worlds. They are programmable spaces in virtual reality platforms which allow people to socialize, attend meetings, play games, sell non-fungible tokens (NFT), attend virtual concerts, and perform thousands of other virtual activities. Creators can monetize the content of their property by just charging for access or trading their NFTs.

Metaverse Mansions or properties are equally important for the corporate sector. A large number of Fortune 500 companies are using virtual properties to advertise their products & services. Metaverse Mansions allow real estate investors to earn lucrative returns on their investments by investing the parcels of digitalized land. Metaverse mansions can be leased as well.

 Global Real estate Sales on Metaverse

The 2021 report by MetaMetric Solutions reveals that real estate sales on the four major metaverse platforms reached US $501 million in 2021, and the sales volume is expected to double in 2022.  Another study by Brandessence research projects the metaverse real estate market to grow at a CAGR of 31% from 2022 to 2028.

Where Does Dubai Stand in Metaverse Mansions? 

Dubai is all set to launch the first Metaverse mansions in the MENA region in 2022. Dubai-based real estate brokerage firm, Union Square House (USH) has announced the launch of the first Metaverse mansion this year. Banking its hopes on 80%+ of Dubai’s young population who are familiar with the virtual property, USH is in the process of developing and selling luxury digital properties as a non-fungible token with or without their physical twins. With this Dubai will become the second city in the world after Hampton in England where the metaverse mansion was put on sale in the form of Hampton Hall for £29 Million in February 2022

The rising adoption of Web3 and Non-Fungible Tokens (NFTs) among the corporate sector in Dubai has been the biggest driver. The real estate sector is expected to be the biggest beneficiary of Web3 adoption. Furthermore, there has been a substantial increase in the number of lenders who are willing to offer mortgages at fair rates to support investors in buying virtual properties. This will accelerate the pace and value of their virtual assets in the metaverse.

Dubai will also witness its first set of Non Fungible Tokens in July this year with only super-luxury properties located in The Palm Jumeirah, District One, Emirates Hills, and Dubai Hills Estates will be sold. Union Square House is in the process of turning it into reality and will replicate the success in Abu Dhabi and other major cities in the Middle East. 

Government Initiatives to Boost the Growth of Metaverse Mansions

Here is the list of initiatives launched by the Dubai government to boost Metaverse 

  • In April 2022, Dubai World Trade Centre launched MetaIncubator, the first Metaverse incubator in the Middle East. MetaIncubator was the first Metaverse Incubator in the Middle East with a mission to incubate early-stage Metaverse and Web3 projects through Dubai as a hub. It strengthens & supports the idea of Dubai’s digital strategy and offers world-class engineering, marketing, tokenomics, and investment services to startups. It also supports startups that want to get into the growing MENA regions. 
  • In March 2022, Dubai Municipality launched a programme called One Human Reality Talks. The programme aims to bring companies & investors together to develop & invest in new reality platforms.  

The Future of Metaverse Mansions in Dubai

There has been a substantial rise in the number of big real estate players betting their fortunes on Metaverse properties. Some of the biggest names include Emaar and Damac. Damac Group has entered the metaverse to build its own digital cities. The real estate developer has announced in April 2022 to invest US $100m in building metaverse digital cities. 

Dubai has gone one step far from the rest of the world by organizing Meta Ramadan Majlis (a traditional gathering) on Metaverse. The Meta Majlis was co-created by Chikara Global, a women’s group, and Biennale.io, a community-curated digital ecosystem. The Majlis witnessed the participation of experts and youth. There were discussions hosted on the future of communities and exploring more possibilities for community development in the Metaverse.

With an exponential rise in Metaverse mansions in the last two years, experts predict that Dubai will become a major metaverse hub in the Middle East soon. Dubai is designing the blueprint for the next phase of humanity’s virtual future with extended reality (XR). The government will work with investors and private sector firms to create a futuristic, human-centered version of the metaverse cities. Bedu, a UAE-based start-up focused on the metaverse decided to launch its operations in Dubai to make it a hub for emerging technologies. The company is a leader in Web3 technologies and solutions and will attract investments and talent from across the world to the UAE to boost metaverse activities, blockchain, NFTs, and Web 3 revolution in the region.

Metaverse mansions are gaining global attention. It is indeed a golden opportunity for the real estate sector to maximize its revenues. Dubai is emerging as a frontrunner in the race; however, the business climate is very dynamic with new activities & developments taking place every minute. 

The Role of Real estate 2.0 in Simplifying Home Buying Experience

Real estate has emerged as the fastest-growing sector in technology adoption. It has moved from being a laggard a decade ago to a frontrunner today. The use of technology in real estate starts at a very early stage when buyers conduct online searches to find out if the property matches their requirements. The use of Artificial Intelligence and Cloud has made the home buying process more simple, personalized, and hassle-free for real estate buyers. Virtual tours, virtual inspections, drone photography, and geolocation tagging, are some of the most prevalent technologies which are assisting buyers in their search for their dream home. Technology is also empowering real estate investors in finding out the soil condition, air quality, and water table of the area where the property is located. The introduction of property listing platforms has made it much easier for property buyers to search for local brokers beyond their geographical reach. 

Real estate 2.0 revolution has positively impacted every stakeholder. The adoption of Big Data and Artificial Intelligence (AI) has empowered real estate developers and property management (PM) firms in meeting the expectations of the buyers while maintaining the regulations set by the Dubai land department (DLD) or the Real estate Regulatory Authority (RERA). Real estate 2.0 has been instrumental in enabling developers & PM firms in meeting the two most requirements of every property buyer or resident – Security and Easy access. The usage of Internet of Things (IoT) sensors in residential communities has played a key role in ensuring the utmost safety of the residents and making the community more appealing to the buyers.

Here are the Top 6 ways Real estate 2.0 has simplified the home buying process

1. Deploying Virtual Assistants to Provide Faster Information to the Investors

Virtual assistants are assisting the potential buyers in finding out the information related to the proximity of the property from major areas like downtown, Business bay, Dubai Canal, and other prominent places of Dubai. It is also assisting buyers in getting faster information about the distance of the property from schools, offices, hospitals, mosques, etc. which required physical visits earlier. Property management firms are deploying AI-powered chatbots to answer all relevant queries of the buyers and simplify their property buying process. 

Deployment of virtual assistants has become more common since the beginning of Covid-19 to maintain social distancing. Virtual assistants helped the buyers in getting faster responses to all their queries. They have also enabled real estate developers in minimizing the requirement of hiring Sales agents to handle these queries which has reflected positively on their net revenues & sales.  

2. iBuying – Estimating Right Home Value & Eliminating Intermediaries

IBuying or Instant Buying is a term used for the companies which use algorithms to estimate a home’s value and then buy it directly from the owner for cash. This method is becoming more prevalent as it assists brokers in easily setting up the process using powerful algorithms and providing instant offers to the seller. 

IBuying is playing a key role in eliminating the brokers as well as the banks from the home buying process by generating an automated valuation using mathematical algorithms and providing a seller with a more streamlined way to sell the house. This is leading to the faster sale of the property. IBuying continuously updates new inventory added to the market and provides more desirable options to the buyers which most closely match their requirements. With the help of IBuying, it is become very simple to schedule the property viewings and keep an eye on the condition of the property before the final possession.

3. Blockchain-powered Applications to Boost Security & Transparency

Blockchain-powered applications have played a critical role in streamlining the complex processes for real estate investors by making them digital. This is one of the reasons that there has been a substantial push from the Dubai land department (DLD) on implementing blockchain-powered applications to provide faster information to the investors at a click of a button. Blockchain technology makes real estate transactions more secure and reliable and simplifies the process of land registrations by creating a database which cannot be tampered with and is easily accessible. This minimizes the risks involved in the investment for real estate investors and encourages them to pump more money into the property and reap a high rate of returns.

