A joint venture between a landowner and a developer: a new district in Dubai
A Dubai government developer and a leading listed developer formed a JV to develop over 1,000 hectares in Dubai. How a land-plus-development partnership works and what a landowner can take from it.
Carte Capital · 5 min read
The idea
The owner of a large site rarely wants to sell it all at once: that hands the future value to the buyer. A developer, in turn, struggles to pay for land up front. A joint venture resolves this: the land goes in as one partner’s contribution, development and sales as the other’s, and returns are shared. This Dubai project became one of the best-known examples of the model in the Middle East.
Structure
- In 2013 a Dubai government developer and a large listed developer announced a JV to develop a new district as the first phase of a major city project.
- Over 1,000 hectares next to the business district: housing, an 18-hole golf course, parks, a regional mall, schools and a hospital.
- The project is built in phases. Each phase is sold separately, so buyers’ money funds the next one.
- Financial terms and the partners’ shares were not disclosed.
Parties
| Party | Role |
|---|---|
| Government developer | JV partner |
| Listed developer | JV partner, development and sales under its brand |
Numbers
There are no public figures on the JV’s economics, but the land area shows the scale: over 1,000 hectares, larger than the city’s business district. Development has been going on for more than ten years, and new phases are still being launched.
Risks
- Governance: with equal or near-equal stakes the partners need a clear decision process and a deadlock exit.
- Market: a project spanning decades passes through several cycles, and returns depend on when phases come to market.
- Valuing the contribution: land is worth one thing today and quite another after permits and sales launch. How the contribution is valued must be agreed before work starts.
Lessons
- A JV lets a landowner share in the value the developer creates, not just the land price on the day of the deal.
- The developer saves capital at entry and puts it into construction.
- The key JV terms: shares, funding obligations, who runs sales, exit routes and what happens in deadlock.
In our practice
We have structured several landowner-developer JVs for residential projects of 15,000 to 40,000 m² in Moscow. More on the JV logic for landowners: Moscow land: why joint ventures are replacing outright sales.