Emaar Properties PJSC, the UAE largest listed real estate company, has surged to its highest level in nearly 17 years, continuing a rally spurred by a significant dividend boost. The company, renowned for building the Burj Khalifa, saw its shares jump the maximum 15% for a second consecutive day after announcing a new long-term dividend policy based on cash flows, departing from its historically conservative approach.
The Dubai-based developer plans to declare dividends at 100% of its share capital for 2024 and the next few years, signaling strong investor confidence. This move comes amid a positive outlook for the UAE property market, which remains buoyant thanks to a solid pipeline of new launches, consistent off-plan sales, and a favorable demand environment, according to Neetika Gupta, Vice President at Ubhar Capital SAOC.
Emaar rally has contributed significantly to the Dubai Financial Market General Index, which reached its highest level since September 2014. The main index has surged 25% this year, outperforming the MSCI Emerging Markets Index’s 7% gains, making it the best-performing Gulf benchmark in 2024.
Dubai property market has boomed post-pandemic, driven by liberal visa policies and tax incentives that have attracted both wealthy investors and millionaires. Home prices have soared over 60% since 2020, particularly benefiting the luxury segment, including waterfront villas on the city’s iconic palm-shaped islands. Rents have surged by 18% in the year leading up to November, further reflecting the strong demand for housing.
“Dubai is firing on all cylinders in terms of immigration, tourism, and property prices,” says Hasnain Malik, Head of Equity and Investment Strategy Research at Tellimer. However, he notes that the increasing costs could pose affordability risks, with property valuations now appearing stretched compared to historical norms.
Emaar is projected to report a profit of around 11.5 billion dirhams ($3.1 billion) for the end of 2024, up from about 4 billion dirhams in 2021. Analysts forecast the company’s profit will increase to 13 billion dirhams in 2025 as several major developments are completed.
With the company’s strategic shift in dividend policy and the continued strength of the UAE property market, there is optimism about Emaar future growth, particularly as cash flows are expected to peak around 2027-28.
