By Andy Sambidge www.arabianbusiness.com
Homes and offices located next to the Dubai Metro could see price uplifts of 20 percent but it may take up to five years to happen, a global real estate advisory firm said.
But Andrew Edwards, associate director at DTZ and author of the report, added that the price impact would not be even across the station network.
He said: “If the Dubai Metro proves popular and efficient then it is very likely we will see a significant impact on the values around stations. As a general rule, the larger the modal share (the percentage of people using the Metro in relation to other forms of transport), the larger the impact on surrounding values .
“The early signs have been positive. DTZ considers the potential uplift in the immediate vicinity of the Metro stations…could be in the region of 10-20 percent for both residential and commercial uses.
“Furthermore, those price hikes may not be seen immediately and it will take time for the Metro to be widely used and the accessibility benefits to be understood. In some cases, it has taken three to five years for price uplifts to filter through.”
Edwards added: “The impact is likely to be more significant at certain destinations such as Jumeirah Lake Towers for residential and Dubai International Financial Centre for commercial. This is because there is a high concentration of residential use at JLT and commercial use at DIFC which is likely to translate into a high level of trip generation.”
The report suggests that the current state of the property market was also a major factor and if it was in a downturn, the degree of accessibility would be irrelevant as prices were still likely to decrease.
DTZ added that Central Business District (CBD) locations were less likely to benefit from large uplifts because they were already accessible before the Dubai Roads and Transport Authority launched the metro on September 9.
One of the key findings of the report, DTZ said, was that land use and development was likely to change in Dubai as a result of the Metro with future development more concentrated within walking distance of the Metro stations .
DTZ employs more than 10,000 staff across 148 cities in 43 countries .