What to take into your next appraisal
- Confirm the plot, development rights and sale structure before selecting a revenue programme.
- Record the authority, document and prerequisite behind each cash milestone.
- Model a delayed approval separately from slower construction.
Identify the legal project and its parties
Record the plot identifier, title holder, developer, project vehicle and proposed tenure before building the appraisal. Ask the project advisers to confirm permitted use, development rights and any restrictions affecting buyers. The ability to build, market, sell and transfer units represents different questions, each requiring evidence.
ADREC publishes Abu Dhabi real estate legislation. The published Law No. 3 of 2015 describes developer obligations and a project escrow framework. Treat that instrument as a source to read alongside current implementing decisions and the project documents, rather than as a substitute for a current transaction opinion.
Sources: Abu Dhabi Real Estate Centre: Law No. 3 of 2015 regulating the real estate sector
Turn approvals into a milestone register
For each milestone, name the evidence owner, predecessor, planned date and cash consequence. An approval recorded as complete should link to the actual approval and its conditions. A programme date entered by an analyst is an assumption until the responsible party confirms it.
| Milestone | Evidence owner | Cash consequence |
|---|---|---|
| Development scope | Planning consultant | Design and infrastructure allowance |
| Off-plan structure | Legal adviser and developer | Start of eligible contracting and collection |
| Escrow operation | Account trustee | Receipt and release timing |
| Completion and transfer | Project and conveyancing teams | Final buyer collection and debt repayment |
Read the escrow terms before using receipts
Article 18 of the published law addresses opening a project escrow account and the developer agreement with its trustee. Article 19 addresses disposition of funds, including construction progress conditions. Obtain the currently applicable rules and account terms before specifying a release trigger; do not use an assumed percentage simply because another project used it.
Maintain opening escrow, buyer deposits, permitted releases and closing escrow separately from unrestricted cash. A release paid directly to a contractor reduces escrow and settles a cost; it must not also appear as a second cash receipt to the developer.
Sources: Abu Dhabi Real Estate Centre: Law No. 3 of 2015 regulating the real estate sector
Stress one delayed milestone
In a fictional AED example, the project incurs AED 2.4 million of eligible construction cost across three months, with AED 800,000 due each month. Its plan assumes AED 600,000 of available releases per month and no other unrestricted cash. Required equity totals AED 600,000.
If approval for all three releases moves to month four, the first three months require AED 2.4 million of equity. Peak funding increases by AED 1.8 million even though cost and buyer receipts are unchanged. Once released, the cash only repays equity if the account and financing terms permit that use.
Carry unresolved conditions into the investment decision
The investment paper should distinguish confirmed permissions from planned applications and show the downside funding requirement. Give every unresolved condition a responsible owner and a date by which it must be resolved before land completion, debt draw or sales launch.
Keep Abu Dhabi and Dubai assumptions in separate source registers. Reusing the structure of a cashflow is useful; copying the legal conclusions, fee percentages or release dates is not evidence. Review the register whenever design, buyer eligibility, transaction structure or authority guidance changes.
Sources and further reading
- Law No. 3 of 2015 regulating the real estate sector Abu Dhabi Real Estate Centre
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