In February, I landed in Dubai for the first time, after having heard so much about it. I was astonished by the number of towers already built at that time but more by the huge amount of cranes and construction sites. Therefore, I decided to do my internship for a real estate broker. I quickly understood how easy it was to earn a lot of money with the growing flow of expatriates demanding accommodation, versus the lack of availabilities. As a result, I started to work as a freelance agent till July 2006, when I left the country to complete my studies. As I returned to Dubai in 2008, the skyline had totally changed, with towers and projects that have popped out of the sand in such a short lapse of time. Those experiences as a trainee in the real estate sector in Dubai, have brought me much, but something above the others: I have discovered the industry in which I want to start my career and this is priceless. While I was out in the field, I had two tasks. Not only was I dealing with customers, and acting in actual situations but I was also trying to analyze the environment I was evolved in, trying to step back, keeping a critical point of view and meeting with as many people as possible, from different backgrounds, in order to ensure the credibility, objectivity and accuracy of this research.
[...] Example of a small sized real estate company in dubai Almasah International Real Estate 2.1 Company profile History / Founder At the beginning of this fabulous and successful adventure, the odds did not predict Dr. Aboutaleb Shokrollah Talebi to start a business in real estate. Indeed, this Iranian national was a renowned surgeon in his home country. In 1993, he decided to leave Iran and to settle down in Dubai where a huge Persian community is already living. The aim was to open his own private clinic which he did for several years. [...]
[...] -Suggestions for a SME such as Almasah International Real Estate to grow and succeed in such a difficult environment: -Growth strategy with vertical concentration and / or Partnerships -Pro-activity of the legal department towards the fast changing legislation -Implementation of modern ways of communication for in/extern communication -Develop the activities' portfolio by adding the property management activity) -Internationalization of its activities -Diversification of its activities 5 KEY WORDS: Growth / Oversupply / Reorganization / Concentration / Internationalization. Introduction Dubai. This is the history of a tiny port in the Arabic Peninsula, used back in the 1930's as a trade platform. [...]
[...] SWOT Analysis Table The SWOT Analysis Strengths Weaknesses -Multi-speaking and active sales -Management structure force -Lack of clients follow-up -Large sales force (over 50 agents) -Weak customer service -Deep knowledge of the market -Weak business ethics (agents) -Wide portfolio of projects -Lack of advertising under-construction -Lack of marketing activities -Strong database of landlords (forecasts surveys, customer (Iranians) feedback etc.) -Important cash flow available -No connections with Government -Projects located in strategic decision makers areas of Dubai -Working mainly on the residential -Plans to invest in new projects properties segment -Small experience in the construction business -No activities abroad -Focus mainly on the Iranian community Opportunities Threats -Increasing population in Dubai price correction will occur on -Cheap labor force the coming years in the market -One of the fastest growing real -The supply will overcome the estate market in the world demand in the coming years -Dubai creates a huge draw for -Oligopolistic market with 3 major international investors government owned companies -More and more Iranian investors -Rise in the raw material prices invest in real estate rather than (cement, steel etc.) leaving their money in banks -Lack of governmental transparency (international pressure) -Strong competition -The government is working to make -Apparition of emerging markets in Dubai become the world most the region (Abu Dhabi, Qatar) favorite tourism destination -Growing doubts in the construction quality -Bad image of agents unethical practices 2.3 Growth strategy Vertical concentration As explained in the part concerning the core business, AIRE moved from the status of simple broker to the status of developer. [...]
[...] Source: MEED Dubai real estate residential report 1.3 Deeper look at the Real Estate Market in Dubai Macro environment - PESTEL Model Legal : -Freehold legislation (see ) - Lack of Laborer rights: Many tourists have been surprised by the extreme conditions in which laborers are working very hard on the construction site. On top of a heat reaching up to 55C during the peak season, those people coming mainly from the Indian Sub Continent and Asia do not receive the necessary safety equipments while on duty. [...]
[...] Barriers to Entry: Brokerage: As explained before there is difficult elements a company has to master if it wants to get in the real estate market in Dubai and overcome its various competitors. I am specially referring to the financial factor. Moreover, there are today around 350 brokerage companies in Dubai which is a lot for this city. It would be too hard for a new company to offer a USP to its clients. Although the customer's service level is very low here in Dubai (which would allow a company to enter the market with a different positioning ex: customer oriented), it would be hard for a new company, to enter the market and start its activities despite its good knowledge of the market. [...]
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