Initiatives launched by DLD to Implement Blockchain-powered Applications

Some of the initiatives launched by the Dubai Land Department to implement blockchain-powered applications to streamline the real estate investment process are as follows – 

  • In 2022, Dubai Land Department launched ‘DXBinteract.com’ – a blockchain-powered tool to protect the tenants from paying higher rents pitched by the brokers or landlords. The platform provides real-time information to the tenants on the rental history of a property and assists real estate investors with a listing of past values to ensure they don’t end up paying a higher amount for the property and can make wise investment decisions. 
  • In 2020, Dubai Land Department joined hands with Smart Dubai Government Establishment (SDGE), Al Wasl Group, and Emirates NBD to launch of a paperless property rental platform to automate business processes between four connected UAE entities. The primary objective behind the launch of the platform is to integrate all four entities. du and SDGE have built a multi-purpose Dubai Pulse, to offer secure analytic, big data, and compute and storage services for the use of various government entities. It is available through du Blockchain Edge and Dubai Pulse links all the services to a digital tenancy contract through the solution, which is received within a few minutes following completion of the digital application. 

 4. Fractional Investing – Minimizing Risk & Cost of Acquisition

Real estate 2.0 has made it possible to address the challenge of the rising cost of the property. The concept has discovered alternative solutions for the investors to own a fraction of the property rather than buying it as a whole to gain the advantage of the high return on investment (ROI) offered by Dubai’s real estate market. ‘Fractional Investing’ has empowered multiple investors to invest in a property together to minimize the investment risk as well as the cost of the acquisition. This trend is widely popular among millennials who want to invest in high-end commercial properties but have limited funds. They can now buy a fraction of premium property and fetch a high rate of return. 

5. Using Advanced Analytics to Create more Personalised Experiences

Advanced analytics softwares is empowering real estate developers to bring personalization to the property purchase process.  The article titled – The Value of getting Personalization right—or wrong—is multiplying’ by consulting giant, McKinsey & Company states that ‘personalization most often drives 10 to 15% revenue lift (with company-specific lift spanning 5 to 25%, driven by sector and ability to execute). The more skillful a company becomes in applying data to grow customer knowledge and intimacy, the greater the returns.’ Advanced Analytics is playing a crucial role in attracting millennial buyers in buying a property. Using advanced analytics tools & applications, developers are making their conversations more personalized and appealing for the millennials.

6. Bringing Sustainability to the Real estate Sector

Millennials are now prioritizing the sustainability and green features of the building while buying or renting a property over price, rents, or service charges. To meet the demand of the millennials, developers are implementing Real estate 2.0 practices like – Net Zero Concepts to build more sustainable and environment-friendly buildings. Developers are installing green insulation, cool roofs, low-emitting materials, and Heating, Ventilation, and Air Conditioning (HVAC) to minimize the energy consumption of the building and reduce its carbon emissions to become a preferred choice of the millennials. 

Leveraging Real estate 2.0 sustainable practices, Dubai has become the third city in the world with the highest number of green-certified buildings in the ‘Sustainability and Wellness in Dubai’. The report by Core Savills reveals that there are over 550 projects under LEED certification. U.S. Green Building Council (USGBC) has ranked the UAE in 6th spot in the World in 2021 with 73 LEED-certified projects occupying over 13.7 million square ft. of area. 

Key Factors that can Hurt Developer’s Reputation

The real estate developers in Dubai face fierce competition. The sector has the presence of some of the most prominent and mammoth developers like Emaar Properties, Damac properties, Nakheel Properties, Dubai Properties Group,  Select Group, BinGhatti, and Sobha Realty to name a few. UAE’s favorable and business-friendly policies, rising investments in infrastructure, and low-tax environment is attracting the world to invest, live, and work in the city. There has been an exponential growth in transaction value and investment in UAE’s real estate sector in 2020, resulting in an increase in new development projects. This is also encouraging several international developers to develop new properties in Dubai which is further making the market more competitive.

As the business environment becomes more competitive, the developers must lay special emphasis on building their favorable brand image and must avoid making these 5 costly mistakes which can have a detrimental impact on their reputation –

1. Oversupply

It is of paramount importance for the developers to perform a critical and well-thought analysis of the current property demand as the oversupply results in downward pressure on the sales prices & rental returns. Furthermore, if the demand is low, oversupply leads to a large number of unsold units, which not only hurts the developer’s revenue but also dents its reputation. The supply for the property outpaced the demand in Dubai between 2014 and 2019. This widening gap between demand & supply has resulted in a large number of unsold units and developers cutting back on the new projects. The problem of oversupply has resulted in a 40-50% decline in property prices with a 5-10% decline in rents since 2014.

2. Lack of Financial Planning

Another pressing challenge faced by the property developers which can significantly impact their reputation is lack of financial management.  It is no secret that developers of all sizes face budget & cost constraints. Non-availability of funds can put a hold on the work at the construction site and leads to a delay in the possession of the property to the homeowners. In many cases, it has been witnessed that developers have failed to release funds to the contractor as their clients defaulted on monthly installments. This can seriously hurt the reputation of the developer. Effective management of finances determines the triumph of the developer. They must come up with a plan to ensure all their related parties pay on time. 

In the last few years, financial institutions in Dubai have revised their flexible lending policies related to loans, mortgages, etc., making it much more difficult for the developers to secure funding. Focusing on effective and efficient financial planning will enhance developers’ abilities to secure hassle-free business loans from financial institutions.

3. Operational Challenges 

Engineering problems or other technical issues can dramatically impact the performance as well as the brand image of the developer. Some of the most common technical issues faced by the developers during the construction process are related to civil, mechanical, and electrical works, etc. If these technical issues persist, they can adversely impact the overall quality of the building.

The most common root cause of quality constraints is the usage of poor quality raw materials and low-cost alternatives by the contractor due to insufficient budget. This often results in frequent breakdowns, leakages, and faults at construction sites.

4. Project Delays

It is pivotal for the developers to ensure better time management and achieve every task on time. There can be delays in procuring materials and equipment, allocating manpower, drafting change order requests, and resolving numerous issues pertaining to contractors, sub-contractors, and consultants within the internal management of the developer, shortage of materials on-site; unrealistic project scheduling; late delivery of material; lack of skilled labour; the complexity of the project; labour absenteeism; delay in payments, poor site management; and delay by a subcontractor are some of the top reasons for the delay in the project completion.

Better planning for these issues will allow developers to complete the construction work before the due date.  

5. Considering Hiring an Owners’ Association Firm as a Cost

It is a common adage amongst several small developers that they will save a substantial amount of money if they manage all the tasks themselves. However, that’s not true. Hiring the right owners’ association firm will allow the developers to save costs.

It is indeed very important for developers of all sizes to work on their public perception and the way people perceive them and their properties. Timely and professional resolution of tiny issues can have a positive effect on their reputation and vice-versa. It’s always a wise choice to invest money in the effective maintenance of the property at the right time rather than losing big on rental opportunities in the future.

A professional asset management firm can play a crucial role in building a positive brand image for the developer. This will attract more tenants and will have a favourable impact on the occupancy rate of the property as well as on the revenues of the developer from the rental income. A positive brand image will also empower the developers in accomplishing their mission & vision and long-term goals. 

Kaizen AMSa top 5 property management company in Dubai with over 15+ years of experience in serving some of the biggest real estate developers in Dubai can play a pivotal role in boosting the reputation of the developer by ensuring utmost tenant or resident satisfaction, finding out tenants to occupy the vacant units, ensuring rents are collected on time, and property value of the asset is preserved. 

Kaizen AMS also emphasizes maximizing the supplemental income of the property by generating additional sources of income from the building. We do that by leasing the parking space, terrace space,  Vending Machines, Marketplace, and storage room on an annual basis which resulted in more than 2% of the additional annual revenue for the building. 

Here is the case study titledCurtailing Costs & Boosting Occupancy for Commercial Buildings which talks about how Kaizen AMS has boosted the occupancy rate for a Grade A office building in Dubai Internet City by maximizing the supplemental income and focusing on keeping the rents & service charges minimal for the tenants. We have also invested in several energy-saving technologies to ensure lower energy bills for the tenants living in our managed communities. 

Undoubtedly, all the efforts laid by Kaizen AMS’ have resulted in a substantial increase in tenant satisfaction, a surge in the occupancy rate of the property by happy tenants, an increase in income from the property, and above all enhanced reputation for the developers of our managed communities. 

