Mercedes-Benz debuted a $1 billion residential luxury tower in Dubai, where apartments are expected to cost as much as $10 million each.
Dubbed “Mercedes-Benz Places,” the upscale auto company announced its venture into the real-estate world on Instagram on Thursday, which it’s doing with the help of Emirati developer Binghatti.
The 65-story building is expected to rise approximately 1,118 feet above downtown Dubai’s bustling metro when it’s complete in the fourth quarter of 2026, according to United Arab Emirates-based business news site ZAWYA.
For reference, New York City’s Chrysler Building stands 1,048 tall.
It’s home to 150 apartments, starting at $2.7 million, with the promise of “unobstructed views of the world’s tallest tower,” the nearly 3,000-foot-tall Burj Khalifa, according to Mercedes’ website.
Per the German automaker’s Instagram post on the joint development, the glass-encased Mercedez-Benz Places — whose “distinctive elliptical exterior that’s reminiscent of the flowing lines of a host of ultra-modern Mercedes-Benz cars” — is meant to “underline [the company’s] strategy to strengthen its position as the world’s most desirable automotive brand.”
Binghatti is the first of its kind for an automaker, according to Bloomberg.
Binghatti, meanwhile, also has an ongoing residential project with fellow luxury car manufacturer Bugatti, which tapped the real-estate developer for a project that will include elevators to transport cars to penthouses, which broke ground in Dubai last year, Bloomberg reported.
The firm has already sold 32 of the 182 residences in the Bugatti Residences, with buyers shelling out as much as $2,620 per square foot — some of the highest prices Dubai has seen, per the outlet.
Binghatti wouldn’t disclose how many apartments had been sold in the Mercedes-branded tower, only disclosing to Bloomberg that it sold all the residences available in its first phase.
Binghatti also has a partnership with upscale jewelry and watch firm Jacob & Co. for what’s set to become the world’s tallest residential building located in the wealthy Emirati city.
Despite recent warnings that there are “massive” issues within the commercial real-estate sector, Binghatti’s chief executive Mohammed Binghatti reportedly isn’t worried about a slowdown, per Bloomberg.
The firm has spent $330 million on land in the past three months alone, and Binghatti told the outlet: “We’re definitely going to see more growth this year and the following year.”
“There is clear wealth migration coming to Dubai and an increase in the population, which provides room for organic growth in the market,” he added.
People who come to Dubai, a lot of them already have the liquidity to deploy. They want a safe haven to invest.”
Representatives for Mercedes and Binghatti did not immediately respond to The Post’s request for comment.
In the US, however, the real estate market was likened to “a slow-moving train wreck” by Larry McDonald, the founder of financial analysis firm The Bear Traps Report.
Since the pandemic, New York City has been in a so-called “urban doom loop” caused by an influx of working from home during the pandemic — a trend that has stuck despite return-to-office mandates.
The doom loop concept is defined by empty office towers, which destroy the quality of life and eventually drive residents out.
In the Big Apple, occupancy has only bounced back to 48.4% since the pandemic.
At the start of 2020, however, office occupancy was a strong 90% — before it plummeted to 10% upon the outbreak of COVID-19.
After shouldering a wave of defaults from landlords, banks are sitting on as much as $160 million in losses on loans to the commercial real estate market, according to researchers from Columbia, Stanford, the University of Southern California, and Northwestern, per a working paper published by the National Bureau of Economic Research last month.
The grim findings support an earlier calculation by Morgan Stanley that showed lenders would need to negotiate more than $1.5 trillion of their commercial real estate portfolios by the end of 2025 in order to avert defaults.
This story originally appeared on NYPost
