June 7, 2012 12:51 pm
Dhalia is to establish a property management division
Dhalia is to establish a property management division to take its service offering to clients up a notch, chief executive Chris Grech told The Times Business.It is one of the first projects Mr Grech has planned for the real estate group now that he is back at the helm after dividing his time between Malta and Bulgaria where he has dedicated the last few years to marketing the Balkan Jewel development.
He returned to his office full-time at the group’s headquarters in Mrieħel in early March, geared to embrace the new prospects of Malta’s property market after the price correction during the slowdown.
“I am excited to be back to head the team,” Mr Grech said. “The local property market has changed, and it is much more specialised, demanding, and accountable than it was even five years ago. New investors are designing only high quality products in good locations and mark-ups are nowhere near where they were some years ago. Developers succeed with volume. There is a promising future in the market.”
Like many of his peers in the industry, Mr Grech says the recent price correction was a blessing of sorts – valuations were previously climbing so rapidly that it was clear “the bubble had to burst eventually”.
“Something had to give,” Mr Grech said. “There was no correlation between the economic situation, the spending power, and the value of property itself. The correction came at the right time, possibly for the wrong reasons, because it was initiated by the economic situation worldwide.”
With a decline in value of properties accessible to first-time buyers by about 25 per cent, supply increased tenfold, even though demand and sales remained stable. The conditions are now right for quality property to be snapped up and buyers are getting better value for their investment – with improved service levels. Developers are now more accountable for the quality of their projects and buyer-seller relationships are healthier.
“I’ve seen property developers become much more professional in the last five years,” Mr Grech added. “They have gone into project management, quality control, security and energy issues, and they meet deadlines.”
The chief executive pointed out the suspension of the permanent residency schemes last year had little to do with the price correction, although that did leave a negative mark on the higher end market.
The move by the Finance Ministry to suddenly suspend the schemes led Malta to seem unreliable and unpredictable at a time when numerous commitments, campaigns and plans were already in place. Much of the groundwork carried out by the legal, financial and real estate community went unrewarded as clients’ positions suddenly became unclear.
“It did affect the property market, without any doubt,” Mr Grech explained. “It now seems that things are back on track, even though the conditions are not as favourable as they were before. At least we know where we stand. We have a fantastic product, but we have to realise that the competition has a fantastic product too. Clients can opt for Portugal and pay zero tax. That is not to suggest that Malta moves in that direction, but let as not be as insensitive as we have been. The performance of the property market has a ripple effect on ancillary industries.”
Mr Grech voiced concern over the bureaucracy to which high-end clients from the US, South Africa and Russia were subjected, when their intention was only to come to the island and spend several million euros here.
“There is availability of a product which cannot be sold to anybody else but these clients who have legitimate cash to spend,” he warned.
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