Ferit Samuray

  Real estate investors love cap rates because they seem to simplify a complicated world. A single number is supposed to tell you what a building is worth and how risky it is. In most mature markets, that shortcut mostly works. Higher uncertainty demands higher yield. Lower risk earns lower yield. Dubai is where that logic starts to wobble. To investors coming from the US or Europe, Dubai pricing, especially in prime residential and mixed-use assets, can look hard to justify. Cap rates often sit lower than many expect for a market that is still treated as ‘emerging’. The common conclusion is that prices must be getting ahead of fundamentals. But that assumes risk is priced the same way everywhere. In Dubai, a meaningful part of the risk equation is different, and some of the risks that cap rates are meant to compensate for have been reduced in other ways. That is where the idea of ‘regulatory alpha’ comes in. It is not a buzzword. It is a way of describing how legal clarity and ins...