Why there is Rising Demand for Green Properties?

The belief that green properties bring multiple benefits for both residents and developers is becoming universal. The real estate buyers are realizing the integral role played by the green buildings in minimizing carbon emissions and contributing toward one of the biggest global agendas – Climate Change. Across the UAE, some landlords are evaluating the cost and the benefits of making their portfolios greener to meet the expectations of the property buyers as well as the tenants who are becoming more environment-friendly.  

Rising international focus on climate change, Conference of the Parties (COP26) summit and UAE’s net-zero initiative to minimize emissions and pledging to invest almost $165 billion in clean energy by 2050 are the other major reasons for the landlords to construct green buildings.

Covid-19 has created an urge for employee safety to ensure they feel comfortable coming to the office. To take employee safety to the next level, corporations are choosing green properties to prioritize employees’ well-being and adapt to their occupational strategies and achieve their sustainability goals.

What is a Green Building?

The World Green Building Council (WGBC) defines a green building as – “a building that, in its design, construction or operation, reduces or eliminates negative impacts, and can create positive impacts, on our climate and natural environment.”

Some of the features suggested by WGBC which make a building green include –  

  • Efficient use of energy, water, and other resources
  • Use of renewable energy, such as – solar energy, pollution, and waste reduction measures, and the enabling of re-use and recycling
  • Good indoor environmental air quality
  • Use of materials that are non-toxic, ethical, and sustainable
  • Consideration of the environment in the design
  • Construction, and operation
  • Consideration of the quality of life of occupants in design
  • Construction, and operation
  • Design that enables adaptation to a changing environment

Exponential Rise in the Demand for Greener Properties

There has been a huge rise in the demand for greener and energy-efficient properties not only in the UAE but across the Middle East. As per the Knight Frank – 2021 surveyproximity to green space and good air quality topped the list of location features and are more important to home buyers in the Middle East than their global counterparts. Half of the respondents cited the energy efficiency of their next home as being a ‘very important‘ issue, compared to 42% of global buyers.

There has been a rising demand for green and energy-efficient properties in the UAE. The region is at the pinnacle in the Middle East in the national concentration of sustainable buildings and stands at the 14th spot in the world with 869 green-rated buildings, according to the 2nd edition of Knight Frank’s (Y)our Space report – 2021 which surveyed almost 400 businesses worldwide on their workplace strategies and real estate needs.

This sends a strong signal to the developers and planners to embrace building green properties to attract eco-friendly homebuyers in the UAE.

Reasons for Rising Demand for Green Properties

Here are the top 7 reasons for the rising demand for Green Properties in the UAE

1. Increasing Awareness

The last decade has witnessed a colossal rise in the awareness among the UAE real estate developers and homebuyers about sustainable construction practices and the adverse effects of climate change, rising energy consumption, and carbon emission on their health and life which has significantly increased the demand for greener properties. 

The rising awareness about the advantages of green buildings is very evident from the leading studies conducted recently. The research conducted by EcoMENA in 2021 titled – ‘Green Building Trends in the Middle East’ reveals that in the last decade, green building design has become a top priority of real estate developers across the Middle East. The number of LEED-registered buildings has increased rapidly across the region, from 623 in 2010 to more than 2500 in 2020. UAE is ranked among the top 10 countries that hold LEED certifications in the world with Dubai ranked 3rd in the list of cities having the highest number of LEED-certified buildings. UAE has more than 600 LEED-certified projects.

2. Supportive Government Policies

UAE has launched the Net-Zero by 2050 Strategic Initiativeto reduce carbon emissions and will invest over AED 600 billion in renewable energy to minimize carbon emissions and move the nation towards cleaner energy. 

Other initiatives launched by the UAE to reduce carbon emissions which will increase the sales of green properties include –  UAE Vision 2021, the UAE Centennial 2071, and the UAE Energy Strategy 2050, which sets a 50% target for clean energy in the country, among others. The UAE government has already established several sustainable development goals which serve as a guiding principle for most upcoming real estate projects in the region.

3. Lower Construction & Operational Cost

Research conducted by the World Business Council for Sustainable Development (WBCSD) reveals that the cost of installing green building features and technologies is significantly overestimated. Many developers perceive that the upfront cost of a green building is, on average, 17% higher than the original cost of a similar traditional building, however, that’s not true. 

The research by the U.S. Green building Council (USGBC) reveals the initial cost of a green building is only 2%-3% higher than its non-green counterpart. Moreover, green buildings consume 25%-35% less energy than non-green buildings and have 14% less operation and maintenance costs than their traditional counterparts. 

Modern property owners also prioritize renting or leasing green buildings or apartments due to their cost benefits. Green buildings also allow developers to save 20% of the initial construction cost annually by reducing energy consumption. Furthermore, green buildings allow developers to complete large-scale green projects at a much larger scale resulting in more revenues and business expansion.

Using incentive technology such as Virtual Power Plants (VPP) combined with an onsite solar asset will further allow real estate developers to reduce the operational cost and utility cost and explore new models of maximizing income outside of increasing rent and making their properties more attractive for eco-friendly homes buyers.

4. Lower Rents & Service Charges

Green properties are a win-win situation for every stakeholder. Due to their lower construction cost and energy consumption, green buildings have minimal operational costs. This is indeed good news for the homeowners and tenants as lower operational cost of the building leads to a reduction in their energy bills, service charges, and rents.  

The lower service charges and rents often result in higher resident satisfaction and occupancy rate for the landlords and developers.

5. The rise in Environment-friendly Buyers

 Rising awareness about the adverse impact of emissions on the health of humans as well as on the environment has attracted a number of homebuyers toward green properties. This is encouraging real estate developers to construct more green properties to foster quick sales.

According to Khalid Bushnaq, CEO of Energy Management Services (EMS) “two years ago we had to convince property developers to go green and think about efficient energy. The majority didn’t know what ‘green’ meant and assumed there was an extra cost attached. Now developers want to go green and some are achieving Leadership of Energy and Environmental Design (LEED) certification, an internationally recognized green building rating system. Many large developers are creating their own green design guidelines to be followed by smaller developers building on their plot of land,” said Bushnaq.

There has been an exponential surge in buyers prioritizing green properties as they support a cleaner environment for future generations. 

6. Investors Prioritizing Greener Properties for Letting & Sales

There has been a rise in the investors and businesses prioritizing the green credentials of a property while making their purchase decision. This will indeed spur their saleability and rentability in the coming days. To cater to the demand of modern and environment-friendly buyers, real estate developers are coming up with greener properties and are evaluating the cost and the benefits of greenifying their portfolios.

7. Rising Sustainability Concerns

There have been rising concerns about sustainability among both residential & commercial clients. Corporates across the globe are showing great interest in going sustainable and prioritizing sustainable buildings for their offices.   

According to the 2nd edition of Knight Frank’s (Y)our Space report, “40% of firms have set a net-zero carbon target and, of those, 77% are aiming to achieve this by 2030. 87% of firms surveyed had less than half of their current global real estate portfolios either ‘green’ or ‘sustainable’.

Rising sustainability concerns among the buyers will accelerate the sales and rents of the green properties and will play a crucial role in minimizing the emission rate of the UAE.

Summary

Here is the summary of the article –

  • There has been a rise in the attractiveness of greener properties among buyers across the UAE to reduce carbon emissions and move towards a healthy lifestyle.
  • Climate change, COP 26, and UAEs investment in clean energy by 2050 have been the major drivers in raising awareness of green properties
  • Along with the residential, the commercial sector is also prioritizing moving their offices to green properties to prioritize employee’s safety and adapt to their occupational strategies
  • A Green building is a building that, in its design, construction or operation, reduces or eliminates negative impacts, and can create positive impacts, on our climate and natural environment.
  • The Knight Frank – 2021 survey on Middle East buyers reveals that proximity to green space and good air quality topped the list of location features. Half of the respondents considered the energy efficiency of their next home to be a ‘very important’ issue, compared to 42% of global buyers.
  • UAE is ranked 14th in the world with 869 green-rated buildings
  • The top reasons for the rising demand for green properties are as follows
  • Increasing awareness
  • Supportive government policies
  • Lower construction & operational cost 
  • Lower rents & service charges
  • Increase in environment-friendly buyers
  • Investors Prioritizing Greener Properties for Letting & Sales
  • Rising sustainability concerns among the buyers

Why Should Investors Buy Land in Metaverse?

