Islamabad: A recently published report by the EU Tax Observatory made shocking revelations about the offshore ownership of the real estate in Dubai. According to the report, nearly 20,000 Pakistani nationals (19,662 to be exact) owned more than 38,000 properties in Dubai, worth over $10 billion.
The report, titled “Who Owns Offshore Real Estate? Evidence from Dubai”, was released this month and had enlisted countries that held the most number of offshore real estate in Dubai.
The report mentions that for its research, the ownership of a total of 800,000 properties in Dubai was analyzed. The researchers estimated the total market value of properties in Dubai at $533 billion as of 2020, of which about 27% were foreign-owned.
Hinting at the enormity of Dubai’s offshore real estate, the report stated that by estimate, offshore real estate in Dubai added up to at least $146 billion, which makes at least 27% of the total properties.
“Foreign-owned real estate in Dubai thus appears to be about twice as large as in London, despite the fact that Dubai (with a population of 3.5 million) is only a third the size of London (population of 9.0 million),” the report said.
India leads the list of the number of foreign owners of property in Dubai, with about 35,000 Indians owning properties worth almost $30 billion (20% of total offshore Dubai real estate).
The United Kingdom comes next with 23,000 unique owners, with properties worth $15 billion, 10% of the total cross-border ownership.
Following India and the UK on the list is Pakistan, with nearly 20,000 owners and having invested more than $10 billion. The total number of properties owned by Pakistanis is 38,907.
However, the report did not mention any names of individuals or institutions who owned this property as the purpose of the research was to show how the lack of cross-border exchange of information on real estate ownership was a significant issue for tax enforcement.
It also suggested that the geographical proximity and historic ties were important determinants of foreign investments in Dubai as the bulk of foreign-owned properties belonged to owners from the Middle East, South Asia, Europe, and Central Asia.
It also showed that those countries that faced crises at home and were conflict-ridden (e.g., Afghanistan, Syria, Yemen) or were under autocratic rule (e.g., Eritrea, Azerbaijan, and Kyrgyzstan) had massive holdings in Dubai real estate relative to the size of their economy, equivalent to 5%–10% of their GDP.