Farglory resumes $1bn Al Maryah project in Abu Dhabi
Farglory is to resume work on a high-profile residential project billed as Abu Dhabi’s answer to London’s ultra-luxury One Hyde Park after a complete redesign to make it more affordable to investors.
Taiwan’s largest listed property developer said it had shelled out millions of dirhams on stopping construction work on its US$1 billion Maryah Plaza project on Al Maryah Island for 18 months while it redesigned the project to make it more saleable.
Farglory said it had spent between 1 and 2 per cent of the $750 million and $800m construction costs on the long-awaited 153,000 square metre Richard Rogers-designed glass and steel towers in mothballing construction work on the project for a year and a half and redesigning it to suit the Abu Dhabi market.
The company originally announced the project in 2010 when it billed Maryah Plaza as super-luxury flats designed to compete with One Hyde Park in London and Burj Khalifa in Dubai with an eye-watering price tag to match at around Dh3,750 per square foot.
By the time the project finally broke ground in June 2013, Maryah Plaza had already been through one redesign to make it more affordable and the developer was quoting prices of less than Dh3,000.
Farglory said it was again bringing prices down to about Dh2,500 per square foot in an attempt to meet the market and had reworked its plans to include more studio flats and one- and two-bedroom units.
But local property brokers say that average apartment prices in Abu Dhabi stand at about Dh1,600 per square foot although some of the most prime properties can reach prices approaching Dh2,000 per square foot.
"If customers cannot afford a Rolls-Royce today, don’t force them. We brought [our apartments down] from a Rolls-Royce to an Aston Martin. And today we brought them from an Aston Martin to a Mercedes," said Jack Hu, Farglory Middle East’s managing director.
"To be perfectly honest there is still a gap between here, London, Hong Kong and New York so that is why we had to revisit the positioning again. So we have tried to make it not such high standards in terms of the opulence level. We are trying to be more on a par with the market here," he said.
Mr Hu said that even though Farglory had sold about 22 of the 220 apartments in the first phase of the project in 2013, the developer took the decision to stop work in 2014 once the basement level had been excavated after house prices in Dubai started to dip.
The company sent its development team back to Taiwan for 18 months until it was in a position to restart work.
"It’s very embarrassing to tell you but in the whole of Farglory history we have only stopped work a very few times," Mr Hu said. "When we start, we go all the way.
"I’m a mass developer. I’m not just here to do one project so I just have to keep on moving on this project. We are a listed company. We don’t like having a project idle somewhere. We want to finish the first tower."
Yesterday, Farglory awarded the main contract to build Maryah Plaza to the Jordanian contractor Al Fara’a.
Local property agents said although Farglory had reduced its prices to make it more competitive in the Abu Dhabi market, the company could still find it tough to sell at Dh2,500 per square foot.
"The market in Abu Dhabi is very slow at the moment and, although sales are going through, sellers are having to reduce their expectations," said Andrew Covill, the director at Henry Wiltshire estate agents in Abu Dhabi. "Good properties in Abu Dhabi are selling for around Dh1,600 per square foot and we are perhaps knocking on Dh2,000 per square foot for some studio apartments on nearby Reem Island.
"However, Dh2,500 per square foot is still very ambitious for this market and until the project is nearer completion I think it will be a very tough sell."
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