Dubai, 05th February 2015 - ‘Real Estate’, two of the most powerful and important words for anyone living and working in Dubai. We’re not just obsessed by the price of houses, we live in an economy driven by the housing market and shifts in property prices, up or down, can change fortunes overnight.
The property market in Dubai is an investors market. It starts with the Property Developer who purchased a parcel of land on which to build hundreds of apartments, and carries over to the brokers who market the finished units, and then to the landlords who buy and rent those units, through to the tenant who sets his monthly budget. The important thing to remember is that every person within the property -chain is looking to maximise their individual investment return.
With more and more properties not only being launched but also completed in Dubai, the market for both off-plan and completed properties is increasingly competitive. For completed properties, particularly those that are over 5-10 years old, these can be harder to sell compared to newer properties. With renovation opportunities limited, one firm Interiorra has found a secret to success that is being used by landlords, brokers and developers to move their properties faster in the market and at a higher premium.
“Our business is simple. We design and create complete furniture packages, right down to the cutlery in the kitchen drawers. When a client, whether that’s an owner-investor or a developer, purchases a furniture package, what we provide them with is complete selection of furniture and accessories for their property. Every element has been carefully selected and designed to work as a whole.” Said Suzanne Haines, Partner at Interiorra.
Suzanne is quick to point out that Interiorra is not an interior design firm.
“Although, we have an interior design process, in the creation of our packages, this isn’t our offer to market. We provide our clients with furniture solutions from start-to-finish. Once they have chosen a package, we deliver the furniture to the site, set-up and dress the individual rooms. And when we finish, those rooms are ready-to-live.”
Dubai’s freehold property market is an international market, where many of the owners do not reside in the Emirate but lease or sell their properties through local real-estate brokers. This distance from their asset can make it difficult to influence the sale or enhance their property to command a higher price in the market. Using a furniture package eliminates the stress, mess and hassle of re-decorating a property, whether that’s hiring contractors or defining an interior plan for the furnishing.
“Renovations, interior design and refurbishment, these all add value to properties. This is well-established. As an example, one of our clients’ owned a 907 square foot apartment in Dubai Marina. They offered the property unfurnished at 1.8 million AED for sale. They changed their whole strategy by adding a furniture package. Within 3 days of installing a turn-key furniture package, the property rented to a corporate client for 160,000 AED. Paid in one cheque. The furniture package cost 63,000 AED. Two months later, the owner increased his sale price to 1.9 million and sold the property. Adding that all up, the seller made 2 months rental income, approximately 26,000 AED, and they netted an additional 100,000 AED over their earlier price. That’s a net profit of 63,000.00. A 100% return on investment on the original furniture package.”
The Interiorra office, located in Jumeirah Lake Towers, is part showroom, part workshop and part-office. The showroom, encompassing two rooms, allows visitors to touch, feel and experience their furniture packages. The workshop reveals some of the design process that goes into each furniture package, with the walls adorned with fabric and material swatches that are used to compare and contrast every material detail from carpets, cushions, flooring and upholstery.
“It almost sounds too easy but there’s a lot of work that goes into what we do. It’s really a value-add solution for all the major players in the real estate market: the developer who eliminates supply-chain problems and can deliver on their investor expectations, the owner investor who makes a higher rental-return, the tenant who doesn’t need to worry about anything, and the agents, who help their clients make a fast sale or quick lease of their property.”
Suzanne paused and smiled before concluding.
“Furnishing solutions is really more apt than just furniture packages. We even take care of the curtains. Do people consider those to be furniture?”