‘Metaverse’ has become one of the biggest buzzwords of the 21st century. The rising popularity of blockchain applications has been one of the major reasons behind the conquest of Metaverse.  The term has become so popular that Facebook’s CEO –  Mark Zuckerberg changed Facebook to Meta–which is an attempt to usher in the metaverse, a new world of built-in virtual reality. Many wonder about the origin of the ‘Metaverse’. The terms first came into the limelight in Snow Crash – a book by famous author Neal Stephenson in 1992. The book was a science fiction which turned out to be a cornerstone in the development of digital platforms.

There has been an exponential surge in the number of blue-chip & Fortune 500 companies buying property in Metaverse as it empowers them in reaching out to new customers. 

Some of the examples of top-notch companies that have bought virtual land at metaverse are as follows –

What is the Metaverse?

For those who are hearing this term for the first time, the metaverse is a digital space where users can communicate and move virtually in their three-dimensional avatars or digital representations. It is expected to be the future of business and human interaction. 

Metaverse is composed of virtual worlds which consist of real estate segments called parcels. The platform allows users to purchase and sell parcels using the Metaverse platform’s currency. Metaverse is based on the principles of augmented reality and merges physical and virtual existences in a shared online space.  The rising popularity of Metaverse has encouraged global corporations from Microsoft to GUCCI to invest in these platforms to elevate the user experience and foster sales.

How do Real Estate Investors Buy Land in the Metaverse?

The most effective way to buy land on the metaverse is through cryptocurrencies. Some of the popular cryptocurrencies used by the investors include – Ethereum, the Sandbox (SAND), and MANA (connected to the community-based Decentraland platform). SAND & MANA have always been the preferred choice of the investors when it comes to owning online land and property due to its established infrastructure. Investors can purchase land directly on these platforms. The sales & ownership of metaverse land are maintained via. transfer of non-fungible tokens (NFTs) in a wallet capable of storing these. Some of the most preferred wallets today include – Binance and Metamask. Investors can either buy them directly from the platform or they can choose to purchase them from third-party resellers’ markets.  Opensea.io and nonfungible.com are some of the most popular third-party reseller platforms who act as decentralized estate agents for the digital domain. These platforms allow sellers to list their property & prices and facilitate buyers in negotiating. 

According to an article by CNBC, the last few years have witnessed an exponential rise in investors buying land in Metaverse. Metaverse has completely revolutionized the way real estate used to operate. Not only real estate investors, but lenders and mortgage providers are lining up to make the most of this opportunity and buy digital real estate.

Top Reasons to Buy Land in Metaverse

Here are the top 7 reasons for the real estate investors to invest in virtual property in the metaverse

1. Allows a Large Number of Buyers to Invest

Unlike the actual real estate world, Metaverse allows everyone to invest in Metaverse land. The land parcels are available on various platforms at different prices based on their size, shape, and location. Metaverse allows buyers to set up a cryptocurrency wallet based on their preferences and start investing in global real estate. Metaverse also makes it possible for small investors to buy land by allowing them to purchase micro land parcels based on their affordability.

2. Higher Returns 

 Buying virtual land on metaverse might cost exactly like real land however returns on investments are multifold higher than in the real world. There are instances where investors have enjoyed returns up to 1000% in a very short period of time.

3. Countering Real estate Malpractices 

Metaverse is powered by blockchain technology which makes it impossible for any third party to occupy the land illegally or perform any type of land scam.  Every transaction at metaverse is recorded in a blockchain ledger which makes the entire process of buying land and registry more transparent. This overcomes any possibility of common real estate frauds such as – delays in possession, forced cancellation of land, selling land without authorization, and making fake promises to name a few.

4. Stable Source of Investment

Stability is the most important factor which makes Metaverse an ‘apple of an eye’ of global real estate investors. Buying land in Metaverse allows the investors to use it for multiple purposes such as: constructing a house or an office space. Investors can also buy land in the metaverse for investment purposes as well. However, like any other investment, investing in the metaverse is also subjected to risks. There is no assurance that the value of the land will only go up. However, the data suggests that prices of a parcel of land in the metaverse have increased at an exponential pace. When Decentraland held its first LAND auction at the Terraform Event in December 2017, a parcel of land cost merely US $20. Those parcels sold for an average of over US $6,000 in 2021. By the start of 2022, the prices have skyrocketed to approximately US $15,000 per LAND token. The average prices have increased by a factor of 10 over the past year. There has been a huge proliferation in the interest of the investors in buying digital land as they consider it a stable source of investment which won’t lose its value drastically anytime soon like any other investment despite current economic downturns such as – the Covid-19 or the Russia-Ukraine war. Investors are also banking on buying-to-let options as well to take advantage of the thriving rental market.

5. Size & Location of Land Holds the Upper Edge over Utility

In the ideal scenario, the investors prioritize the utility factor of the land over its size or location. However, in the case of digital real estate, it’s another way round. The real utility is the least priority of the investors as they will never inhabit the land or visit it in person. The primary objectives of buying land in Metaverse are either to develop it or to lease it out to a third-party entity. Thus, size & location become key factors compared to utility. In the last few years, there has been a surge in the number of real estate developers and tech developers looking to build master communities which are equipped with ultra-modern facilities such as – clubs, schools, and high-end restaurants whilst living in the metaverse. Taking it to a new level, a list of real estate developers in the US have unveiled a one-to-one metaverse replica on an augmented reality platform to complement the physical town

Technology companies and real estate developers are joining hands to build virtual cities. Recently, an Indian firm – Lepasa created virtual cities in Metaverse and plans to create 15-20 different cities over 416 sq km, with each city having a different theme.

6. Easy to Secure Loans

Another reason to embrace buying land in the metaverse is it is easy to secure loans. Loans are given easily through a multi-blockchain network which facilitates faster liquidity deployment at a far lower cost. Decentralized finance (DeFi) is the only entity which facilitates money lending or borrowing of a cryptocurrency against collateral. In the metaverse, the collateral is a Non-fungible token (NFT). DeFi allows anyone to borrow crypto assets without requiring KYC documents or performing a credit check. It is highly secured and is automated through smart contracts.

7. Convenient to Host Community Events and Commercial Activities

Buying a digital land at metaverse also opens an opportunity to host real-world events such as: community events, workshops, exhibitions, trade shows, and social gatherings. Attendees can attend these events from the comfort of their homes. Several companies have used metaverse to host events. DAMAC Properties is also in the process to build a novel Metaverse project, featuring numerous brand collaborators such as Paramount Hotels and Resorts, Fendi Casa, Cavalli, Radisson, Versace Home, The Trump Organization, and Rotana. Dubai has also hosted the world’s first-ever economic summit on Metaverse in March 2022.

Summary

Here is a short recap of the top 7 reasons for real estate investors to invest in Metaverse

  • Allows a Large Number of Buyers to Invest
  • Higher Returns 
  • Countering Real estate Malpractices 
  • Stable Source of Investment
  • Size & Location of Land Holds the Upper Edge over Utility
  • Easy to Secure Loans
  • Convenient to Host Community Events and Commercial Activities

A Quick Analysis of the Real estate sector’s performance in Q1, 2022

Dubai’s real estate sector is alluring the attention of global investors and surpassing its previous milestone every year. This is very evident from the substantial rise in property prices and primarily rental value. Expo 2020, Masterplan 2040, and the successful handling of Covid-19 have resulted in an influx of expats investing in Dubai’s real estate or starting a business in the city which led to an increase in the rental value of both residential and commercial property. 

Successful handling of Covid-19 has attracted the world to Dubai which is very evident from the latest report by the Dubai Statistics Centre which confirms that Dubai’s population crossed the 3.5 million mark as of April 2022.

