In the final episode, financial services expert Gautam Mohanty looks at how focusing on multi-use properties that cater to diverse investment appetites has set Dubai Investments apart.
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00:00Hello and welcome to the final episode of Investing in the Future, a three-part podcast
00:19series by Golf News that will take you on a journey into the world of one of the most
00:23influential players into the economy of Dubai and the UAE, Dubai Investments. I'm your host
00:29Lachlan Kitchen. Dubai's transformation from a small fishing and pearling village into
00:34a bustling city is a remarkable story of visionary leadership and ambition. Images of luxury
00:40apartments, high-rises and million-dollar villas with private beaches are synonymous
00:45with Dubai's lavish lifestyle. While the real estate industry continues to set record prices,
00:51the success of the sector and the story of Dubai hasn't been possible without a relentless
00:56approach to a very bold ambition. According to Dubai's Statistics Centre, Dubai's population
01:02in 1995 was 680,000 and as of November 2023, it is 3.6 million. This exponential population
01:11growth isn't possible without a real estate vision and housing plan to help reinforce
01:16Dubai's position and attraction as a major economic hub. And as part of this vision,
01:22Dubai Investments has played a key role in the story of Dubai's success with real estate,
01:26a vital component in the company's diverse holdings. In this final episode, we'll explore
01:31the iconic projects Dubai Investments has been involved in. Our guest for this episode
01:36is again Gautam Mohanty. Gautam is a financial services industry leader with more than 20
01:41years' experience in banking, private equity and management consulting. Over the course
01:46of his career, Gautam funded a private equity media and entertainment fund and his track
01:51record of success extends across financial services, telcos, online marketplaces and
01:56real estate, where he advised multiple real estate startups on business strategies and
02:02their launch. Gautam, thank you once again for joining us on Investing in the Future.
02:07Thanks, Kitch. Really excited to be here. We opened the innings together. Happy to conclude
02:11it again.
02:12We'll finish things up very well. Good to see you. Gautam, the story of Dubai has been
02:16intertwined with some incredible feats of engineering, Instagrammable pictures of villas,
02:22just achievements that other countries are essentially envious of. But what role has
02:27Dubai Investments played in shaping the real estate sector and the skyline of Dubai?
02:32So Dubai Investments has contributed significantly to the Dubai real estate journey. They have
02:39some of the marquee properties, which have done well. They're not necessarily all Instagrammable,
02:43but have very high ROI and good investments. One of them is Dubai Investment Park. The
02:49second one is Merdif Hills, which is an upcoming exciting project. The Instagrammable property,
02:54which is Danaweh, which we spoke about last time, and Altaif Business Center. So these
02:59are across field. They're not just typical, your residential or commercial, but a mix
03:05of multi-use properties. So it's quite an exciting journey they've been on.
03:08Yeah, there's a lot of diversification in that. And that's what I want to get your experience
03:13on. How would you categorize Dubai Investments approach to real estate?
03:19So let's go back to Dubai Investment Park. I think that's the right example. What happens
03:24in Dubai Investment Park is we look at commercial, industrial and residential zones coming together
03:31to create an ecosystem where they seamlessly exist. And this is very unique. This is the
03:36only one which is in Dubai. I hope we see more of that because what it creates is an
03:42ecosystem where people can thrive, can work, and it becomes easy and seamless for people.
03:48And it's across the strata. We're not just looking at the, I think the number is 3,500
03:54millionaires are expected to invest in Dubai this year. It's not just catering to that,
03:59but to across the strata looking at people of various investment appetites will be able
04:03to invest at a project like Dubai Investment Park.
04:07That's an interesting point. And further to that, if we go back to 1995, when Dubai Investments
04:12was formed, ever since that time, the real estate sector has continuously been written
04:18off by critics. People saying it will boom, it won't last, this growth can't happen. Now
04:24you outlined some of those statistics early on. And when you look at some of the prices
04:28for the luxury properties, Dubai is up there with London, Paris, New York. Over the last
04:3525 years or so, what do you think has been the result of this continued growth in Dubai's
04:42real estate?
04:43It is again, a very interesting question because Dubai is a place for investors to park investments.
04:51It's not just that. Just some of the stats that is shared, the population growth, the
04:56fact that through COVID and through times right now, Dubai is constantly attracting
05:01the top talent of the world to work here. It is supply and demand as well. It is not
05:05just about investments. Now that is what is continuously fueling the Dubai growth. Now
05:11the property cycle of Dubai is slightly different from the rest of the world. While again, pardon
05:17my going to mathematics, but if you look at a sine wave, it is usually a slightly slow
05:22curving wave versus the Dubai real estate is a little more. And this is because it is
05:28controlled by a lot of the market dynamics and any market which is outperforming the
05:32rest of the world will always be under scrutiny. And that's what's been happening here.
05:37Well, that's part of the success, but every business and every investment has its challenges.
05:42What would you say are some of the challenges facing the Dubai real estate sector at the
05:46moment?
05:47So one of the biggest challenges, what you said, the perception of the market and real
05:53estate quite like some of the other industries is very perception driven. It is important
05:58to make sure the right facts are out there for the consumers to consume and make the
06:04right investment decisions. What is typical and unique to Dubai is the kind of investment
06:12opportunities people get. You mentioned New York and Paris. There is only as much you
06:17can do there because they're saturated markets. People are not just looking at investments
06:22into houses that they live in, but also into communities, also into resorts, also into
06:31examples like Dubai Investment Park, where they are looking at industrial usage, commercial
06:36usage, etc.
