Dubai-based Deyaar Development said on Wednesday its profit in the third quarter rose sharply on year as it drastically reduced costs to make up for a drop in revenue.
Revenues were lower as the developer continued to focus on completing existing projects and growing sustainable income amid challenging market conditions.
Deyaar , Dubai’s second largest developer by market value, made a net profit of Dh5.1 million in the three-month period, up 673 per cent from Dh0.66 million in the year before period, the developer said in a statement posted on the Dubai bourse website.
Revenues in the last quarter fell to Dh137.4 million, from Dh184.4 million a year earlier, according to its financial statements.
Deyaar shares closed flat at Dh0.369 on Wednesday.
Deyaar said it remains focussed on completing existing developments and growing sustainable income from property, facilities management and leasing businesses even as the repercussions of the global financial crisis continue to impact the company’s financial performance.
The company said it is well placed to take advantage during this present period of expected increased stability in the UAE property sector, in line with more positive macroeconomic conditions and deliver profits regularly.
Dubai property prices fell by more than 50 per cent in the aftermath of the global financial crisis in 2008, but there are signs of recovery now, especially in some prime locations.
Earlier this month, Saeed Al Qatami, Deyaar ‘s chief executive officer, said that the firm would focus on selling more than 400 unsold units from its old projects.
Deyaar ‘s results follow that of Emaar Properties, Dubai’s biggest real estate developer, which reported a 4.7 per cent drop in third-quarter profit on Tuesday
Qatami said that Dubai’s real estate market was picking up again after a damaging slump in prices and confidence from a 2008 peak.
“The Dubai market is showing signs of recovery given the increase in demand and investor confidence,” Qatami said, adding that stricter rules and regulations for the property market would help stabilise the market further.
“When you activate rules and regulations, you will protect the market from speculators. Something like not allowing owners to sell a unit in the secondary market before paying 30 per cent of the total value will stabilise the market,” he said.
Dubai’s property market is showing some signs of recovery after almost four years of falling prices, surveys show.
The number of property transactions jumped by 50 per cent in the first half of 2012 compared with a year earlier, data from Dubai’s Land Department show.
The purchases, valued at Dh12 billion, are still 74 per cent less than the Dh46.5 billion of sales in the first half of 2008.
Khaleej Times