Substantial Increase in Rents for Apartments & Villas 

According to a report by CBRE titledDubai Residential Market Snapshot April 2022’, the average rent for the property in Dubai has increased by 13.1% in the last 12 months. The average rent for apartments as of April 2022 surged 11.7% compared to the previous year. Villas surpassed apartments in terms of rent increase and witnessed a rise of 22.5% compared to 2021. The average annual rent for an apartment is AED 80,000 and the rents for Villas stood at AED 238,441.

In Downtown Dubai and Palm Jumeirah, in the year to March 2022, the average rent for an apartment increased by 29.4% and 39.6% respectively. Over this period, average villa rents in Emirates Hills, Jumeirah Islands, and Palm Jumeirah increased by 9.3%, 31.3%, and 36.7% respectively. In the year to date to March 2022, new supply delivered in Dubai totaled 7,812 units, with an additional 56,871 units scheduled to be delivered in the remaining three quarters of the year

According to the CBRE Report, Palm Jumeirah and Al Barari were at the pinnacle in terms of an increase in the rents. The average asking rent at Palm Jumeirah was AED 197,482 and AED 801,940 at Al Barari.

Which Areas Witnessed Increase in Rents? 

Apartments

According to the CBRE Q1, 2022 report, the areas where the rents for the apartments increased at the fastest pace in the first quarter of 2022 include Business Bay (4.9%), International City (4.2%), Dubai Marina (4.1%), Damac Hills (4.1%), Palm Jumeirah (3.9%), The Old Town (4%), Jumeirah Beach Residence (3.5%), Downtown Dubai (3.3%), Sports City (3.2%), and Jumeirah (3.1%). 

The areas where the rents for the apartments witnessed a steep decline include Liwan (-0.9%), Bur Dubai (-0.6%), and Arjan (-0.4%).

Villas

In terms of Villas, the areas where rents increased the most in Q1, 2022 include Jumeirah (4.8%), Sustainable City (4.8%), Emirates Hills (4.7%), Arabian Ranches (4.5%), and Damac Hills (4.5%). 

The areas where rents for the villas witnessed a decline include – Deira (-1.9%), Jumeirah Park (-1.6%), Reem (-1.2%), and Al Furjan (-0.4%).

Upswing in the Property Prices

The CBRE Q1, 2022 report reveals that the average prices for the property increased by 11.3% in the year to March 2022. Over this period, the average prices for the apartment increased by 10% and 20.2% for villas. As of March 2022, the average prices for an apartment were AED 1,118 per square foot and the average price for a villa was AED 1,267 per square foot. 2014 was one of the best years for the real estate sector. Compared to 2014, these rates per square foot are 26.2% and 12.3% below the peak, for both apartments and villas respectively.

In the apartment segment, Downtown Dubai witnessed the highest average sales rate per square foot of AED 2,021 while Palm Jumeirah was at the top in terms of villas segment where the highest average sales rate per square foot stood at AED 2,910.

Transaction volumes in Q1 2022

Dubai’s residential market is breaking records everywhere and transaction volumes are not an exception.  According to the CBRE Q1, 2022 report, the total volume of transactions reached 19,009 in the first quarter of 2022 which was the highest figure ever recorded in the first quarter of the year.

Only in the month of March 2022, Dubai’s residential market witnessed a total volume of transactions reaching 7,865 which was an 83.4% increase from the previous year. Over this period, off-plan sales increased by 94.6 % and sales in the secondary market increased by 76.1 %.

Forecast

The rents in mid-market and affordable segments are expected to rise in the coming quarters while rents in luxury or premium real estate will consolidate and they have reached their highest mark since 2020. Expo 2020 has played a decisive role in fostering the demand for luxury real estate however as the grand event is over now most of the Expo-related demand has ended. 

Dubai witnessed a colossal increase in the number of expats moving to the city due to strict Covid-19 related restrictions in their home countries. However, as the pandemic situation is normalizing, Dubai is likely to witness a large number of affluent expat buyers moving out of the city to their home nations which can adversely impact the demand for luxury real estate. However, overall Dubai real estate will benefit from an increase in the number of new expats taking jobs in Dubai which will boost the demand for affordable residential property. The current and upcoming free zones in Dubai will attract several new entrepreneurs to start new businesses in the city. Dubai issued 72,152 new business licenses in 2021 and in Q1, 2022; the new business licenses already reached 24,662 which is an increase of 58% y-o-y. The upcoming new businesses have created more demand for office space which will boost the demand for commercial real estate. At Business Bay, average rents have increased from AED 76 per square foot to AED 101 in these last 12 months. The rents for Grade-A offices in Dubai have increased 30-40%. The establishment of new businesses will create more demand for accommodation and will further boost the demand for apartments and villas in the coming months. This is indeed ‘a glad tidings’ for Dubai’s residential real estate.

Top 10 Ways Blockchain is Revolutionizing the Operations of the Property Management Sector

Blockchain technology has been the cornerstone behind revolutionizing the Property Management (PM) sector. The impact of blockchain is felt in every aspect of property management – right from due diligence to streamlining the transactions to resident satisfaction.  Blockchain is driving digital transformation in the property management sector by introducing ‘pen and pencil’ businesses (which are highly reliant on archaic methods) to the contemporary ways of maintaining the record of business transactions. Blockchain is a decentralized record-keeping technology which is designed to bring more transparency to digital transactions. It provides a form of shared record-keeping which is almost impossible to tamper with. Blockchain functions through decentralized peer-to-peer platforms which build resilience against the spread of corrupted information and boost resistance to fraud. Blockchain aims at recording and distributing the digital information and ensuring it doesn’t get edited. Blockchain ensures that immutable ledgers or records of transactions cannot be altered, deleted, or destroyed through its advanced distributed ledger technology (DLT)

The use of blockchains has exploded with the creation of various cryptocurrencies. A cryptocurrency is an encrypted data string which denotes a unit of currency. It is monitored and organized by a peer-to-peer network and serves as a secure ledger of transactions like buying, selling, and transferring. Cryptocurrencies are decentralized and cannot be issued by governments or other financial institutions. Cryptocurrencies are created and secured through cryptographic algorithms and are maintained in mining where a network of computers or specialized hardware like Application-specific integrated circuits (ASICs) process and validate the transactions. 

The Implementation of Blockchain in the Property Management Sector

Like any other industry, the Property Management sector has also not been able to escape the blockchain disruption. Before the introduction of blockchain, a vast majority of business transactions (related to rents & service charges) used to be conducted offline involving face-to-face engagements with various entities. However, blockchain has played an integral role in shifting the PM sector towards digitalization with the majority of residents today making the payment using digitized portals. The introduction of the blockchain allows the property management sector to effectively market their managed properties by listing them online and connecting with the right potential tenants and homeowners. As per the report by Deloitte, the new platforms can eventually assume functions such as listings, payments, and legal documentation are cutting out the intermediaries and will allow both buyers and sellers in saving on commissions and fees charged by these intermediaries. This also makes the process much quicker as the back-and-forth between these middlemen gets cut. This will minimize the cost of operations for the property management sector several folds and will have a profound impact on the occupancy rate and reputation of the property.

Real estate Giants benefitting from Blockchain Implementation in their operations

Some of the examples of Real estate companies who have embraced blockchain are as follows – 

Here are the top ways in which Blockchain is revolutionizing the operations of the Property Management sector

1. Transparency

Blockchain has made operations more transparent and has fostered more trust. With the implementation of Blockchain, it has become very easy for property management firms to track all business transactions and documents in a few clicks on blockchain-enabled platforms. Blockchain offers a verifiable and censorship-resistant option that allows property management firms in maintaining the confidential information of the residents and conducting swift verification of their submitted documents to build a more transparent environment. Furthermore, Blockchain also brings transparency to the transaction processes by overcoming the need for wire transfers which take days to process and are costly-affair too.

