Anticipation for the World Expo 2020 and as part of the UAE blueprint for 2021, the Dubai real estate sector is witnessing an increase in joint ventures between foreign real estate players and local land owners for new projects. These joint ventures are proving to be highly beneficial for those land owners who do not have any idea on how to monetize their land. In Dubai, joint ventures between local land owners and global builders can be done through a legally binding entity and consolidated JV. Under the latter structure, another organization is created by the two parties locally. This helps in simplifying arrangements and getting necessary approvals from agencies like the DLD.
LLCs can be set up through 51% and 49% can be the local and outside shareholdings respectively. JAFZA or DMCC seaward organizations can be set up with up to 100% shareholding for foreign entities as well. Experts feel that the real estate sector in Dubai will get a major boost from such joint ventures and it will help in unlocking greater value for land owners, particularly in emerging and suburban areas which have huge development potential in the run-up to the 2020 Expo.
The Government is also taking constructive steps to increase and encourage foreign investments and it is only a matter of time before multiple real estate projects start coming up as JVs between local entities and foreign players or even global builders and local land owners. This will help revitalize the realty market in Dubai which has been seeing mixed trends in recent times.