RAK’s strong alignment with UAE’s National Hydrogen Strategy and local Clean Energy policies is a huge catalyst for growth as a leading Real Estate Investment destination within UAE. RAK continues to thrive despite its more glamorous neighbours of Dubai and Abu Dhabi, but the continued commitment to RAK maintaining a growing emphasis on Energy Diversification, Sustainable Industry and International Investment continues to attract a growing investor base.
A Vision for Energy Strategy that Provides Business Opportunities
UAE has been working towards an overall Hydrogen Strategy (to acquire a global leadership position as a hydrogen provider and the ability to develop mobility and export, along with an infrastructure and technologies to support the development of hydrogen technology, to achieve this vision of a long-term move toward renewable energy) through the development of policies at RAK that are complementary to UAE’s national vision of developing itself as a hydrogen provider and for the use of hydrogen in both the Energy and Transportation sectors.
Hydrogen-related programs also generate related industries (e.g., Logistics, Manufacturing, Clean Technology), which result in the creation of Jobs to support the growth and increase of both Energy Production and Industrial activity, leading to increased demand for housing and retail and commercial properties. The net result of added jobs is increased demand for housing and rental occupancy, as well as ongoing robust Real Estate Demand.
Economic Diversification Enhancing Real Estate Appeal
Ras Al Khaimah’s expansion efforts have successfully moved away from its previous heavy reliance on one single industry (i.e. agriculture). In addition to the traditional industrial base, RAK has developed a multi-faceted, diversified economic environment; which has included manufacturing, trade, tourism and advanced logistics.
The development of new entities and organisations, such as the Ras Al Khaimah Economic Zone (RAKEZ), has allowed for an increase in industrial and energy related projects within RAK. Many of these projects are focused on hydrogen production and clean energy sources.
Many international companies and new start-ups continue to enter RAK, creating a need for an expanded expatriate workforce. As a result, the local property market continues to grow, both in terms of demand for rental residences, family-oriented properties and high-end commercial properties, providing the base for ongoing growth in the local property market.
Tourism Synergies and Destination Growth
RAK is developing a successful tourism strategy through synergies between hydrogen and RAK’s sustainability goals. RAK will improve and promote itself through the emergence of new developments, such as the Wynn Hotel on Al Marjan Island, which are receiving global attention. Improvements made to infrastructure related to energy and transportation make RAK an increasingly attractive destination.
In recent years, RAK has welcomed over 1.2 million visitors. This large volume of tourism creates demand for short-term rental accommodations, serviced apartments, and hospitality-related investments (e.g., hotels). Due to the recent expansion of the hydrogen-related industry into RAK, RAK will need to develop additional product offerings to continue to support this demand.
As clean technology researchers, professionals, and employees of organizations engage in economic development activities in RAK, the tourism industry will evolve into a more diverse ecosystem of residential and commercial product types.
Competitive Entry and Long-Term Value Potential
Properties in Ras Al Khaimah (RAK) are generally cheaper than those in larger UAE cities, yet the projected rental return is higher than those in larger emirates. Waterfront developments such as Al Marjan Island, Family-Friendly Communities & Economic Diversification Zones like Al Hamra and new Logistics Zones are all benefiting from this advantage.
Sustainability Credentials Boost Market Confidence
The increasing focus of RAK’s energy efficient and renewable energy development, beyond hydrogen to include water and electricity conservation targets, further enhances the perception of Ras Al Khaimah as a progressive city. Global tenants and investors are increasingly turning to buildings and developments designed with a sustainability commitment for strong rental income and increased long-term capital appreciation.
1. How does the hydrogen strategy impact property demand in RAK?
The Hydrogen Strategy supports a growing economy by drawing firms and professionals to address an increasing population within Ras Al Khaimah and subsequently increasing the demand for housing and to absorb real estate within the residential, commercial, and industrial real estate markets.
2. Which areas in Ras Al Khaimah show the strongest investment momentum?
Ras Al Khaimah has the most robust investment potential currently within the waterfront communities of Al Marjan Island and Al Hamra. Al Hamra and Mina Al Arab are also great areas for long-lasting rental and capital appreciation due to their proximity to amenities and services.
3. What type of returns can investors expect?
RAK offers competitive yields when compared to other larger UAE property markets based upon low entry prices, growth of tourism and an increase in both employment opportunities and demand for properties. Return on investments vary by property type and location within the Region of Ras Al Khaimah but are very well positioned for growth in the future.