06:38And on that, because when we talk about some of the projects that Dubai investments have
06:42been involved in, Data Bay being one of them that you touched on, there's also Altaf Business
06:48Center. All of these projects are record profits that are the envy of many real estate sectors
06:55around the world. Why have they been so successful? Give us a more detailed breakdown.
07:01Sure. So it is very important to predict the demand rather than follow a trend. Now, Dubai
07:08Investment, what has done well is they have predicted the demand that we are creating
07:17an area which will be industrial in use, which will be commercial in use, but that would
07:22have a constant flow of people who would want to live there. And healthcare will require
07:29that and new businesses which will want to come there, which will require a business
07:32center. So they've predicted the demand and followed that trajectory rather than just
07:36follow trend.
07:37So in countries that are experiencing big population growth, governments tend to be
07:41playing catch up with housing versus the population growth. And it does seem like, and I'm looking
07:45at this from the outside, that they're not just building homes that try and control the
07:52need with the population growth. They're actually creating a demand because of the quality of
07:56the investments. Is that a fair assumption?
07:58That is true, because the constant influx of people who are moving to Dubai from across
08:03the globe, we've seen trends where there were Russians who were big investors into
08:07Dubai, to the Chinese who are investing big time. We also have a lot of Indians and Brits
08:14who are investing. So we see a constant inflow of people who are making Dubai their home,
08:19which makes it a demand driven market rather than just investment driven market.
08:24And aspirational as well.
08:26Always, always, absolutely.
08:27You mentioned how the Dubai real estate market has this history of going like this. Given
08:33your experience, Gautam, for any business, really, or any sector, when you've got changing
08:37market conditions, and there's always rapid change, what are those challenges that companies
08:43like Dubai Investments can face?
08:46So it is very, one of the insights that I can look at this is, so when you look at Dubai
08:53Investments, it did not go after what an Emaar is doing, or what a Nakheel is doing, or what
08:58a Damac is doing. At the core of it, it's an investment company, it's not a real estate
09:02company. So they've never, like I said before, they don't want to follow trends and create
09:07communities just for the sake of it. But again, they've consciously looked at creating solutions,
09:14which are bespoke for people who want to use it rather than just have something created
09:20for the sake of attracting investment, and those Instagram properties. And so the challenge
09:25of that is slightly different, because this is more about catering to demand rather than
09:30creating the demand.
09:31We touched on in the first episode, diversification, and just revisiting that once again, the importance
09:38of diversifying and mitigating the risks, because there's always risk. What do you think
09:43has worked for a company in trying to mitigate risks like Dubai Investments?
09:48So going back to some of the properties and projects we've discussed, now, Dubai Investments
09:54has looked at not just investing into projects and creating properties of real estate, but
10:03they've looked at the ecosystem, you know, like cooling companies to plug into that healthcare
10:07companies coming in to plug in that. So while, again, going back to the first episode, it's
10:12still concentric, because we have Dubai Investment Park, but it has all the various arms of creating
10:20a community that takes the risk away.
10:23But it would also be easier to sell, I think, when you're looking at some way to live, to
10:27be able to say, this isn't just a unit in the sand. You know, this is villas with parks
10:33and pools and business centres.
10:36Absolutely. And it's, again, not a specific lifestyle that you're living on the palm,
10:42and then you have a high end luxury lifestyle. You can have that in the villas and the garden
10:46communities you're talking about. But you can also have staff accommodation, which is
10:51also a requirement. You can also have housing for, you know, all the people who are working
10:56and coexisting in a particular area.
11:00Looking towards the future, now, it's almost impossible to predict. But looking at research
11:06and your experience of reading the market, what do you see the trends? When it's going
11:11to real estate, certainly in Dubai, how do you think a company like Dubai Investments,
11:17which is not solely a real estate company, how do you think they are then going to stand
11:22out in the market and be able to see the opportunities in real estate going forward?
11:27So interesting question. At the risk of repetition, I'd say Dubai Investments has not been a trend
11:33follower, but they've been trendsetters with projects like Dubai Investment Park, where
11:39we're taking the emphasis away from just the luxury properties, because that's not the
11:44entire real estate market. With areas like Reem Ram, Dubai Investment Park, what happens
11:51is we're attracting people of a different investment appetite, where they're not just
11:57living but also buying properties which are buy-to-rent, which gives high yield, 9-10%
12:03yield.
12:04Investment properties.
12:05Investment properties. But not necessarily the high-ticket investment properties, but
12:08investment properties which are not so high to enter, but you get good returns.
12:12And would that mean they're lower risk?
12:15Absolutely. Just with the capital infused, the sum goes down, the risk goes down with
12:21that. If you look at, again, diversification trends, while Dana Bay is coming up in Russell
12:28Kema, which shows the ambition of Dubai Investments to venture into not just Dubai, but other
12:33emirates, which is great because we're seeing boom across all emirates, and we're seeing
12:39amazing projects come in those emirates.
12:42Yeah, some of the projects at Russell Kema are just, they have to be seen to be believed.
12:46So, extraordinary work that's coming up. Well, Gautam, thank you very much for sharing your
12:51insights and also your experience. It's been a pleasure just hearing about some of the
12:56projects coming forward with Dubai Investments.
12:59Absolute pleasure talking to you again, and happy to be here.
13:02And if you would like more information about Dubai Investments, or would like to learn
13:06more about the topics covered in this series, please visit the website, www.golfnews.com
13:12forward slash investing dash in dash the dash future. I'm Lachlan Kitchen, and thank you
13:19very much for joining us on this incredible journey through the world of Dubai Investments.
13:36Transcribed by https://otter.ai