2. Smart Contracting

Property Management is far more complex than many think. It’s way beyond maintaining a property or upgrading the appliances. Today, property management firms deal with a vast range of services & functions which involves processing hundreds of documents every day such as: lease agreements, maintenance requests, service charge invoices, listing agreements, offer sheets, closing documents, letters of intent, and resident verification documents to name a few. 

Blockchain empowers property management firms with a single decentralized property management system to convert all the bulky paperwork into smart contracts. This allows property management firms to fetch quick insights on prevailing rental values, tenant history, property details, payment frequency, and contractor agreements and also in reducing their paperwork significantly. Signing smart contracts over paper contracts also streamline the transaction process and overcome the need for negotiation with the stakeholders to accelerate the speed of the process. It also makes the process more transparent and secure.

A smart contract is a self-executing contract which outlines the terms & conditions of the agreement between two parties. Blockchain allows property management firms to write terms of the contract into lines of codes which are stored across a distributed and decentralized blockchain network. It also assists property management firms in easily monitoring the execution of the contract and in tracking the transactions conveniently.

3. Issuing Possession Documents & Countering Frauds

Blockchain portals have also made it much easier for property management firms to issue the possession documents of the property to the homeowners and provide them with an authenticated proof of purchase or sale of a property with valid evidence of ownership, exchange, and transaction. Blockchain has also enabled property management firms in countering instances where an illegal owner tries to occupy the property by producing false documents through its functionality of uploading the title documentation on the blockchain network. This functionality also allows the property management firms to easily view the documents and conduct swift verification of the homeowners and hand them over all the related- documents which make them feel that they are proud owners of the property.

4. Minimizing the Number of Intermediaries

The role of blockchain has been instrumental in minimizing the number of intermediaries such as: brokers, agents, escrow firms, etc. in the property sales process. The report by Deloitte titledBlockchain in commercial real estate: The future is herereveals ‘brokers, lawyers, and banks have long been part of the real estate ecosystem. However, blockchain may soon usher in a shift in their roles and participation in real estate transactions. New platforms can eventually assume functions such as listings, payments, and legal documentation. Cutting out the intermediaries will result in buyers and sellers getting more out of their money as they save on commissions and fees charged by these intermediaries. This also makes the process much quicker as the back-and-forth between these middlemen gets cut.’

Blockchain facilitates property management firms in storing and transferring the records of the residents on their platform which leads to a significant reduction in the processing time and cost for them.  

5. Assists in Leasing & Payments

Blockchain assists the real estate & property management sector in the leasing process. Distributed ledger technology allows leases to be signed as well as paid on-chain in real-time. This automates dividend and rental payments to property owners and also overcomes the need for manual reconciliations. Furthermore, smart contracts assist the sector in the automatization of different types of remittances and fees.

6. Countering Sub-leasing and other Fraudulent practices

Today the vast majority of property listing services are privately owned and lack a centralized database for cross-referencing. Due to the lack of decentralization of property listing information, property managers face a real tough time in stopping tenants who are posting the advertisements for their units for sub-leasing. However, with the help of Blockchain platforms, property managers can now easily counter the tenants who are illegally subletting their property or units and violating the terms of the contract. 

Blockchain-enabled property listing platforms have emerged as a panacea for the property managers as they automatically flag the illegal listings and allow property managers in tracking the tenants sub-leasing their property. Moving the property listing to a single decentralized blockchain-based server enables property management firms in creating a unified database which is accessible to every stakeholder. Blockchain allows potential homeowners to purchase property and make investments using decentralized finance or DeFi services.  Furthermore, as data is monitored and stored securely, it is nearly impossible for any third party to inflate the price of the property or post any fraudulent information.

7. Overcoming  Siloed Databases

Blockchain-enabled platforms also facilitate property management firms in reducing siloed databases by securing the data in tamper-resistant shared databases which compile & store all the relevant data in one place which can be accessed in a few clicks to make the process more transparent.

8. Facilitating Real estate transactions 

Blockchain has played an integral role in streamlining real estate transactions on trading platforms and online marketplaces. This has empowered both the real estate & property management sector in exploring novel ways to trade assets. Digital trading platforms like ATLANT tokenize properties and assist in online trading and in exchange the tokens for fiat currency. 

9. Simplifying Rent Collection Process

Blockchain platforms have completely revolutionized the process of rent collections for property management firms. Blockchain-enabled platforms automatically send alerts to the residents whose rent or service charge payments are pending. Blockchain-enabled platforms also facilitate property management firms in calculating and billing the service charges in real-time based on the data collected through IoT devices and electricity consumption records. This minimizes the time consumed in calculating service charges and other payments 

In the coming years, there will be a rise in property management firms embracing blockchain-enabled platforms for rent collections due to the increasing popularity of Bitcoin & Dogecoin as a mode to make service charge payments in Dubai as well as across the globe. In 2021, Samana developersa leading real estate developer in Dubai started receiving all the payments in Doge coins for its residential project in Jumeirah Village Circle. This will encourage several property management firms to implement blockchain-enabled platforms to maintain these transactions.

10. Creating Memorable Experiences for the Residents

Blockchain allows property management firms in exploring novel ways to enhance residents’ experience. Using blockchain-enabled platforms, property management firms are tracking useful data to understand the residents’ expectations to make their managed communities attractive and improve the occupancy and satisfaction rate. Blockchain-enabled platforms also provide information on residents’ preferences to the property managers to make their services personalized without compromising the data security.

Summary

The top 10 ways in which Blockchain applications are empowering the property management sector in streamlining its operations are as follows –

  1. Transparency
  2. Smart Contracting
  3. Issuing Possession Documents & Countering Frauds
  4. Minimizing the number of intermediaries 
  5. Assists in Leasing & Payments
  6. Countering Sub-leasing and other Fraudulent practices
  7. Overcoming  Siloed Databases
  8. Facilitating Real estate transactions
  9. Simplifying Rent Collection Process
  10.  Creating Memorable Experiences for the Residents

How is Dubai Planning to Use the Expo Site?

As the biggest grand event is coming to an end there is curiosity in the mind of everyone about the future of the Expo 2020 site and how Dubai will use it post March 31, 2022. Being a frontrunner in business, the Dubai government has well-thought plans to use every component of the Expo site for the greater good of Dubai and the UAE. 

The UAE government is in the process of converting the Expo site into a city for the next generation of entrepreneurs.  It is working on developing a strategic innovation policy to offer a wide gamut of Free Zone incentives and attract the best talent from across the globe to start a business. Commenting on the future of Expo site, Tala Al Ansari, Director, and Head – Innovation ecosystem & Scale2Dubai, Expo 2020 said – it offers entrepreneurs and start-ups a platform for ease of set up and scale. Its pro-business regulatory environment and global logistics power mean entrepreneurs can go from licensing to launch, at pace with a strong network of incubators and accelerators ready to support.”

Let’s find out how Dubai is planning to use each component of the Expo site post-March 31, 2022:

1. ‘Temporary Pavilions’ to be transformed into Word-class Infrastructure

There are two types of pavilions at Expo 2020 – Temporary pavilions and Legacy pavilions. A large number of countries like the US, Russia, and China have temporary pavilions at Expo 2020. Temporary pavilions are the pavilions created by those nations who have leased them on an ad-hoc basis. Post-completion of Expo on March 31, 2022, the government will tear them down and use the space to develop – District 2020 – an area studded with world-class & unconventional offices, commercial complexes, and residential properties. 

2. The Legacy of the ‘Legacy Pavilions’ Will Last for Long

The lifetime of the Legacy pavilions will be extended post-completion of the Expo. According to Anoosha Al Marzouqi, Director at the Opportunity Pavilion – “Nearly 80% of what the Expo has built will remain in legacy,”. The ownership of Legacy pavilions will either be in the hands of the nations who have established them or with the Expo 2020 organizers. Legacy pavilions will always have a place on the Expo site even as a new satellite township begins taking shape. Some of the popular Legacy pavilions at Expo 2020 include – The Mobility, Sustainability, and Opportunity pavilion. Countries which have legacy pavilions include – the UAE, Saudi Arabia, and India.

