At market · +2% breakup Whole building · 85 units Income approach

Dubai South · 85-Unit

Dubai South (area 462) · 2023 · G+4+R · 85 units · 84×2BR (1089–1209 sqft) + 1×1BR · NSA 97 177 sqft · fully let

Whole building · 85 units

At market · we bid at the target

Offer 105M sits +2% above piece-by-piece breakup 102.6M and ≈ income value 107.8M — a market price, no discount. Income-hold on the collected rent gives IRR 4.5%; the deal only reaches 8%+ via confirmed rent reversion (7.6M → 8.36M) or a bargain to ~86.1M.

Package offer +2% vs piece-by-piece

AED 105.0M

102.6M worth piece-by-piece

Price held for the buyer

—

reserved
for you

Why it's in distress — sum of parts

Sold one by one at Dubai South medians, the 85 units are worth ~102.6M. The building is offered for 105M — +2% ABOVE liquidation. Not a discount: this is a market price. The return has to come from income, and the collected rent is thin.

ComponentMedianQtyWorth

Worth piece-by-piece 102.6M

Discount captured

+2%

Worth 102.6M · offered for 105.0M — you enter slightly ABOVE the breakup floor. The edge here is the rent-reversion upside, not the entry discount.

Two valuation bases. Entry priced by liquidation (102.6M piece-by-piece). Exit priced by income: 5.92M ÷ 5.5% cap = income value 107.8M on collected rent (121.6M on full reversion). Offer 105M sits between — a fair market price.

Asset income — rent

The building rents ~5% above the Dubai South market — quality income, fully let. Seller's "Net 7.18%" was on fake 60k costs; the real Mollak service charge is 1.68M/yr, so the true yield is 5.64%. Upside: collected rent 7.6M is below potential 8.36M — reversion at renewal lifts IRR to 8.9%.

NET rent by year · base +3% · fact rent AED / year

7.60M gross fact / yr

−1.68M service charge

5.92M net year 1

Net yield on offer

5.64%

net 5.92M ÷ offer 105.0M — real SC, not seller 60k

Residential · 84×2BR + 1×1BR (fact)7.60M

Market potential (reversion)8.36M

Occupancy · fully let100%

− Service charge (Mollak)−1.68M

Full entry — all costs

Offer price105.00M

DLD transfer 4% + agent 2.1%+6.41M

Trustee + title (85 × 4 450)+0.38M

Full entry 111.78M AED

Actual amount payable

Offer 105.0M + 6.79M costs (4% DLD, 2.1% agent, trustee & title on each of 85 units) = 111.78M. This is the base for the IRR and exit.

Exit in 3 years — the roadmap

Enter in 2026, hold and collect rent (ideally re-signing to potential 8.36M), sell whole in 2029 at the market yield (5.99% base = 5.49% today + 0.5% buffer). At market entry with a thin cap, exit ≈ entry — profit rides on rent and the reversion. Click any year — its exit math unfolds below.

Exit 2029 · three market scenarios

06+

Resilience — the stress test

What if it doesn't play out? We check the deal across every combination of the two risk factors: rent growth (0/3/5%) × exit-market yield (6.46/5.96/5.46%). The base case is the centre cell — everything else shows the cushion.

Income-hold thin — 8 of 9 cells below the 8% threshold

On the collected rent the base gives 4.5% — only 1 of 9 cells passes. Confirmed reversion to 8.36M lifts the offer to IRR 8.9%; without it the value path is a bargain to ~86.1M (IRR 12%).

Closing offer