**Booming Real Estate Market in the UAE**
The real estate market in the United Arab Emirates (UAE) is experiencing a significant surge in demand, with Dubai rents in 2024 increasing by 23% compared to the previous year. Additionally, sales have risen by 18% during the same period, indicating a strong upward trend that is expected to continue in the coming years. This robust market performance has led to a good problem for the UAE, as there is no shortage of buyers in the country.
**Abu Dhabi’s Involvement in the Market**
The increasing demand for real estate in Dubai has also spilled over to neighboring Abu Dhabi. To further boost investment in its real estate market, Abu Dhabi’s sovereign wealth fund, Mubadala Investment Company, recently participated in a $14 million Series A funding round raised by Stake, a Dubai-based fractional property investment platform. This move highlights Abu Dhabi’s long-term plan to diversify its revenue streams away from oil and gas production and position itself as a residential hub for individuals working in Dubai.
**Stake’s Expansion Plans**
Stake, founded in 2020 by Manar Mahmassani, Rami Tabbara, and Ricardo Brizido, aims to use the funding to fuel its international expansion plans. The majority of the investment will be utilized to enter Saudi Arabia in the next few months, with plans to expand to Abu Dhabi next year. Stake has already raised a total of $26 million to date.
**Stake’s Unique Approach**
Stake offers a simple process for property investors. It allows individuals to buy shares in properties managed by the platform on behalf of shareholders, enabling them to earn a portion of the monthly rentals and a share of the profit if the property is sold. The company also provides an exit strategy for investors through a secondary market called Exit Windows, which opens up every six months.
**Customer Base and International Expansion**
Currently, Stake has more than 200 properties under management, with the majority of its customers based in the UAE. In terms of international customers, individuals from Saudi Arabia and Kuwait represent the largest portion, while customers from the U.S., Canada, and the U.K. make up approximately 12% of Stake’s customer base. The company has partnered with U.S.-based private investment platform Republic to attract more overseas investors and expand its reach beyond Dubai.
**Golden Visa Program**
To attract more international investors, Stake, in partnership with the Dubai International Financial Centre (DIFC), offers a golden visa to investors who commit at least AED 2 million (~$545,000) to the platform. This visa provides a 10-year renewable residency permit in Dubai, which was introduced in 2019 to incentivize foreign investment in the region.
**Entering the Saudi Arabian Market**
While Stake has surpassed other Dubai-based fractional property investment platforms like Smartcrowd, it will be starting afresh in Saudi Arabia. The country already has companies like Awaed and Aseel that allow customers to invest in properties through funds. Stake plans to leverage its experience and offer a unified product for investment in Saudi Arabia within the same app. This presents an opportunity for Stake to tap into the billions-worth of recently completed and under development properties in Saudi Arabia.
**Future Plans and Profitability**
Stake aims to break even in Dubai by the end of this year and become profitable by next year. The startup is also exploring partnerships to enable individuals from the Middle East to invest in properties in countries such as the U.S., further expanding its global presence and offering more opportunities for investors in the region.