3. Legacy Structures

Legacy structures are buildings different from pavilions and were constructed to fulfill the utility and commercial requirements of the Expo. The government has plans to make them serve as a way for the new offices and homes. Some of the popular legacy structures which will stay permanently include – Saudi Arabia’s pavilion and Al Wasl Dome. To meet the entertainment requirements, AR Rahman’s brand-new musical project in Dubai, the Firdaus Studio will continue to remain the legacy structure. Expo’s Rove Hotel will cater to the hospitality needs of the area post-completion of Expo 2020.  One of the biggest tourist attractions of the Expo 2020 – ‘Gardens in the Sky’ will also continue to remain as a legacy structure.

4. Construction of ‘District 2020’ to Boost Employment

District 2020 is referred to as ‘the future of Expo 2020 site’. This ‘one-of-its-kind’ area will be developed to support the future of working and living and facilitate connection and collaboration. District 2020’s master plan reveals the plans to build a vibrant urban environment with 100s of residential areas, co-working hubs, and green spaces to accommodate over 145,000 people at full capacity.

District 2020 will be the home to Fortune 500s, SMEs, start-ups, entrepreneurs, and innovators. It will play a decisive role in supporting businesses of all kinds. Around 80 % of the Expo-built structures at the 4.38 sq km site will be repurposed to transform it into a 15-minute futuristic, human-centric city where people can work, live and explore. While District 2020 is the name of the Expo site, it will be transformed into a residential and commercial community called the 15-minute city’.

According to Tala Al Ansari we have received over 3200 applications for startups from 129 countries around the world. 628 (companies) have been shortlisted, and the first cohort of 85 scaleups from 27 countries around the world will join us at District 2020,”  She further said – ‘These 85 startups will receive a soft landing at District 2020 and will become part of our innovation ecosystem,” 

District 2020 will be a boon in supporting Dubai’s current and future growth ambitions and has been identified as the fifth urban center in the Dubai 2040 Urban Masterplan. As of now, District 2020 has already attracted some of the world’s leading industrial, tech and logistics giants, including Siemens, Siemens Energy, Terminus Technologies, and DP World.

5. ‘Scale2Dubai’ Initiative to Accelerate the Growth of District 2020

Scale2Dubai initiative is launched to provide an incredible opportunity to start-ups & small businesses from across the globe to expand within the District 2020’s ecosystem. It is a beguiling opportunity for the companies to scale their business in Dubai by capitalizing on the partnerships formed during the six-month Expo 2020 Dubai. 

Scale2Dubai is launched to carry forward the Expo 2020 vision of gathering global minds and promoting diversity, innovation, and knowledge-sharing within District 2020. This programme is focused on attracting startups or businesses in the early stages of growth from key industries such as: Travel & tourism, transport & logistics, education, and construction.

Focus on Technological Development

Scale2Dubai programme will lay special emphasis on the technological development of Dubai and target businesses focused on disruptive technologies like – the Internet of Things (IoT), Big data, 3D printing, Artificial Intelligence (AI), Robotics, Blockchain, and any other advanced technologies to ensure Dubai thrive in the area of technology & innovation. Scale2Dubai initiative will focus on key sectors like – Smart Cities, Smart logistics, Smart mobility, and Industry 4.0.

‘Scale2Dubai’: Key highlights

  1. Two years Free Workspace
  2. Two years visa
  3. Business Set-up
  4. Community Lifestyle
  5. Two years of subsidized urban living
  6. Access to special rates for service providers
  7. Equity free programme
  8. Opportunity to attend Social & Networking events
  9. Opportunity for small businesses to connect with big corporations operating in District 2020 who can assist them in their growth and lead their business

Summarizing my Two-years as ‘Kaizener’

Author: Aditya Rawat

As they say, all good things start with a decision to try. Applying for the job of Author & Client Nurturing Officer at Kaizen AMS was one of those things for me. It is a decision which I have always cherished and will cherish in years to come.

The term Kaizen is derived from two Japanese words ‘Kai’ & ‘Zen’ which means ‘continuous improvement’. It is something which is clearly evident in each of its processes & functions. This approach of continuous improvement is the reason why Kaizen has some of the biggest brands in its clientele. The vast amount of credit of this success goes to its expertise, excellence, credibility, trust, and above all efforts to achieve.

So let me share my experiences with Kaizen AMS and what makes it so great.

1. Efficient Interview Process

At several top-notch consulting and management firms’, the interview process is very lengthy and lasts between 6 to 12 months. The primary reason for such a lengthy interview is every single stakeholder wants to evaluate the candidate on all the required skills. However, I can say from my experience, when organizations follow such a lengthy interview process they run a risk of losing many potential candidates as they get hired by some other company during the interview process. Thus, it’s always wise to have a shorter interview process. 

My entire interview process at Kaizen AMS lasted for just 7 days. 3 rounds of interviews and I got an invitation in the form of an ‘Appointment letter’ to be a part of the thriving Kaizen Family.

I firmly believe that the interview process is not only the test of the skills of the interviewee but the interviewer too. The interview process also puts the skills of an interviewer to test on how quickly he/she can judge whether a candidate is a right fit for the organization. Undoubtedly, Kaizen AMS gets a ‘perfect ten’ on this parameter.

2. Employee First Approach

To build a happy clientele, you must have happy employees first as they are the ones who serve your clients. Until the employees are satisfied with what they are doing, they can never make the clients happy. 

The ‘Employee First’ approach is embedded in the culture of Kaizen AMS. The company always puts its best foot forward when it comes to employee satisfaction. The best example I can share is even at the time of economic slowdown in 2020 due to Covid-19,  when companies of all sizes were performing layoffs at a vast scale, Kaizen AMS didn’t lay off any employees due to poor business climate. The company forecasted the economic slowdown well in advance and was well-prepared for it even before the first lockdown was exercised. Thanks to the wisdom and expertise of its visionary leadership.

Unfortunately, it is a common adage of the global corporate sector that layoffs are the easiest way to cut costs, however, that’s not true. The companies spend millions of dollars in the name of Corporate Social Responsibility (CSR), building brand image, marketing, etc. to look ethical in the eyes of the clients, investors, and all stakeholders, however, they lose it all in no time when they perform layoffs as it spreads a bad name about the company in the industry. Furthermore, when the market returns to normal, these companies find it challenging to attract fresh talent as no employee will be interested in making a career with a company with an unstable future. 

From my experience, I can say, trust is the foundation of every relationship, be it personal or professional. Layoffs also hurt the confidence and productivity of the entire workforce as they also work in the fear of losing their job which is detrimental for the productivity and the business of a company. Kaizen AMS’ leadership understands the value of the employees and tries to save the cost through automation, implementing innovative techniques, and adopting the best industry practices rather than resorting to layoffs.

3. Strategy is not Confined to the Head honchos

In most of the world’s leading corporations, the strategy revolves around only the C-level executives, VPs, and Directors. However, that’s not the case with Kaizen AMS. The company firmly believes that talent has no boundaries and a good idea can come from any part of the organization. Kaizen involves each employee while designing the company’s strategy. 

When I joined Kaizen AMS, I was excited to learn that the company encourages all good ideas and practices coming from every part of the organization. Mr. Fadi Nwilati organizes brainstorming sessions on a bi-weekly basis to listen to the ideas of every team member and provides quick approval as well as his expert opinion on how to go about it.  This makes employees feel more inclusive and privileged that their opinion really matters. This approach also makes ‘Kaizeners’ more dedicated towards their role. 

From my experiences, I can say with utmost confidence that one of the biggest secrets behind Kaizen’s monumental success in a very short span is its culture of welcoming new ideas. Unlike many top corporations where work is more or less repetitive and pre-decided, Kaizen says an absolute “No” to the repetitive tasks and automates them to let technology take care of them. Kaizen’s top leadership always encourages employees to come up with creative deliverables and ideas every day which can have a profound impact on business. This culture always keeps employees continuously engaged and makes the work fun which an employee always cherishes. I have a long list of deliverables which I proposed to the Kaizen’s leadership and explained to them the reason why they are important for the company and their business impact and got immediate approval to work on it. This culture of encouraging creative ideas has not only worked well for the employees and the company but also for the residents living at Kaizen-managed communities. 

