Hamid Jaafri
- Wealthy Russians’ interest in Dubai has surged after sanctions excluded them from other countries.
- Hamid Jaafri, One Investments’ CEO, helps international clients buy luxury real estate there.
- This is Jaafri’s story of the recent boom in Russian investment, as told to Insider’s Kiera Fields.
This as-told-to essay is based on a conversation with Hamid Jaafri, CEO of One Investments, an international real-estate brokerage for properties in London and Dubai, United Arab Emirates. It has been edited for length and clarity.
I run a real-estate brokerage with offices in London, New York, and Dubai. We’re an international agency that helps clients invest in London and Dubai real estate. Most of our clients come from Europe and the US.
We expanded our operations to Dubai in 2017. Most of the people buying Dubai real estate are international investors operating in unfamiliar territory. We help them understand local legalities and process multimillion-dollar property deals.
Of all our clients looking to invest in Dubai property, Russians are always in the top 10. Over the past two weeks, they’ve risen to the top three because of a recent surge in Russian demand of Dubai real estate.
In the past few days, I’ve personally met with multiple Russian clients who are billionaires on the Forbes rich list. For me, that’s unique.
Typically, an average buyer would come down to Dubai multiple times and see one or two properties a day. We rarely deal with our most exclusive clients in person, and more often than not, communicate via their handlers.
‘We probably viewed more than 10 properties in one day’
Last Friday, I got a call asking me to arrange a large number of viewings the next day for a Russian billionaire who wanted to close on a property fast.
The Russian billionaire client I met on Saturday seemed to be in a frenzy. We probably viewed more than 10 properties in one day. The most expensive property I showed him was worth $40 million.
People are usually trying to find the perfect property. I felt like this client wanted to get in and out, to complete the transaction as quickly as possible.
I rarely go to viewings myself, but these ultrawealthy Russians are coming down in person and want to deal with the owner or the top person in the business. It shows you the urgency with which they’re looking to invest and set up a base in Dubai.
I meet the clients and show properties only if they want to invest over a certain threshold. I’ve had to go on more viewings this week than in the past three months, and these clients have been almost entirely Russian.
Within a week of Russia’s invasion of Ukraine, one of the private developers we work with in Dubai had changed its policy to accommodate potential Russian investors.
If a Russian investor wanted to contract his company to begin a development project, they would have had to pay a higher deposit to start building. Now, it’s reverted its policies to normal, where everyone pays a 19% deposit and then a percentage every time a portion of the building is completed.
2 types of Russian prospective buyers
We’re seeing two groups of Russians looking to buy property.
One group consists of superrich Russian clients who are looking to set up a base in Dubai but whose liquidity is in Russia, so they need to be on the ground in Russia. Dubai is a base for the time being. The other group comprises people under 35 years old who are looking to relocate to Dubai permanently.
Lots of these under-35s are still very rich. They’re looking to buy property for up to $10 million and register new businesses in Dubai to relocate their operations here.
Since June 2021, foreigners are allowed to set up their own businesses as a way of securing residency. Prior to this ruling, expats would either have to set up a business with an Emirati or be employed by an Emirati company.
Our staff member who is responsible for incorporation helps our international clients set up companies in Dubai. She has seen an uptick in under-35 Russians who are registering new businesses in Dubai with the intention of relocating permanently to the UAE to scale their business.
I’ve seen instances in past weeks where these under-35 Russians are hiring staff in Dubai and renting office space. They appear to be moving their families out here, too.
I’ve asked a few of the Russian clients I’ve spoken to about their opinions on the war in Ukraine and international sanctions. Few people like to talk about it. But if they do, they say the situation is horrible.
Western sanctions affect Russians in Dubai
The son of a client told me he couldn’t withdraw any money unless he was in Russia or transfer money from his Russian bank accounts to accounts outside Russia.
We have buyers who have put deposits down, but we also have buyers who are experiencing delays transferring funds. In the past few weeks, many of the Russian clients I’ve worked with have tried to convert their cryptocurrency into cash.
In Dubai, you can buy property with cryptocurrency and cash. But the more expensive the property, the more complicated processing the transaction will be. These transactions are happening, and Russian clients are buying properties.
The influx of Russian investment in Dubai real estate has affected me because I have to work as fast as our clients want to move. If they need to make decisions quickly, I have to make things happen even quicker.
We’ve also had to start a new hiring campaign for Russian staff. We already have Russian speakers on our team, but I expect that what we’re seeing is just the beginning, so we’re looking to get more Russian speakers on board.
I think Russian and international investors now see Dubai as a place where their assets will be secure and accessible during economic and political unrest.
Powered by WPeMatico