4. Transparency

Every company makes a last-ditch effort to build a transparent environment with no scope of politics, negativity, red-tapism, or any sort of discrimination. However, it’s a no-brainer that usually the reality is completely opposite at the ground level. It is always a hard nut to crack for many companies to execute the best practices in every department or team. Furthermore, things become worse as most of the employees hesitate to complain about discrimination or intolerant behavior with the leadership due to the fear of repercussions or losing the job. 

It was exciting & overwhelming for me to learn that Kaizen has a very open & transparent system of Townhall meetings where all employees can raise their problems or challenges they are facing directly with Fadi Nwilati, and Sara Nwilati – Head of Talent. One best practice which I have learned from these town hall meetings, something every organization can practice, is to keep the identity of the grievance raisers secret to foster the culture of transparency.

Being an industry leader with over three decades of management experience, Fadi understands it’s not always a cakewalk for the employees to raise their issues or complaint. Many fear that it can backfire. To overcome this situation, Fadi asks every employee to submit their queries & concerns through an anonymous platform before the town hall meetings begin and answer them accordingly. This way the identity of the employee remains discrete and their grievances get resolved without any hassles. I think this is the best way many organizations can practice to build a transparent and discrimination-free environment. This practice also discourages the wrong-doers as they know the leadership is just a Slack or mail away from the employee.

5. Teamwork

In today’s corporate environment of remote working, the concept of teamwork is losing its ground. Thankfully that’s not the case with Kaizen. Every employee at Kaizen is strongly committed to the betterment of the team. I can share one example. 

Last month, I had to write a Whitepaper on how each team at Kaizen uses PropTech to the best of their advantage. Writing this Whitepaper required coordination from eight different teams at Kaizen which looked like a ‘mountain to climb’ to me at the first sight due to their busy schedule. However, when I pinged the mentors of these eight teams on Slack to schedule a call with me, I got an immediate appointment for a meeting.  The entire process of meeting and capturing the required information took less than 2 hours and I was ready to write my next Whitepaper. Now, that’s what I call True Teamwork. The task which was a ‘mountain to climb’ for me earlier became a ‘walk in the park’ due to the support I received from every ‘Kaizener’. This reflects the robust commitment of every ‘Kaizener’ towards the company’s growth & progression.

6. Loyalty

Many employers perceive monetary benefits, financial incentives, etc. as a viable tool to drive the performance of an employee; however, I believe that non-monetary incentives have far-reaching effects. A simple gesture of cooperating with an employee whenever he/she needs assistance, providing a platform to the employee to use creativity, and having faith in his/her capabilities, continuously motivates the employee to strive for better results. This approach has been more successful in driving optimum performance of the employee at Kaizen. I can vouch for my Line Manager – Mr. Jatin Babla as well as my teammates Mr. Eyad Alsaidy and Miss. Rim Salman for continuously supporting me whenever I approached them for any sort of assistance. The team’s continuous support and faith in my work drive my optimum performance at Kaizen.  

Final Words

This blog is just a small summary of my ‘memorable experiences’ with Kaizen AMS as an employee. In short, having faith in its mission & vision, having faith in the employees, continuously innovating and implementing the best practices to create a WOW experience for the employees, clients, and tenants, persistence &  problem-solving attitude and always working for the betterment of employees and stakeholders have been the real secret behind Kaizen success story. The adage holds true in the context of Kaizen that, – ‘Real-world doesn’t reward perfectionists, it rewards people who get things done’ and Kaizen has always been a pioneer in getting things done for each stakeholder.

Top 5 Ways Owner’s Committee Adds Value to a Community

It is the law of nature that with the passage of time the value of most things degrades and property is not an exception. Rising pollution levels and climatic conditions such as: heat and rainfall are also playing a key role in minimizing the life-cycle of a building. Thus, it is widely important for real estate developers as well as homeowners to ensure the property is well-managed to maintain its value. This creates an urge to hire an Owners’ association (OA) firm to manage your property to ensure it remains at peak performance and increases asset lifecycle.

What is an Owner’s Committee?

An owner’s committee consists of a group of individuals who act as the elected representatives of the property owners. As per  Law No. (6) of 2019 Concerning Ownership of Jointly Owned Real Property in the Emirate of Dubai, concerning the ownership of the jointly owned real estate in the Emirate of Dubai (the “JORE Law“), Owner’s Committees’ are responsible for overseeing the interests of the jointly owned property (JOP). 

Appointment and Eligibility

The Real Estate Regulatory Agency or RERA oversees the nomination of the Owner’s Committee Members for each JOP with up to nine owners as committee members who act as representatives for all the owners in the building or community. Each member has one vote while voting on the decisions of the Owners’ Committee. OC members come in odd numbers to ensure fair voting.

According to Article 22(c) of the New JOP Law, to become a member of the Owners’ Committee, an owner must have a full legal capacity and should be a resident of the project. He/she must have good conduct and have paid all of the service charges owing in respect of its unit. The owner must regularly attend and actively participate in the meetings of the Owners’ Committee. If the member of the Owners’ Committee fails to meet the criteria, he/she will not be eligible to be on the Owners’ Committee and the membership may be revoked by RERA. The New JOP Law directs the Owners’ Committee to meet on a quarterly basis with the first meeting to be held within the month from the date of formation.

As per the law, the developer can also be a part of the Owner’s Committee provided he owns unsold units in the project subject to RERA’s approval. 

Why Should you have an Owner’s Committee?

The Owners’ Committee plays a pivotal role in ensuring the highest standards of excellence in the maintenance and management of the building or community to drive the utmost satisfaction of the residents and owners.

Here are the top 5 ways Owners’ Committee Adds Value to a Community

1. Advisory

The owner’s committee offers recommendations to the Managing Agent on the best ways to manage and operate a building and ensure timely maintenance and upkeep of the common areas to optimize the value of the building. The owner’s committee is also responsible for reviewing the annual maintenance budgets of the JOP and provide their valuable suggestions.

2. Effective Complaint Management to Boost Resident’s Experience

The Owners’ Committee plays a key role in addressing the resident’s grievances by professionally handling the complaints in the JOP to the managing body. In case the managing body is unable to resolve the complaint within 14 days of being notified, the owner’s committee submits it to RERA. Thus, they assist in maintaining residents’ happiness.

3. Oversight and Compliance

The owners’ committee is also responsible for notifying the Managing Body or RERA of any defects or imperfections in the structural parts of the JOP or any gap in the jointly owned areas which requires immediate attention. Owners’ committee liaison with the management company to maintain utmost compliance with environmental laws and government guidelines pertaining to the maintenance of the JOP.

4. Appointment & Replacement of the Managing Company/Agent

The owners’ committee plays an important role in the selection, and appointment of the Managing Agent.  In case the Managing Agent’s performance is not in line with the expectations of owners or doesn’t meet a set standard benchmark, the Owners’ committee can submit a request for the replacement of the Managing Company to RERA. 

The key questions asked by the Owners’ Committee during the replacement process and prior to appointment:

Q1. Can you resolve the biggest issues faced by the Owners’ Committee? 

Q2. How can you reduce the annual service charges?

Q3. What are the actions taken against the owners for non-payment of service charges?

Q4. What differentiates you from other owners association management companies?

Q5. How can you add value to the building?

Q6. How can you enhance the Owners’ / Tenants’ experience?

5. Reporting

The role of the Owners’ committee is crucial in the process of overseeing the reports and verifying the work being carried out by the Owners’ Association Management (OAM) company as initially promised. They are the cornerstone in ensuring the work is being done in line with the standards to ensure utmost resident delight. 

Summary

Top 5 ways Owner’s Committee adds value to a community are –  

  • Recommending  the best ways to manage and operate a building to the Managing Agent
  • Complaint Management to Boost Resident’s Experience
  • Liaisoning with the management company to maintain utmost compliance with environmental laws and government guidelines
  • Appointment & Replacement of the Managing Agent  
  • Overseeing the reports and verifying the work being carried out by the Owners’ Association Management (OAM) company